[Senate Hearing 105-374]
[From the U.S. Government Publishing Office]


39-858 cc

                                                     S. Hrg. 105-374 


 
  DEPARTMENT OF THE INTERIOR AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

=======================================================================

                                HEARINGS

                                before a

                          SUBCOMMITTEE OF THE

            COMMITTEE ON APPROPRIATIONS UNITED STATES SENATE

                       ONE HUNDRED FIFTH CONGRESS

                             FIRST SESSION

                                   on

                               H.R. 2107

  AN ACT MAKING APPROPRIATIONS FOR THE DEPARTMENT OF THE INTERIOR AND 
RELATED AGENCIES FOR THE FISCAL YEAR ENDING SEPTEMBER 30, 1998, AND FOR 
                             OTHER PURPOSES

                               __________

                        Department of Agriculture
                          Department of Energy
                       Department of the Interior
                    National Endowment for the Arts
                 National Endowment for the Humanities
                       Nondepartmental witnesses
                Department of Health and Human Services
                        Smithsonian Institution

                               __________

         Printed for the use of the Committee on Appropriations



                               


Available via the World Wide Web: http://www.access.gpo.gov/congress/senate

                      U.S. GOVERNMENT PRINTING OFFICE
 39-858 cc                    WASHINGTON : 1998
_______________________________________________________________________
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                           ISBN 0-16-056253-8



                      COMMITTEE ON APPROPRIATIONS

                     TED STEVENS, Alaska, Chairman
THAD COCHRAN, Mississippi            ROBERT C. BYRD, West Virginia
ARLEN SPECTER, Pennsylvania          DANIEL K. INOUYE, Hawaii
PETE V. DOMENICI, New Mexico         ERNEST F. HOLLINGS, South Carolina
CHRISTOPHER S. BOND, Missouri        PATRICK J. LEAHY, Vermont
SLADE GORTON, Washington             DALE BUMPERS, Arkansas
MITCH McCONNELL, Kentucky            FRANK R. LAUTENBERG, New Jersey
CONRAD BURNS, Montana                TOM HARKIN, Iowa
RICHARD C. SHELBY, Alabama           BARBARA A. MIKULSKI, Maryland
JUDD GREGG, New Hampshire            HARRY REID, Nevada
ROBERT F. BENNETT, Utah              HERB KOHL, Wisconsin
BEN NIGHTHORSE CAMPBELL, Colorado    PATTY MURRAY, Washington
LARRY CRAIG, Idaho                   BYRON DORGAN, North Dakota
LAUCH FAIRCLOTH, North Carolina      BARBARA BOXER, California
KAY BAILEY HUTCHISON, Texas
                   Steven J. Cortese, Staff Director
                 Lisa Sutherland, Deputy Staff Director
               James H. English, Minority Staff Director
                                 ------                                

    Subcommittee on Department of the Interior and Related Agencies

                   SLADE GORTON, Washington, Chairman
TED STEVENS, Alaska                  ROBERT C. BYRD, West Virginia
THAD COCHRAN, Mississippi            PATRICK J. LEAHY, Vermont
PETE V. DOMENICI, New Mexico         DALE BUMPERS, Arkansas
CONRAD BURNS, Montana                ERNEST F. HOLLINGS, South Carolina
ROBERT F. BENNETT, Utah              HARRY REID, Nevada
JUDD GREGG, New Hampshire            BYRON DORGAN, North Dakota
BEN NIGHTHORSE CAMPBELL, Colorado    BARBARA BOXER, California
                           Professional Staff
                              Bruce Evans
                              Ginny James
                             Anne McInerney
                             Kevin Johnson



                            C O N T E N T S

                              ----------                              

                        Thursday, March 13, 1997

                                                                   Page
Department of Energy: Office of the Secretary....................     1

                        Thursday, April 10, 1997

Department of the Interior: Bureau of Indian Affairs.............   111

                        Thursday, April 17, 1997

Department of Agriculture: Forest Service........................   177

                        Thursday, April 24, 1997

National Endowment for the Arts..................................   321
National Endowment for the Humanities............................   371

                         Tuesday, May 20, 1997

Department of the Interior: Office of the Secretary..............   409
Nondepartmental witnesses........................................   673



  DEPARTMENT OF THE INTERIOR AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

                              ----------                              


                        THURSDAY, MARCH 13, 1997

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 2:35 p.m., in room SD-124, Dirksen 
Senate Office Building, Hon. Ben Nighthorse Campbell, 
presiding.
    Present: Senators Gorton, Domenici, Campbell, Byrd, and 
Dorgan.

                          DEPARTMENT OF ENERGY

                        Office of the Secretary

STATEMENT OF FEDERICO F. PENA, SECRETARY OF ENERGY
ACCOMPANIED BY:
        ROBERT S. KRIPOWICZ, PRINCIPAL DEPUTY ASSISTANT SECRETARY, 
            OFFICE OF FOSSIL ENERGY
        JOSEPH J. ROMM, PRINCIPAL DEPUTY ASSISTANT SECRETARY, OFFICE OF 
            ENERGY EFFICIENCY AND RENEWABLE ENERGY
        ELIZABETH E. SMEDLEY, ACTING CHIEF FINANCIAL OFFICER

                 opening statement of senator campbell

    Senator Campbell. The Appropriations Subcommittee on the 
Interior will be in order. Senator Gorton is detained on the 
floor for a little while longer, so I will go ahead and start 
the proceedings, and I certainly want to welcome my friend and 
colleague for so many years and the new Secretary to our 
hearing today. I personally am very pleased at that 
opportunity. Federico and I go way back. I know his leadership 
is invaluable in a time when we have so many important issues 
to deal with at the Department of Energy.
    Certainly this administration has sent him to the committee 
to justify the request of budget authority of $19 billion. That 
is an increase of almost $3 billion over fiscal year 1997. The 
budget says that a significant portion of that comes from, we 
are told, a change in the financing of construction projects. I 
am a little bit skeptical. Although this change seems sound 
from an accounting perspective, I do worry that it will also be 
used to mask some of the questionable spending changes as well.
    Although it is not the subject of your testimony today, Mr. 
Secretary, I want to point out that Rocky Flats, that you know 
very well and I do, too, is an example of items that really do 
concern me and all of us in Colorado because you are familiar 
with that.
    The administration proposes funding for well under what 
most people, both sides of the aisle, think is necessary to 
contain and manage the plutonium and restore the site in a 
meaningful timeframe, and if you care to venture into that in 
your testimony, I would also appreciate that.
    But before we start, I would like to defer to my colleague 
and a man that has been my mentor in many respects, Senator 
Byrd.
    Senator Byrd. Thank you, Senator. I have a good many 
questions, and if you have to leave soon, perhaps you better go 
ahead with your questions.
    Senator Campbell. I can wait a while. Would you just rather 
go to the Secretary's testimony before you ask questions?
    Senator Byrd. Yes; let us let him speak first. Thank you.
    Senator Campbell. Mr. Secretary, please proceed.

                summary statement of hon. federico pena

    Secretary Pena. Thank you very much, Mr. Chairman, Senator 
Byrd and members of the subcommittee. Let me thank you for 
giving me the opportunity to testify on behalf of the 
Department of Energy's fiscal year 1998 budget. Having just 
been confirmed I think less than 24 hours ago, I am especially 
pleased to be here.
    Let me introduce the two gentlemen who are with me today. I 
think they are well known to you already. To my left or to your 
right is Robert Kripowicz, who is the Principal Deputy 
Assistant Secretary for Fossil Energy. In the event that there 
are some highly technical questions, Mr. Kripowicz will be able 
to assist me in that.
    To my right or to your left is Dr. Joseph Romm who is the 
Principal Deputy Assistant Secretary for Energy Efficiency. I 
want to thank them very much for their hard work in preparing 
me in a relatively short period of time to be here this 
afternoon.
    Mr. Chairman, it is appropriate that my first hearing be 
before this subcommittee, which has been such a crucial partner 
in the delivery of the Department's energy mission. Although 
the subcommittee is directly concerned with a portion of the 
Department's missions, this subcommittee is a key partner in 
the objective that we list at the very top, and that is the 
enhancement of our national energy security and the development 
and deployment of clean energy.
    Each day Americans depend on the benefits of energy, 
usually without considering the role that it plays in our 
quality of life, but as this subcommittee well knows, when 
energy supplies are disrupted, every American feels it. There 
have been three major oil disruptions in the past 23 years, 
each causing substantial domestic and international turmoil.
    In the next 15 years the United States net oil imports will 
grow to 60 percent of domestic consumption. Persian Gulf oil-
producing nations will increase their oil exports to surpass 
their peak of 67 percent of global oil exports in the embargo 
year of 1974, and this is, frankly, unacceptable.
    The budget that we present to you advances national energy 
objectives in two broad ways. First, it emphasizes energy 
supply solutions through increased domestic energy production, 
expanded use of natural gas, diversification of oil supply 
options, development of alternative transportation fuels, and 
maintenance of the strategic petroleum reserve to ensure 
economic stability in the event oil supply disruption should 
occur in the future.
    Second, it emphasizes energy use solutions promoting the 
increased efficiency of energy used in all sectors of the 
economy and enhanced competitiveness of the electric utility 
industry and other sectors of the energy industry.
    For energy efficiency programs we are requesting $707 
million, a $137.9 million increase or 24 percent above the 
fiscal year 1997 comparable appropriations.
    Why should we request such a large increase? We believe it 
is a smart investment. Improved efficiency is not only 
achievable, it is essential if we are to avoid serious risk in 
the future. Moreover, it is a proven way to reduce the demand 
for energy while enhancing our standard of living and our 
environmental quality.
    For example, EIA's 1997 annual energy outlook forecasts 
that in 2015 the average home will be 4 percent larger and will 
rely more on electricity-based technologies. Annual per capita 
personal highway and air travel, something that I'm familiar 
with from my former position, are expected to be 12 and 59 
percent higher, respectively.
    Despite this growth, the forecast report indicates that 
energy intensity per capita will remain essentially static. The 
reason--EIA forecasts that improvements in energy efficiency 
will provide higher levels of service without significant 
increases in energy use per capita. So energy efficiency 
products and improvements are built into these forecasts to at 
least keep per capita energy use stable for the next 10 or 15 
years.
    So our budget request is part of this energy efficiency 
strategy to deliver and design cars of the future, improve 
efficiency in energy-intensive industries, develop energy 
efficient buildings in communities for the 21st century and 
increase the use of proven efficiency measures by consumers in 
Federal, State, and local governments as well as low-income 
households.
    This request also recognizes that nearly 85 percent of the 
Nation's energy is supplied by fossil fuels and that this 
percentage is expected to increase to 88 percent by the year 
2015.
    This budget includes $346 million for fossil energy 
research and development. This is a 5-percent reduction from 
the fiscal year 1997 level because many supported gas and coal 
fuel power system projects are entering their final phase of 
development. At this level, the Department will continue its 
support for technologies that develop the clean, highly 
efficient powerplant for the 21st century, boost the Nation's 
production of natural gas and oil, and provide a new option to 
supplement our country's liquid fuels.
    The Department does not propose to sell any oil from the 
strategic petroleum reserve to finance operations for this 
fiscal year. The Department proposes to return approximately 
$153 million of Clean Coal Technology Program funds to the 
Treasury in fiscal year 1998 and defer $133 million that will 
not be required until fiscal year 1999.
    The proposed rescission does not impact, and I want to 
emphasize that, does not impact ongoing projects and returns to 
the Treasury, only funding that becomes available from canceled 
or restructured projects. We believe that this proposal honors 
our commitment to fiscal discipline without jeopardizing the 
already significant accomplishments of this program.
    Mr. Chairman and members, the Clean Coal Technology Program 
began because of the foresight of this subcommittee. It is an 
excellent example of what is possible with Federal research and 
development assistance. The General Accounting Office, for 
example, cites this program as a model of public-private 
partnership.
    One excellent success story concerns the development of low 
NOx burners. This technology now provides utility 
powerplants with a way to reduce nitrogen oxide emissions, 
which contributed smog and ozone buildup to a level that is 10 
times lower than would have been available without the Federal 
investment.
    Today almost 25 percent of coal-fired capacity is now using 
these cleaner burners. Sales have exceeded $750 million and 
will approach about $4 billion by the year 2000.
    Again, in part due to this subcommittee's foresight, the 
program includes a recoupment provision that requires that the 
Government be paid back for its investment, and that the 
technologies are a commercial success, and we're beginning to 
see some of that repayment now in the early years. This 
provision is now beginning to see those repayments, 
approximately $400,000, to the Government.
    Mr. Chairman and members, let me conclude my remarks with 
those very brief statements. Mr. Chairman, you asked me to make 
some comments about Rocky Flats, and there were some concerns 
about the proposed increase in the overall budget which 
addresses a new approach that we're using to try to facilitate 
the upfront funding of major programs for the Department in a 
way which I think will save us money in the long term.

                           prepared statement

    I would be very pleased to respond to both those issues in 
my question-and-answer period, and of course respond to other 
questions that you and other members may have. Thank you very 
much for your courtesies.
    [The statement follows:]
                Prepared Statement of Hon. Federico Pena
    Mr. Chairman and members of the Subcommittee, I am pleased to 
appear before you today to discuss the fiscal year 1998 budget request 
for the Department of Energy.
    The President, in his State of the Union message to the Congress, 
spoke about our nation's responsibility to keep its commitments and to 
provide for the future. An important commitment he spoke about was 
fiscal discipline, the duty we have to future generations to balance 
the budget. He also spoke of our duty to future generations to maintain 
and refresh our nation's capacity for scientific and technological 
innovation and thereby shape the future.
    These themes, keeping commitments and providing for the future, are 
at the heart of the Department's missions. Our sense of obligation to 
continue investments that ensure the nation's security, 
competitiveness, and improved environmental quality for generations to 
come drives our program objectives. Science, technology, research, and 
development are the common threads running throughout the Department's 
varied missions, providing the tools with which to shape our energy 
future.
                       priorities for the future
    The Department of Energy has four key priorities:
    (1) Enhancing our energy security by improving the energy 
efficiency of our economy and by developing and deploying clean and 
affordable energy supplies;
    (2) Ensuring a safe and reliable nuclear weapons stockpile and 
reducing the global nuclear danger;
    (3) Cleaning up former nuclear weapons sites and finding a more 
effective and timely path forward for disposing of nuclear waste; and
    (4) Leveraging science and technology to advance fundamental 
knowledge and our country's economic competitiveness with a stronger 
partnership with the private sector.
    All of these needs present unparalleled opportunities and daunting 
challenges that will greatly affect the future of our nation and indeed 
the world. However, first among them is energy.
    Each day, Americans depend on the benefits of energy, usually 
without considering the role it plays in our quality of life. But there 
have been three major oil disruptions in the past 23 years, each 
causing substantial domestic and international turmoil. In the next 15 
years, U.S. net oil imports will grow to 60 percent of domestic 
consumption, and Persian Gulf oil producing nations will increase their 
oil exports to surpass their peak of 67 percent of global oil exports 
in the embargo year of 1974. The potential of this situation poses 
serious risks for America's future.
                        a strong energy strategy
    We must have a credible energy strategy that provides for our 
energy security and meets our commitment to be responsible stewards of 
the environment. Our energy strategy must, at a minimum:
  --Increase domestic energy production through smarter regulation and 
        technological advances to improve production economics and 
        reduce environmental impacts of both oil and natural gas 
        development;
  --Expand the use of natural gas;
  --Diversify our oil supply options in areas such as the Western 
        Hemisphere, Central Asia and the Caspian Sea;
  --Reduce U.S. dependence on insecure sources of foreign oil by making 
        us more efficient in our use of all energy;
  --Develop clean, renewable energy supplies, alternative 
        transportation fuels, and clean coal technology;
  --Maintain our strategic petroleum reserve at levels which meet our 
        international responsibilities and ensure stability in the 
        event of supply disruptions;
  --Maintain the safety of nuclear power reactors;
  --Address the challenge of global climate change; and
  --Enhance the competitiveness of the electric utility industry and 
        other sectors of the energy industry.
    The President's energy policies set out to accomplish these 
objectives in partnership with industry. These innovative 
partnerships feature: collaboration with industry to identify 
priorities; cost-sharing of projects; and federal support used 
as a catalyst to develop innovative research and development 
(R&D). These partnerships provide the edge that will help 
achieve our national energy goals.

         partnering with industry to achieve energy objectives

    Recently, government investment in research and development 
and the appropriate federal role have been the subject of much 
debate. This budget request supports a strong portfolio of 
energy research and development which builds on prior year 
commitments to cutting-edge technologies. Fiscal year 1998 is a 
key year in which to steady our research and development 
investments because, after ten years of public-private 
collaboration, dividends are coming to the American people. For 
example, it is estimated that within two to three years, we 
will have successfully developed a ``next generation'' gas 
turbine that will surpass any competing turbine offered outside 
the U.S. Advanced gas turbines will provide the capability of 
generating electric power at efficiencies of over 60 percent, 
and with NOx emissions so low as to allow them to be 
sited in environmentally restricted areas such as California.
    We also will have developed an advanced fuel cell that will 
significantly boost the efficiency and environmental 
performance of twenty-first century natural gas and coal-fired 
power plants. When commercially available, these technologies 
will bring lower electricity costs, more U.S. jobs in the 
energy industry, and a cleaner environment with lower emissions 
for all Americans. In the case of both of these technologies, 
it is federal research and development support which provides 
the difference needed to develop the ``state of the art'' in 
terms of efficiency and environmental quality.
    Similarly, the Clean Coal Technology program was begun in 
1985 in recognition of the national interest in technologies 
which promote the environmentally sensitive use of the nation's 
vast, and relatively inexpensive, coal reserves. Out of 40 
projects, the Clean Coal Technology Program has successfully 
completed its involvement in 20 projects, and the remainder are 
in operation, construction or design phases. The General 
Accounting Office now points to the Clean Coal Technology 
program as a model of public-private partnership. The program 
has resulted in commercial development of 14 technologies, and 
the non-federal cost share now averages 66 percent per project. 
Nevertheless, because there are balances available from 
previously canceled or restructured projects, the Department 
proposes to rescind $153 million in fiscal year 1998, and to 
defer an additional $133 million in balances that will not be 
required until fiscal year 1999.
    In fiscal year 1998 the Clean Coal Technology program will 
produce the following important results:
  --Operation of the nation's first three commercial scale coal 
        gasification combined cycle power plants--at Tampa, FL; Terre 
        Haute, IN; and Reno, NV--each facility achieving 95 percent or 
        greater sulfur removal, and 90 percent nitrogen oxide 
        reductions;
  --Startup of a commercial-scale advanced combustor power plant at 
        Healy, AK, which will reduce sulfur dioxide by 90 percent or 
        more, and nitrogen oxides by 70 percent;
  --Completion of tests at an advanced coal processing facility in 
        Colstrip, MT, producing clean fuel with sulfur content as low 
        as 0.3 percent and heating value up to 12,000 Btus/lb.
    Research and development is critical if the U.S. is to 
maintain its technological edge. The question is: how should 
our national research and development investment be shared 
between the public and private sectors? U.S. private sector 
spending for energy research and development is down more than 
30 percent since the early 1980s. One reason is that recent 
changes in domestic energy markets, particularly deregulation 
of the natural gas industry and the move toward greater 
competition in the electric power industry, have encouraged 
general corporate cost-cutting but discouraged research and 
development, especially if the payoff is beyond one to three 
years. At the same time, the makeup of the U.S. oil industry is 
shifting from large, multi-national producers to smaller 
companies (who drill 85 percent of all new wells) with limited 
research and development capability and access to advanced 
technologies. In addition, expectations of continued low oil 
prices may be discouraging private research and development 
that could lower the cost of new sources of fuels.
    When the result will clearly benefit the public at large--
for example through cleaner air, more affordable energy, or 
greater energy security--government involvement is justified 
and can make the significant difference. This is especially 
true when the research and development is beyond the private 
sector's economic capability, or interest. Some research and 
development has no current ``market driver.'' Some research and 
development may be vital in the 21st century, but holds no 
economic incentive today for the private sector. For example, 
few companies can today justify an aggressive research program 
aimed at preventing the generation of the greenhouse gas carbon 
dioxide, much less investing in a means of capturing and 
disposing of it. There is no immediate ``bottom line'' payoff. 
If the public benefits are important--but research is too 
fundamental to offer commercial potential, or the advanced 
technologies pose too great a technical risk or are outside the 
time frame that would justify industry's investment on its 
own--then federal support is justified, and sometimes critical 
to secure public goals and benefits.
    The federal government has unique expertise. Our national 
laboratories have capabilities developed for defense purposes 
that can be adapted through research and development to improve 
domestic energy production. No private sector firm possesses 
these capabilities. With global markets for new energy 
technologies offering lucrative opportunities, other countries 
such as Japan and Germany are using government-industry 
research and development partnerships to develop innovations 
that will compete with U.S. technologies.
    As Americans we have a duty to discipline government 
spending and eliminate the deficit in consideration of future 
generations. However, reducing federal support of energy 
research and development would place an even higher burden on 
future generations. Failing to sufficiently invest in energy 
technology development today sends a signal that we are not 
willing to work for the future. Affordable heating, cooling, 
transportation and cleaner supplies of energy will depend on 
continued innovation that keeps pace with future energy 
challenges. Industry is a critical partner in this effort.

    the fiscal year 1998 budget--ensuring secure supplies of clean, 
                           affordable energy

    The Department's fiscal year 1998 budget request ties 
program funding requirements to specific outcomes. This budget 
was formulated to accomplish strategic objectives which support 
our national energy goals.

                           energy efficiency

    According to the 1997 Annual Energy Outlook from the Energy 
Information Administration (EIA), the average home in 2015 is 
expected to be 4 percent larger and to rely more heavily on 
electricity-based technologies. Annual highway travel and air 
travel per capita in 2015 are expected to be 12 and 76 percent 
higher, respectively, than their current levels. Despite this 
expected growth in demand, the EIA report expects that 
``primary energy intensity on a per capita basis will remain 
essentially static through 2015.'' The Outlook attributes this 
to anticipated improvements in energy efficiency which will 
``make it possible to provide higher levels of service without 
significant increases in energy use per capita''.
    These projections show the importance of energy efficiency 
technologies. However, these projected gains in efficiency will 
not be enough. The same forecast projected increased foreign 
oil reliance which could pose a severe risk to our energy and 
economic security in the coming years. In consideration of our 
future, we cannot afford to back away from the investment in 
energy efficiency technologies.
    Reflecting the Administration's commitment to energy 
efficiency technologies as a key element of the national energy 
strategy, the Department's total fiscal year 1998 request for 
Energy Efficiency programs is $707.7 million, a $137.9 million 
increase or 24 percent above the fiscal year 1997 comparable 
appropriation. We recognize, of course, that this is a bold 
initiative that may be difficult to achieve in these 
constrained fiscal times. But we believe the program is well 
conceived and essential in order to provide for a more secure 
and environmentally responsible energy future.
    The Office of Energy Efficiency and Renewable Energy 
programs is organized to address the challenges facing the 
major energy use sectors of the national economy--industry, 
buildings, transportation, and utilities. The request for 
Industry sector efficiency programs is $139.6 million, 
Buildings $302.4 million, and Transportation $203.2 million. In 
addition, to directly address the energy efficiency of one of 
the largest consumers of energy, the federal government, $31.1 
million is requested for the Federal Energy Management Program.
    The Department's fiscal year 1998 request continues key 
initiatives, started at the beginning of the Clinton 
Administration, designed to accelerate deployment of existing 
technologies and emphasize research and development 
technologies for the future. The Department has charted a 
course to provide energy solutions into the next century. We 
have outlined major goals and developed this budget request 
with the aim of achieving the following key objectives.
    Designing and delivering cars of the future.--The 
Department of Energy leads the design team of the government-
wide Partnership for a New Generation of Vehicles (PNGV), a 
multi-agency/industry collaborative initiative led by the 
Department of Commerce. The goal of PNGV is to develop an 80 
mile-per-gallon family car and demonstrate a prototype car for 
the future by 2004. In fiscal year 1998 the Department proposes 
an increase of $22.1 million for PNGV programs, for a total 
fiscal year 1998 request of $128.3 million for PNGV related 
research and development in the Energy Efficiency program.
    The total fiscal year 1998 request for Transportation 
programs, including PNGV related activities, is $203.2 million. 
An increase of $6.2 million is proposed for Technology 
Deployment activities which promote the use of alternative 
fuels through the voluntary Clean Cities programs and other 
activities. The $2 million increase in Heavy Vehicle Systems 
research and development will support increased efficiencies in 
advanced diesel engines and activities to deploy existing 
technologies directed at heavy vehicles such as buses, and 
trucks. Decreases of $2.9 million are proposed in Automotive 
Materials and $3.5 million for Heavy Vehicle Alternative Fuels 
research and development.
    Improving efficiency in energy intensive industries.--The 
Department is working closely with the most energy-intensive 
industries to focus cooperative research and improve U.S. 
competitiveness. Working together with industry to encourage 
the development and application of energy efficiency and 
pollution prevention technologies, our goal is to help achieve 
over $10 billion of industry energy cost savings by the year 
2010. The Department's fiscal year 1998 request emphasizes the 
Industries of the Future public-private partnership program and 
proposes a $9.4 million increase for a fiscal year 1998 program 
total of $55.7 million.
    In addition, the Department is requesting increases to 
support other cost-effective industry pollution prevention 
partnership programs in fiscal year 1998: for Motor Challenge, 
$2.1 million, to continue collaboration with the private sector 
to improve the efficiency of industrial motors; for Climate 
Wise, $2.8 million, to continue efforts to voluntarily reduce 
global warming emissions from industrial energy users; for 
NICE3 partnerships, $6.2 million, to continue the highly 
leveraged deployment of innovative energy efficiency and 
pollution prevention technologies in partnership with State, 
local and other federal agency partners; and Industrial 
Assessment Centers, $1.1 million, to enhance technical support 
available to industries seeking to audit the efficiency of 
their facilities. Proposed for continuation at the fiscal year 
1997 comparable level are: Advanced Turbine Systems, to 
continue development of highly energy efficient turbine engines 
for future use in industrial settings, and Advanced Materials 
R&D, to develop highly efficient industrial materials, such as 
ceramics, which are able to withstand greater heat and stress 
demands, thereby, operating more efficiently with lower energy 
requirements.
    Developing buildings and communities for the 21st 
century.--By working with the building industry, community 
leaders and customers, the program's goal is to develop and 
implement a plan for buildings and communities of the future. 
The typical American family of four spends $2,200 each year on 
energy. The Energy Efficiency program is targeting residential 
energy consumption with the objectives of cutting builder costs 
by 10 percent, consumer costs by 20 percent, and pollution by 
30 percent, saving 3 quads of energy and reducing environmental 
emissions by 60 Million Metric Tons Carbon Equivalent by the 
year 2010.
    Public-private deployment partnerships for the buildings 
sector which are designed to increase energy efficiency are 
proposed to increase by $10 million in fiscal year 1998. One 
recent example of the benefits of this partnership approach is 
the Rebuild America program where $500,000 in Federal funds was 
used to attract nearly $33 million in State, local and private 
funds to implement energy efficiency technologies in commercial 
and government buildings at the State and local levels. The $10 
million increase in building sector programs will support: 
Rebuild America, as well as promote efficient and affordable 
residential and industrialized housing; Energy Star Appliances, 
a voluntary incentive program that promotes market demand for 
energy efficient appliances; and enhanced Building Codes and 
Standards activities with the States. Also supported is 
research and development funding for advanced building 
equipment and materials, including windows and lighting.
    Transferring proven energy efficiency measures to 
consumers.--By applying energy efficiency measures to existing 
buildings and operations, our goal is to increase efficiency 
and reduce government energy consumption 30 percent by 2005 
from a 1985 baseline. Through aggressive deployment of 
technologies available today, we propose to reduce annual 
energy consumption by one quad of energy by the turn of the 
century. To move toward these targets we propose the following 
program levels in fiscal year 1998:
    For the Federal Energy Management Program $31.1 million is 
requested. This is an $11.3 million increase to let the program 
bring a series of new energy technology options to federal 
facilities managers and support the growth of alternate, non-
Federal financing options to implement energy cost savings such 
as up-front capital financing from energy utilities which is to 
be repaid from the agencies' monthly energy consumption 
savings.
    A $41.3 million increase is proposed for grants. Federal 
support through these grants is cost-effective as the money 
often leverages investments by State, local and private sources 
to deploy energy related technologies. State Grants which 
support innovative energy efficiency programs of the State 
Energy Offices and help to generate $19 million in non-Federal 
investments for every appropriated dollar, are proposed to 
increase $8 million to a total of $37 million in fiscal year 
1998. Also proposed is a $33.3 million increase for the 
Weatherization Assistance Program for a fiscal year 1998 total 
of $154.1 million, to deploy existing energy efficiency 
technologies in households that cannot afford the investment 
without the program. This level of funding will weatherize 
close to 78,000 households in fiscal year 1998. Level funding 
between fiscal year 1997 and fiscal year 1998 of $1.6 million 
is requested for the Municipal Energy Management Program which 
works with urban communities, and leverages four non-Federal 
dollars to every federal dollar.

                 fossil energy research and development

    The budget request for the Fossil Energy program recognizes 
that nearly 85 percent of the nation's energy is currently 
supplied by coal, oil and natural gas. With the use of these 
fuels projected by the Energy Information Administration to 
increase to more than 88 percent by 2015, the Department's 
fossil energy program focuses its funding primarily on ways to 
enhance our domestic energy security and ensure continued 
environmental protection.
    The Fossil Energy fiscal year 1998 budget addresses these 
energy concerns. As a near-term response to a potential oil 
supply disruption, the fiscal year 1998 budget maintains the 
strategic petroleum reserve at 563 million barrels, respecting 
our international responsibilities and providing a powerful 
tool to blunt oil shortages and price fluctuations. For the 
longer-term, the budget continues research and development into 
new oil exploration, production and processing technologies 
that can lower costs and boost domestic oil supplies, 
particularly from properties owned by smaller independent 
producers. The budget also maintains research into alternatives 
to conventional petroleum, including technologies to produce 
high-quality liquid fuels from natural gas and coal.
    The Fossil Energy Research and Development program is 
committed to new natural gas-and coal-fired electric power 
technologies that can produce significantly less carbon dioxide 
and acid rain emissions than current technology, while keeping 
electricity costs affordable.
    The fiscal year 1998 budget moves into the final phases of 
development for several advanced electric power technologies, 
including low emission boilers, advanced generation fuel cells 
and ultra-high efficiency gas turbines, culminating a decade or 
more and several hundred million dollars of prior public and 
private sector investment. DOE's support for these 21st century 
technologies is becoming increasingly important as the U.S. 
industry, confronted by the uncertainties of restructuring, 
continues to cut back financing of longer-range, higher-risk 
R&D, while at the same time demand for new and cleaner sources 
of electricity rapidly increases throughout much of the world.
    The fiscal year 1998 budget request also recognizes that 
U.S. demand for clean-burning natural gas could increase 
significantly in the next decade, particularly in the electric 
power generation market. The proposed budget would maintain a 
major effort to ensure that adequate and affordable gas 
supplies can continue to be produced to meet this rising 
demand. New exploration and production technologies, such as 
innovative imaging and improved fracturing techniques, will 
help the U.S. expand its natural gas production by several 
trillion cubic feet over the next 5-10 years, particularly from 
difficult, low-permeability formations that are currently 
beyond the capabilities of today's technology.
    The fiscal year 1998 request for Fossil Energy Research and 
Development is $346.4 million, which is a five percent 
reduction from the fiscal year 1997 level. This is because many 
of the Department's supported gas and coal-fueled power systems 
are entering their final phase of development this fiscal year 
and will be available to meet market demand close to the turn 
of the century. We plan to redirect our program to focus on 
advanced, high payoff research and development. The proposed 
budget retains a commitment to technology advancement and, in 
most cases, is highly leveraged by joint partnerships with the 
private sector. This budget was developed to address the 
following strategic objectives:
    Develop the Clean, High Efficiency Power Plant for the 21st 
Century.--The goal is to provide the nation's electric power 
industry, between 2000 and 2010, with a new generation of 
natural gas and coal power technologies that progressively 
lower CO2 emissions 30 to 50 percent, reduce 
SO2 and NOx emissions to as little as 1/
10th the levels mandated by current federal standards, and 
produce electricity at costs 10 to 20 percent below today's 
conventional plants.
    This request includes $66.3 million for Advanced Clean/
Efficient Power Systems under the Coal program. This funding 
will focus on developing progressively higher efficiency 
systems that emit significantly less CO2 than 
current systems, and exceed environmental compliance 
requirements through processes that prevent, rather than 
control, pollutant emissions. In fiscal year 1998, $5.5 million 
is proposed for the Advanced Pulverized Coal-Fired Power Plant 
program, which will stretch out the Department's schedule, and 
require the down selection of contractors to a lead developer.
    Also included is $31.4 million for continuation of the 
Advanced Turbine Systems Program which also will stretch out 
the Department's schedule and require selection of a lead 
developer.
    Boost the Nation's Production of Natural Gas and Oil.--
Through the development and application of advanced energy 
technologies, the Department's goal is to improve the 
capability of the nation's petroleum industry to produce 
additional supplies of secure, clean domestic natural gas and 
oil, helping to increase U.S. oil production by an average of 
0.5 million barrels per day and gas production by 3.7 trillion 
cubic feet per year by 2010.
    The budget includes $25.3 million for the supply portion of 
the gas budget to continue to focus on advanced drilling; 
completion, stimulation, and reservoir characterization 
technology and resource assessment methodology; storage 
technologies and engineering techniques; upgrading of low-BTU 
gas; conversion of natural gas to clean liquid transportation 
fuels and feedstocks; and environmental research and analysis.
    The request for petroleum activities is $52.2 million, a 14 
percent increase from the fiscal year 1997 level of $45.9 
million. This increase will support Exploration and Production 
Supporting and Environmental Research to achieve improvements 
in locating, processing and delivery of oil and gas resources 
in a more environmentally sensitive manner. The Supporting 
Research program includes the development of advanced 
technologies for exploration, drilling, reservoir 
characterization, and extraction.
    Provide a New Option to Supplement the Nation's Liquid 
Fuels.--The goal is to provide the nation, by 2005, with an 
alternative source of liquid fuels, costing $25 per barrel or 
less, that can be produced from coal and solid wastes.
    This request includes $15.8 million for the Advanced Clean 
Fuels program which demonstrates advanced concepts for the 
clean production of coal-based transportation fuels, chemicals 
and other high value products that can compete with petroleum 
products.

                      strategic petroleum reserve

    Maintenance of the Strategic Petroleum Reserve is a key 
component of our national energy security policy. No sale of 
oil is proposed for this fiscal year. At the proposed level of 
$209 million, the program will maintain operational readiness 
and facilities maintenance, continue the Drawdown Readiness 
Program, conduct annual exercises, and continue the 
environment, safety and health program. The Department will 
continue its plan to degasify hot and gassy oil in the 
Strategic Petroleum Reserve. As is, this oil is currently 
unusable and presents potential safety concerns. In fiscal year 
1998, the program will degasify 39 million barrels of gassy oil 
at Big Hill, Texas, thereby restoring capacity to the ready 
reserves. In addition, efforts to stabilize Weeks Island will 
continue as will the Life Extension Program, which will be 
completed in fiscal year 2000.

                         clean coal technology

    In fiscal year 1998, the Department continues current 
policy and does not propose to start any new domestic Clean 
Coal Technology projects. Funds available from canceled and 
restructured projects enable the Department to propose a 
rescission of $153 million in fiscal year 1998. In addition, 
the Department proposes to defer the use of $133 million which 
otherwise would have been available until fiscal year 1999. The 
Department has signed cost-sharing commitments for all projects 
in the program, and balances available from previous 
restructuring and cancellation enable a portion of the 
previously appropriated funds to be returned to the Treasury 
without endangering the success of this program.

            naval petroleum reserves and oil shale reserves

    The fiscal year 1998 budget request for the Naval Petroleum 
and Oil Shale Reserves of $117 million provides for continued 
operation of the reserves until their sale and asset transfer 
is completed. The National Defense Authorization Act of fiscal 
year 1996, Public Law 104-106, requires the sale of Elk Hills, 
Reserve No. 1, located in Bakersfield, California no later than 
February 10, 1998. Based on this schedule, the budget request 
provides funding for seven and one-half months of operations 
for NPR-1, including a transition period and full year funding 
for NPR-3 and the Naval Oil Shale Reserves. Available current 
and prior year funds will be invested in the current year to 
conduct sale activities.
    The Department is on track for completion of the Elk Hills 
sale as set forth by statute. Sufficient safeguards have been 
put into place to ensure that Elk Hills will not be sold unless 
the Government receives maximum value for the field. The 
statute requires the Department to hire five experts in the 
valuation of oil and gas fields to assess the value of Elk 
Hills under continued Government ownership. The Department may 
not sell Elk Hills for an amount less than the higher of the 
average of the five assessments, or the average of the middle 
three assessments (excluding the high and low assessments).

                   energy information administration

    The fiscal year 1998 request for the EIA totals $67.8 
million, comprised of $62.8 million in direct appropriations 
and $5 million in activities coordinated through the Office of 
Energy Efficiency and Renewable Energy. This level of funding 
will continue to support the data and analysis requirements of 
EIA's wide variety of customers with a streamlined portfolio of 
products in comparison to prior years.
    In fiscal year 1998, EIA estimates that it will produce 
approximately 240 reports and analyses covering a wide variety 
of energy issues. The office anticipates the need to address 
approximately 300,000 inquiries and requests for energy 
information in fiscal year 1998 alone. The most significant 
change to EIA's core activities in the fiscal year 1998 request 
is the proposed addition of analysis and data collection in 
response to electric industry restructuring. Several changes 
are also proposed which will significantly alter the depth and 
scope of EIA's traditional programs by fiscal year 1998. These 
include: elimination or scale back of several publications; 
elimination or reduced frequency of data collections; 
elimination of the in-house mainframe computer; and release of 
the Residential Energy Consumption Survey on a quadrennial, 
rather than triennial basis. The funding proposed as an 
appropriation from the Office of Energy Efficiency and 
Renewable Energy will support the core EIA data and modeling 
activities needed to support energy efficiency program needs 
and measure program results.

                     office of hearings and appeals

    The Department requests level funding of $2.7 million to 
continue to process and resolve applications for refund 
requests and other petroleum overcharge activities required 
under the Emergency Petroleum Allocation Act of 1973. The 
request will support personnel compensation and benefits, 
travel expenses, and support services within the Department's 
Working Capital Fund for rent, supplies, printing, and 
information technology.

                          a balanced portfolio

    The Department's fiscal year 1998 budget request represents 
a balanced portfolio of investments in energy technologies 
required for the nation's advancement into the 21st century. 
This budget request stays on course to ensure that America's 
future includes sufficient supplies of energy needed to fuel a 
growing economy without sacrificing environmental quality. Now 
is the time to maintain the government's investment in energy 
technologies and finally deliver the benefits of these long-
term efforts to the American people. These investments are 
critical, now more than ever.
                                ------                                


              Biographical Sketch of Hon. Federico F. Pena

    Federico F. Pena, the 12th U.S. Secretary of 
Transportation, compiled an outstanding record of increasing 
the global competitiveness of the transportation industry, 
improving the safety of travel, and streamlining the Department 
of Transportation, while investing more in America's 
infrastructure than any Secretary in history.
    In the area of global competitiveness, the transportation 
sector is the healthiest it has been in decades; 500,000 of the 
10 million jobs created since President Clinton took office are 
in transportation services.
    Secretary Pena helped revitalize the U.S. airline industry 
and signed aviation agreements with 40 nations opening 
lucrative markets for American airlines and cargo carriers and 
promoted easier travel for Americans and tourists to the U.S. 
At the President's request, he conducted commercial diplomacy 
efforts around the world, and he was credited with helping 
American businesses sell billions of dollars in exports to Asia 
and the Middle East. He also orchestrated for President Clinton 
the revitalization of shipbuilding, leading to the sale of the 
first American-made large vessels to foreign countries in 38 
years.
    He was responsible for bringing airline consumers the same 
level of safety for all flights--from jumbo jets to a 10-
seater, and he spurred the truck, bus, and rail industries to 
promote safety.
    As for streamlining the Department of Transportation, 
Secretary Pena downsized the work force by 11,000 positions, 
while upsizing investments in America's infrastructure by 10 
percent. He rewrote the rule book on financing highway 
projects, which encouraged private financing and sped up 
construction of more than 75 projects by 2 or 3 years at no 
cost to the Federal taxpayer.
    He also led the way for cities to use new technologies to 
manage traffic congestion and set a national goal to cut 
American's commute time by 15 percent in a decade; and he 
emphasized consumer protection, by improving an auto safety 
hotline and ensuring proper airline ticketing and advertising 
practices.
    As the Service Secretary for the U.S. Coast Guard, he 
provided leadership for the nation's fifth armed service to 
save lives and protect our environment. On his watch, the Coast 
Guard rescued 56,000 Haitian and Cuban boat people, and fought 
devastating floods and hurricanes.
    From 1983-91, he was Mayor of Denver leading an urban and 
economic renaissance, reversing Denver's mid-1980's decline 
through a series of bold initiatives. Most notably, he won 
approval for the construction of one of the largest and most 
technologically advanced airports in the world, Denver 
International, which, as Secretary of Transportation, he 
dedicated in February 1995.
    Pena also has served as a Colorado legislator and a civil 
rights lawyer.
    He has received many honors. In 1995, he was named Father 
of the Year by the National Father's Day Committee. In 1994, 
the American Subcontractors Association of Colorado named him 
Man of the Year, and he received the Senor Internacional Award 
from LULAC Council 12, the American Heritage Award from the 
Mountain State Anti-Defamation League, the National Leadership 
and Service Award from the Travelers Aid Society of Washington, 
and the Person of the Year Award from the American Association 
of Port Authorities.
    Secretary Pena did his undergraduate work at the University 
of Texas, where he also received his law degree. Florida 
International University awarded him an Honorary Doctor of 
Public Service degree in 1995.
    Born in Laredo, Texas, in 1947, Secretary Pena is the third 
of six children of a cotton broker. He and his wife, world-
class marathon runner and attorney Ellen Hart Pena, live with 
their two children in Alexandria, VA.
                                ------                                


               Biographical Sketch of Robert S. Kripowicz

    Robert S. Kripowicz was appointed U.S. DOE Principal Deputy 
Assistant Secretary for Fossil Energy on March 4, 1996. As 
Principal Deputy Assistant Secretary he is assisting the 
Assistant Secretary for Fossil Energy with the internal 
development of a working budget and the external negotiations 
with appropriators in Congress. Mr. Kripowicz will also help 
the Assistant Secretary with strategic planning. One of his 
main duties will be to build a unified focus for the Fossil 
Energy coal, oil and natural gas programs for the long term.
    Mr. Kripowicz previously was appointed Acting Deputy 
Assistant Secretary for House Liaison in April 1995. As House 
Liaison he was responsible for coordinating all interactions 
with members and staff of the House of Representatives on 
departmental programs. He was also responsible for establishing 
legislative and budget strategies and for coordination of 
hearings, floor, and conference action on all legislation in 
the House affecting the Department.
    Previously, he was appointed Deputy Assistant Secretary for 
Building Technologies in January 1995. The Office of Building 
Technologies, within the Office of Energy Efficiency and 
Renewable Energy, is responsible for Department of Energy's 
(DOE) programs to increase the energy efficiency of the 
nations's residential and commercial heating and cooling 
systems; solar systems; high efficiency lighting, windows, and 
equipment; and advanced building materials.
    Prior to joining DOE, Mr. Kripowicz was on the staff of the 
House Interior and Related Agencies Subcommittee of the 
Committee on Appropriations. He was responsible for 
appropriations for DOE programs in energy efficiency, fossil 
energy, clean coal technology, and Strategic and Naval 
Petroleum Reserve activities, as well as Interior Department 
energy, scientific, and land management programs. He also 
served as Staff Director of the House Energy Subcommittee of 
the Committee on Science and Technology, responsible for energy 
efficiency, renewables, fossil energy, high energy and nuclear 
physics, and basic science programs at DOE.
    Mr. Kripowicz began his government career in the early 
1970's in program analysis and budgeting activities at the 
Atomic Energy and Nuclear Energy Commissions and the Energy 
Research and Development Administration.
    In the private sector, Mr. Kripowicz managed research and 
development programs at Mechanical Technology Inc.; 
construction contracts for Consolidated Edison of New York; and 
financial planning and budgeting at NUMEC, a nuclear subsidiary 
of ARCO, and was a chemist for Dupont. He also served as an 
officer in the United States Army. Mr. Kripowicz received his 
B.S. in chemistry (cum laude) from Lafayette College in 1963, 
and his M.B.A. from the University of Pittsburgh in 1970. A 
native of Butler, Pennsylvania, Mr. Kripowicz currently resides 
in Silver Spring, Maryland.
                                ------                                


                   Biographical Sketch of Joseph Romm

    Dr. Joseph Romm was named Acting Principal Deputy Assistant 
Secretary for Energy Efficiency and Renewable Energy in August 
1995. In this capacity, Romm helps the Assistant Secretary, 
Christine Ervin, manage the $800 million portfolio of research, 
development, and deployment of clean industrial, 
transportation, building, and utility technologies. He is co-
author, with Deputy Secretary Charles Curtis, of the April 1996 
Atlantic Monthly cover story, ``Mideast Oil Forever.''
    From July 1993 to July 1995, Romm was special assistant for 
policy and planning to the Deputy Secretary of the U.S. 
Department of Energy, where he advised the Deputy on energy 
efficiency, renewable energy, pollution prevention, and 
industrial competitiveness. He served as the Executive Director 
of the Department's Pollution Prevention and Waste Minimization 
Executive Board, which works to minimize the Department's own 
waste stream and to coordinate its pollution prevention R&D.
    Romm is author of the recent book Lean and Clean 
Management: How to Increase Profits and Productivity by 
Reducing Pollution (Kodansha, 1994), a ``how to'' book for 
companies that want to improve their energy and environmental 
performance. The book documents two dozen case studies of 
companies that have increased productivity through energy-
efficient building and office design, industrial energy 
efficiency, of pollution prevention.
    From mid-1991 to mid-1993, Romm worked with Amory Lovins at 
Rocky Mountain Institute. Romm holds a Ph.D., in physics from 
M.I.T., and has written about pollution prevention and 
manufacturing for Forbes, Technology Review, Foreign Affairs, 
Industrial, the New York Times, and USA Today.
                                ------                                


              Biographical Sketch of Elizabeth E. Smedley

    Elizabeth E. Smedley was appointed Controller for the U.S. 
Department of Energy (DOE) on September 6, 1985 and named 
Acting Chief Financial Officer (CFO) when the Department 
established a CFO organization in August 1991. She served in 
that capacity until DOE's first Presidentially appointed, 
Senate confirmed CFO, Joseph F. Vivona, was sworn in on July 
25, 1994. She was again named Acting CFO on January 17, 1997. 
As Acting CFO she manages the Department's budget and 
accounting operations which total over $20 billion in resources 
annually, as well as in the development of financial policy and 
for conducting a compliance review program which ensures that 
proper financial procedures are followed by Headquarters and 
field offices.
    Mrs. Smedley has been with DOE since December 30, 1979, 
serving first as the Director of the Office of Financial 
Policy, and then as Deputy Director, Office of Budget. She 
served as the Agency Budget Officer from June 1981 until June 
1983, and most recently, as Assistant Controller for Budget, 
Policy and Compliance.
    Prior to her assignment to DOE, Mrs. Smedley spent four and 
one-half years as Head of the Operating Forces Branch within 
the Office of the Comptroller of the Navy. In this position, 
she was responsible for formulation, defense and execution of 
the portion of the Navy Budget which provided operating funds 
for the Atlantic and Pacific fleets. From 1964 to 1975, she 
served in positions of increasing responsibility with the 
Public Health Service, Department of the Army, Defense 
Communications Agency, and Department of Navy.
    In recognition of her work at DOE, Mrs. Smedley received 
the rank of Distinguished Executive in the Senior Executive 
Service in 1982; the DOE Meritorious Service Award in 1984 and 
1990; the rank of Meritorious Executive in the Senior Executive 
Service in 1988; the Secretary's Award in January 1989; the 
Donald L. Scantlebury Memorial Award in 1989; and the Superior 
Performance Award in 1989, 1990, 1991 and 1992.
    Mrs. Smedley received a Bachelor of Arts degree in 
International Relations from Goucher College in 1964 and did 
graduate work in Business and Public Administration at George 
Washington University. She has been active in community 
affairs, and from 1969 to 1973, served in a part-time elected 
capacity as Councilwoman for the city of Bowie, Maryland.
    Born in Baltimore, Maryland on November 9, 1943, Mrs. 
Smedley currently resides in Boonsboro, Maryland. She is 
married to Jerry Morgan Smedley of Mishawaka, Indiana. They 
have four children: John, Jeremy, James, and Jennifer.

                              rocky flats

    Senator Campbell. Thank you. Let me come back to Rocky 
Flats for a minute, but based on your testimony, I think as you 
mentioned, the dependency we are now facing in getting up to 60 
percent I believe is the figure you mentioned, it really is 
unacceptable to me, too.
    You focused on production of natural gas, alternative 
fuels, efficiency, and so on. I commend you for that. I think 
that's all great.

                 naval petroleum and oil shale reserves

    One thing I did want to deal with a little bit is the study 
that was due from the Department of Energy. I know you did not 
have anything to do with it, you were not there, but we did 
request a study sometime ago, and it was supposed to be 
delivered to us last summer on the Naval petroleum and oil 
shale reserves.
    We have yet to get it, and yet we have seen some press 
releases and copies of memorandums that were released to the 
press that said that that had been done sometime ago. I was 
wondering if you know why we had not got it yet.
    Secretary Pena. Mr. Chairman, I am aware generally of the 
problem. It is not completed, and I understand that staff has 
had conversations with others about the delay, and it is my 
understanding that the report will be finished in a very timely 
fashion, I hope in the next few months.
    Mr. Kripowicz. Actually by the end of March.
    Secretary Pena. The end of this month hopefully.
    Senator Campbell. The end of March? OK. I would appreciate 
if you would focus on that and make sure we get one.
    Secretary Pena. We will. We think it's very important and 
we want to comply with the requirements.
    Senator Campbell. It is also my understanding that the 
Department plans on introducing some legislation disposing of 
the oil shale reserves. I would draw your attention to a bill 
that I introduced that I will probably be reintroducing that 
would transfer the authority from Department of Energy to the 
Department of Interior to lease the natural gas that may 
measure in the trillions of cubic feet under the oil reserves.
    We did not really get anywhere in the 104th with that bill, 
but we are going to try to move that this time with your input.
    My question really is, first of all, is the administration 
going to introduce some legislation to sell the oil shale 
reserves or part of it?
    Secretary Pena. Mr. Chairman, I do not believe we are yet 
at the stage of proposing legislation for the specific purpose 
of leasing or selling the oil shale reserves. However, we are 
very aware of the issues you have raised in this regard.
    The Department has had preliminary conversations with the 
Department of Interior pursuant to the suggestion you raised, I 
believe, last year about how one might go about looking at 
either, if not sell, a lease of the minerals in that part of 
the reserve. We're going to continue those conversations.
    I believe that by bringing in some independent experts we 
can get better judgment about that. In the context of an 
overall report that the Department will be providing to the 
Congress I think in September of this year dealing with the 
whole naval petroleum reserve and other reserves, I think we'll 
be able to comment much more specifically about the direction 
we're going to head in, but I would be pleased to work with you 
on that. I know it's a high interest of yours to determine how 
we can best approach that particular problem.
    Senator Campbell. I know we are catching you a little bit 
flat-footed, but I was wondering if there had been any dialog 
with the environmental community. I was worried about wildlife, 
the ranchers that have grazing permits in that area and a 
number of other things, but I assume you will be taking all 
those into consideration and visiting with them at least before 
we----
    Secretary Pena. That is correct, Mr. Chairman, and there 
are some concerns that have been raised, particularly about 
subsurface treatment. Of course, we do have some issues we are 
raising with the Department of Interior. Again, we hope to 
resolve those. Now that I'm official I can have those 
conversations with my good friend Bruce Babbitt to see how we 
can address this issue.

                     national renewable energy lab

    Senator Campbell. Thank you. In addition, you know that the 
National Renewable Energy Lab is very important in our State, 
in fact very important to the Nation. They have done just some 
marvelous research there. I visited two or three times and was 
really impressed with some of the new technology that they are 
developing. Could you perhaps explain a little more in detail 
about the funding for the National Energy Resource Lab or 
perhaps your colleagues can.
    Secretary Pena. Let me start, Mr. Chairman. I guess 
fortunately I'm also familiar with that very important lab 
since it's in Colorado, and I remember the very fine work it 
has done over the years, as you have, and I look forward to 
perhaps taking some time to visit again with you when you have 
some time and we can both be there together. That's a very high 
priority lab for us. We want to continue to be supportive in 
terms of funding. As far as I know our funding is in good 
shape. Let me ask Mr. Romm if he wants to add to that.
    Senator Campbell. Would you identify yourself for the 
record.
    Mr. Romm. Sure. Dr. Joseph Romm, the principal Deputy 
Assistant Secretary for Energy Efficiency and Renewable Energy 
at the Department.
    Yes; we have requested in the energy and water account, 
roughly a $70 to $80 million increase in renewable energy 
technologies over fiscal year 1997. Much of this is either done 
at the National Renewable Energy Lab or passes through, and 
they help manage that, so a pretty significant increase in 
renewable energy funding.
    Senator Campbell. Thank you. Senator Byrd, do you have some 
comments or questions, please?

                             fossil energy

    Senator Byrd. Thank you, Mr. Chairman. Mr. Secretary, I 
join with others in congratulating you on your new assignment 
and wishing you well.
    The use of energy in so many facets of the daily routines 
of the American public has a huge impact on the U.S. economy. 
The Energy Information Administration estimates that end users 
of energy spend $560 billion per year in the United States. 
Thus our energy security has a direct bearing on our economic 
and national security. These factors, when coupled with the 
environmental concerns associated with energy use, are at the 
root of the programs that are supported by the DOE budget.
    Is it accurate that fossil fuels are the dominant source of 
energy in the United States and are projected to remain so in 
the foreseeable future?
    Secretary Pena. That is correct, Senator Byrd.
    Senator Byrd. Would you agree that based on the 
Department's own projections there remains a very important 
role for fossil fuels and particularly for coal in meeting our 
energy requirements for the future?
    Secretary Pena. We agree with that statement. I personally 
agree with that statement, Senator, and that's why we're very 
supportive of the Clean Coal Program in particular.
    Senator Byrd. How will the program investments in the 
fossil energy budget help us to continue to meet the demand for 
energy in this country?
    Secretary Pena. Senator, in a number of ways. First of all, 
as I stated in my testimony, we will continue to be supportive 
of the Clean Coal Technology Program, which is a demonstrated 
success. We believe the efficiencies we have already 
demonstrated in that program where we have 40 individual 
projects, 20 of which have been completed, 20 which are now 
either in construction design or in operation are all, we 
think, going to have the potential for increasing the viability 
of the use of clean coal in the future. It is a very important 
part of that strategy.
    The remainder of the investment we are making in other 
clean energy programs will do the same in other technologies. 
We believe that given what we are observing in the private 
sector, which is a decrease in the amount of investment for 
research and development, that as a matter of national policy, 
we as a government, as an American people need to make a 
decision about how much more we want to ensure that research 
and development, particularly in the long term, in this very 
important area, continues to be a high priority, so that we are 
not left behind, particularly compared to our competitors in 
Germany and Japan, which are making, at least compared to GDP, 
higher if not comparable investments in this kind of research 
and development.
    It is my judgment that we need to continue to make this 
research and development investment. It is good for the 
country. It sustains a very important public policy, and given 
the conversations we had this morning about the need to 
establish an energy independent strategy for our country, this 
is a very important part of that strategy.
    Senator Byrd. I am glad to hear you say that, Mr. 
Secretary. I am concerned about the impact that the proposed 
fiscal year 1998 funding levels for fossil energy will have on 
our ability to complete development of some of the major 
technologies in a timely manner. What makes this a particular 
concern is that increased funding is proposed in other areas of 
the Department of Energy budget.
    One of the largest programmatic increases requested for 
fiscal year 1998 is for the energy efficiency programs within 
the Interior bill which are proposed to grow by nearly 25 
percent above the fiscal year 1997 level.

              renewable energy--use and future projections

    How much of our current energy use is from renewable 
sources and what are the future projections?
    Secretary Pena. Senator, I would be happy to get you the 
specific estimates of what our current renewable energy use is 
and what our projections are. Let me generally state and agree 
that they are not at the levels that we would like them to be.
    [The information follows:]

              Renewable Energy--Use and Future Projections

    Current U.S. renewable energy capability is over 93 
gigawatts. Nearly 85 percent of that is conventional 
hydropower. Future use of renewables is dependent on economic 
growth, rate of technology introduction, the price of oil and 
other factors affecting market penetration of nonhydro 
renewables. Minimally we expect the 15 gigawatts of nonhydro 
renewable capacity to at least double by 2015. In the Office of 
Energy Efficiency and Renewable Energy's aggressive technology 
and market penetration approach we expect installed capacity of 
more than 30 gigawatts and as high as 40 gigawatts 5 years 
sooner, by 2010. In most every scenario, nonhydro renewables 
are expected to comprise virtually all the domestic growth in 
the utility sector's use of renewables. As a point of 
reference, Royal Dutch Shell Oil Co.'s strategic planning 
group's growth scenario expects the world's renewable use to 
increase on the order of fivefold by 2015.

                 decrease in domestic production of oil

    Secretary Pena. However, we fundamentally have two problems 
we must face. One is the fact that we are seeing a decrease in 
domestic production of oil in particular, and that slope 
continues to go down, and second, we continue to see a very 
significant increase in consumption of energy.
    If we do nothing and allow those two trends to continue 
over the next 10 or 15 years, we are going to be even more 
energy insecure. So our approach in the budget we have 
submitted is to deal with both, the production side and the 
consumption side.
    We address the consumption side by our increased investment 
in energy efficiency. We can detail that with more specificity, 
and by continuing to work on the production side.
    I stated several weeks ago in one of my confirmation 
hearings that one of my priorities will be to establish a 
credible and specific strategy on the production side to find a 
way, if at all possible, however difficult it might be, to get 
us to a position of becoming more energy independent, and that 
includes having timetables and targets and measurements and 
evaluation of our progress over a period of years. It will be a 
combination of both consumption and production strategies which 
I think we as a nation need now rather than waiting for the 
next century when we have a real crisis.

                 energy efficiency and renewable energy

    Senator Byrd. What funding is proposed in the fiscal year 
1998 budget in total for efficiency and renewable energy 
research and development?
    Secretary Pena. In the area of energy efficiency, 
approximately $517 million for research and development. I'm 
sorry, Senator, the first part of your question was?
    Senator Byrd. What funding is proposed in total for 
efficiency and renewable energy research and development?
    Secretary Pena. The total amount, Senator Byrd, is a little 
over $1 billion, $1.017.4 billion in total.
    Senator Byrd. For energy efficiency and renewable energy 
programs. So the budget proposes to spend about $1 billion on 
programs that account for about 8 percent of our energy use. We 
are talking here about the nonnuclear, nonfossil sources; $1 
billion on programs that account for about 8 percent of our 
energy use and about $350 million for programs that account for 
85 percent of our energy consumption, we're talking there about 
fossil fuel. Now, to me that seems out of balance. What is your 
perspective?
    Secretary Pena. Senator, I think we may have a 
misunderstanding of how you have reached your particular 
calculation, and we would be happy to sit down with you to have 
a better understanding of what we are trying to compare. Mr. 
Romm is indicating to me that there may be a different way in 
which we're characterizing that, and if I may ask him to at 
least share with you the way we're looking at that particular 
question, let's try to answer it for you.
    Mr. Romm. Senator Byrd, the efficiency and renewables 
budget does not all go toward renewable energy, which 
constitutes, as you know, just a few percent of the Nation's 
energy supply. Most of the $1 billion goes toward the efficient 
use of energy, most of which is fossil fuels, if you see what 
I'm saying.
    We work on automobiles that run on gasoline more 
efficiently, we work on gas turbines that industry might use, 
and we support technologies that would use electricity more 
efficiently. I would say the bulk of the technologies in the 
efficiency side which the Interior Committee supports are, in 
fact, for the efficient use of fossil energy, and, therefore, I 
don't think it's correct to characterize our $1 billion as 
going toward supporting technologies that just constitute a few 
percent of the Nation's energy supply.
    Senator Byrd. What type of reductions in our use of fossil 
fuels does the Department anticipate as a result of the energy 
efficiency improvements? What do you think will result from the 
energy efficiency improvements with respect to the kinds of 
reductions in the use of fossil fuels that will come about?
    Secretary Pena. Senator, let me, if I might, come back and 
answer that question more specifically, and let me give you a 
general answer now. One of the questions that I have been 
asking as the new Secretary of Energy is this: As we make 
multimillion dollar investments in these strategies, I believe 
it is incumbent upon us to give you and the American people a 
much more specific answer on what we are producing, what is the 
product of these investments.
    The question you're asking is one that I have been asking, 
too, and so let me at least today ask that I come back to you 
with a much more specific answer to that question. It is a very 
important question, one that I need to refine with my 
colleagues at the Department of Energy.

             federal energy technology center consolidation

    Senator Byrd. Very well. In response to--let us talk just 
briefly about Morgantown, the Federal Energy Technology Center. 
In response to declining budgets and pressures for changes in 
the way that the DOE does business, last year Congress and the 
administration reached an agreement regarding changes in the 
Fossil Energy Program. As a result of this the Morgantown and 
the Pittsburgh Energy Technology Centers are being consolidated 
as one administrative organization with two sites, two 
locations.
    This new entity is being called FETC, F-E-T-C, the Federal 
Energy Technology Center [FETC]. Could you state for the 
record, now, what is the status of the consolidation, what 
major hurdles have been cleared, and what are the next big 
issues to be addressed?
    Secretary Pena. Senator, generally speaking, the 
consolidation is moving on a timely path and is meeting its 
objectives. We believe that with the consolidation we'll be 
able to reduce both our administrative overhead and some of the 
cost of duplicative contracting services at both facilities.
    We have some money in the budget for 1998 to make sure we 
have a smooth transition so that we will avoid any major 
disruptions, as we have discussed before. We know that there 
may be some concerns that in the event we don't meet our 
milestones, there may be some problems.
    We will watch that very carefully and obviously work with 
you because of your great concern there and make sure that we 
meet those milestones. As of today I've been informed that we 
are on target, the program and the consolidation are moving 
smoothly, and we expect to meet the milestones that we set out 
in the consolidation to begin with.
    Senator Byrd. Would you agree that we need to remain 
flexible in terms of providing FETC the resources necessary to 
chart its new course in a manner that is as minimally 
disruptive as possible to the two sites?
    Secretary Pena. Yes; I would, Senator. Again, we think that 
the money we have in the budget for this year to reach our goal 
of the consolidation is the appropriate amount. However, as we 
go through this process, if we determine that for some reason 
we're not meeting our goals and there needs to be an 
adjustment, we will obviously take appropriate action and work 
with you on that matter.

              federal energy technology program direction

    Senator Byrd. I appreciate that very much, Mr. Secretary. 
The budget proposes a reduction of $6.2 million in fiscal year 
1998 for the FETC program direction budget, and I hope you will 
keep me fully apprised as to whether the remaining funding will 
be sufficient to allow the consolidation to proceed in an 
orderly way. You have indicated already that that is what you 
expect to do, but we will talk about it and work together on 
it.
    Secretary Pena. We will do that, Senator.
    Senator Byrd. I would like to touch on one other program 
area that is important to the Federal Energy Technology Center. 
How much time do I have left?
    Senator Campbell. We haven't been timing it, Senator, but 
we might--I don't know how long Senator Domenici can stay, but 
we might go to him and come back to you depending on how long 
you will be.
    Senator Domenici. That is all right, Senator. Thank you.
    Senator Campbell. All right.

             environmental management program at morgantown

    Senator Byrd. I would like to touch on one other program. 
That is with respect to environmental management and the 
technology development program. While funding comes from the 
Energy and Water appropriations bill, which is chaired by the 
distinguished Senator from New Mexico, Mr. Domenici, the 
environmental management program plays a strong role in helping 
FETC to have a diverse portfolio that works for many different 
clients within the Department of Energy.
    Morgantown currently manages some $85 million annually in 
environmental management programs to develop new technologies 
for use in the cleanup of environmental contamination resulting 
from nuclear weapons production. FETC brings some unique 
capabilities to this program--vast experience in implementing 
projects with industry and other governmental organizations 
that involve creative and complicated contractual arrangements, 
broad technical and engineering expertise, and an ability to be 
an objective partner in the decisionmaking process.
    So, given the strengths that FETC can bring to the 
Environmental Management Program, is this a partnership that 
the Department will continue to support?
    Secretary Pena. Senator, generally speaking, the answer is 
``yes.'' We think there is an important role in the 
environmental management area and whatever contributions FETC 
can make, we believe we can continue to work with the 
organization.
    Senator Byrd. Very well. One of the successes in FETC's 
participation in the Environmental Management Program has been 
its use of the capabilities of the International Union of 
Operating Engineers Hazardous Materials Center in Beckley, WV. 
How has this partnership benefited the environmental management 
program?
    Secretary Pena. Senator, I'm going to have to turn to my 
associates here. I'm not familiar with that particular 
relationship. Let me ask Mr. Kripowicz to talk about that.
    Mr. Kripowicz. Bob Kripowicz. The particular contract looks 
at human factors, engineering, and hazardous waste operations, 
and we find that to be very valuable to the cleanup of our 
nuclear sites that have contamination problems, and that has 
been a very successful operation with the operating engineers.
    Senator Byrd. It is because of the people's concerns about 
the safety issues that are associated with handling 
contaminated materials. I am glad to hear that you feel that 
the center has been helpful in addressing the end user issues 
associated with the Environmental Management Program.
    Well, I close, Mr. Secretary, by thanking you for your 
testimony, and I look forward to working with you in support of 
programs that will contribute to the continued use of coal 
through more efficient power generation systems and improved 
environmental performance.
    The Federal Energy Technology Center plays a key role in 
fostering these technologies. The facility in Morgantown 
employs some 550 persons, so I will stand ever vigilant to 
protect its role in promoting advanced fossil energy 
technologies. While the fossil energy budget is a relatively 
small part of the overall DOE budget, I encourage you to take 
an active role within the administration in defending this 
program against budget reductions and policy decisions that 
will jeopardize our ability to prepare for the energy 
challenges of the next century.
    I am somewhat troubled by indications that the 
administration is not fully involving the Department of Energy 
and its vast expertise when policies and regulations are 
considered that will have a considerable impact on the energy 
producing and consuming aspects of our economy.
    With respect to the budget, I will be working with Chairman 
Gorton to ensure that the subcommittee takes an approach to our 
energy research and development programs that is consistent 
with where our energy comes from and how we use our energy.
    While dollars are constrained, I do not believe that this 
is the time for us to abandon our support of the technology 
development efforts already underway. We need to complete these 
programs so that the technologies will be commercially 
available in a timely manner to help us meet multiple goals.
    Now, I have additional questions that with your permission, 
Mr. Chairman, the permission of the subcommittee, I would like 
to have answered for the record.
    Senator Campbell. Without objection.
    Senator Byrd. Thank you again, Mr. Secretary. I thank your 
associates, and I thank Senator Domenici for his characteristic 
courtesy in allowing me to proceed and thank you, Mr. Chairman.
    Senator Campbell. We will now turn to the Senator who has 
corrected many of our colleagues on the pronunciation of your 
name.
    Senator Domenici.

                  opening remarks of senator domenici

    Senator Domenici. We did have a good time, Mr. Secretary, 
the other day in full session, a lot of people there. Did you 
hear about that morning we had in the Energy Committee?
    Senator Campbell. He was not there that morning.
    Senator Domenici. I know, but have you heard about it?
    Secretary Pena. Generally I have.
    Senator Domenici. Well, there was a huge crowd, you know, 
and I thought they were all there just because we were going to 
approve your nomination. They were there for an electric 
generating reform seminar, so we had lobbyists from all over 
and all these great Senators called you by your wrong name. So 
I told them how to say it. I said it's very simple, like pen, a 
fountain pen, with a y-a, Pena. I think we're getting it.
    Secretary Pena. Thank you very much, Senator.
    Senator Domenici. Mr. Secretary, first, I am glad you are 
here. I am hopeful that the long wait, with all its pressures 
have not been too difficult on you and your family, especially 
with your wife being pregnant. I hope she is feeling well and 
that everything is going fine.
    Secretary Pena. She is, Senator. Thank you for your 
thoughts.
    Senator Domenici. Please tell her that for me, will you?
    Secretary Pena. I will.
    Senator Domenici. I am glad Senator Byrd is still here, and 
I want to give you, my good friend, an observation about what 
is probably not going to happen with the President announcing 
what he has about the Consumer Price Index. I believe any 
chance of getting a negotiated budget agreement between the 
Republicans and the President are finished. I believe----
    Senator Byrd. Why are you telling me this?
    Senator Domenici. Well, because I want to tell you what is 
probably going to happen. It does not sound too good.
    Senator Byrd. Why are you singling me out to be the victim?

            increases in fiscal year 1998 president's budget

    Senator Domenici. I think that perhaps you might be able to 
carry a message. I note here, Mr. Secretary, the President's 
request in energy conservation, represents a 24-percent 
increase.
    Senator Byrd. I am not a homing pigeon.
    Senator Domenici. The President's request for energy 
conservation research and development----
    Senator Byrd. They carry messages.
    Senator Domenici [continuing]. Represents a 24-percent 
increase; the transportation sector, a 16-percent increase; 
industrial sector, a 19-percent increase. Oh, here is a good 
one. Federal energy management, it is not a big account, but it 
has a 57-percent increase. Policy management, a 20-percent 
increase. Well, I have a whole list, but that is just a 
smattering.
    Let me say to the subcommittee, and I am preaching to the 
choir in terms of my good friend the chairman because he 
understands as a member of the Budget Committee, that it seems 
to me we are left with no alternative other than to freeze 
discretionary appropriations for 5 years, and that probably 
means that all of these things we talked about here are gone. 
Forget about 24 percent increases and 19 and 16, and so on.
    A freeze means a freeze. It means no more to spend 1 year 
than the next, and spend no more this year than last. It means, 
Mr. Chairman, that you have got competing interests, so some 
have to go up because they must, which means some have got to 
go down even below a freeze.
    Now anybody that knows me understands that this is not my 
desire, but I am going to tell you right now, and I am telling 
the public from this day forward, this President's budget puts 
Republicans in a position where they have no alternative.
    The President will not cut entitlement programs. If we 
touch them, it will be the end of the world. He has cut 
Medicare $82 billion and claims it is $100 billion, and one-
half of that is phony. We have to produce a balanced budget. He 
is $160 billion off the mark on economics in the same period of 
time, and we are supposed to produce a budget.
    Well, we will do one. Just be patient. We will do one, and 
I am guaranteeing you when we are finished, it is not going to 
be a pleasant life for the President and all these programs he 
wants. We will not be dumb because we will not cut the programs 
that he wants to resonate out there with the public. We will 
increase them. Let us see where the rest of it goes. Let us see 
where the Department of Commerce goes. I just came from one of 
the subcommittee meetings there. It might mean a nice 20 
percent cut after you pay the personnel.
    Senator Byrd. I have a suggestion.
    Senator Domenici. Well, I am finished and I hope you do. I 
only have two little questions.
    Senator Byrd. My suggestion would be that the President and 
the Republicans back off from their proposals to cut taxes at 
this time.
    Senator Domenici. My distinguished friend, let me suggest 
that while I am not prepared to tell you that you are right, 
what I have just described is the case even if we do not cut 
taxes because of the lack of entitlement savings and the desire 
to get the budget balanced in 5 years. What I have just given 
you assumes no tax increase.
    Senator Gorton [presiding]. No tax cuts.
    Senator Domenici. Excuse me, no tax cuts. Now, having said 
that--and thank you for the thought.
    Senator Byrd. Thank you.

                           sale of elk hills

    Senator Domenici. Now let me ask you about the Elk Hills 
Naval Petroleum Reserve. Are you familiar with it?
    Secretary Pena. Yes; I am, Senator.
    Senator Domenici. For many years we have been trying to do 
something about this. It is never the right time, but I guess 
we finally authorized the sale last year as part of the defense 
authorization bill. Could you tell the committee where are we 
in this sale? Is it going to be completed? I think we mandated 
it in February 1998.
    Secretary Pena. That's correct.
    Senator Domenici. Could you tell us about that, please.
    Secretary Pena. I can, Senator. I've been briefed about 
this. Generally speaking, the work we have to do in complying 
with the congressional requirements for having the sale is 
moving along. In particular, we have already hired an outside 
financial advisor as required by the statutory guidance. We 
have hired five independent experts and will be doing the five 
independent analyses. These independent analyses will be used 
to formulate the minimum price, which cannot be lower than the 
higher of the average of the five or the middle three 
evaluations.
    We are having discussions, as you know, with our partner we 
have in this, which is one particular oil company, but we are 
moving along with this, and at this point our target is still 
to comply with the February target.

                      strategic petroleum reserve

    Senator Domenici. One last question. The President's budget 
proposes to sell $1.145 billion of oil from the strategic 
petroleum reserve. Are you aware of that or----
    Secretary Pena. Yes; I am, Senator, I think that's in 2002?
    Senator Domenici. Right. Now, the way it is structured, 
that is a mandatory spending proposal. Are you all familiar 
with mandatory versus discretionary?
    Secretary Pena. I am, Senator. I think we are.
    Senator Domenici. Now it is going to be difficult--the 
chairman can speak for himself and look at it perhaps even much 
more in depth--but it's going to be difficult to meet the 
subcommittee's 602(b) allocation and continue to fund the DOE 
programs at the 1997 level which included a $220 million offset 
from these oil sales.
    In your opinion, which would be preferable, selling the 
$220 million of the strategic petroleum reserve to fund its 
appropriation or reducing DOE's other programs by $220 million?
    Secretary Pena. Senator, neither. Let me try to answer your 
question more specifically.
    Senator Domenici. I gathered that.
    Secretary Pena. No. 1, it is at least my view, and I 
believe the administration's general view, that we not make 
additional sales from the strategic petroleum reserve. Later on 
this year, I believe in October, we will present a report for 
the Congress on the overall administration's position on the 
reserve. I believe the reserve is very important. We have only 
67 of 90 days of net import equivalent in the reserve today. 
There have been sales in the reserve. Some proposed by the 
administration, some by the Congress.
    Senator Domenici. Yes.
    Secretary Pena. But I think now that the dust has settled 
from those sales, and as we all begin to focus on the need to 
develop an energy independence strategy, the need for the 
reserve looms even greater. So let me respectfully suggest, 
Senator Domenici, that while there is the mark in 2002 for the 
sale of over $1.1 billion in the reserve, that that is a mark, 
and it will be my view, at least, that we have some discussions 
within the administration about how we can look to other 
options other than that mark.
    It is a ways out. There is time to make adjustments, and as 
you know in this multiyear budget sometimes some of these place 
markers are there for a reason, but I think that--I believe we 
ought to at least look for other ways of dealing with that kind 
of a cut.
    Senator Domenici. Mr. Chairman, I guess you know I would 
agree with that last statement. I do not know how you feel, 
but, you know, I think we are perpetrating somewhat of a fraud 
on the American people.
    We spend all their money telling them we need this big oil 
reserve and we go through all these expenditures and every time 
we run into a budget crunch we sell some oil. The world did not 
change any. The world is the same old world, oil dependence is 
growing.
    But that is $1.145 billion more that the President's budget 
is off in the year 2002. It is already off $70 billion, so now 
we throw this one away, that is $71 billion. I mean, everywhere 
we turn it is one of these kind of things we find in this 
budget.

                    increases in president's budget

    Since I talked about it, I think I should be fair and say 
to my good friend Senator Byrd that it is most interesting, the 
President's budget has the deficit going up $25 billion under a 
steady-as-you-go, growing economy next year over this year, $25 
billion. I do not understand how that is deficit reduction.
    In fact, deficits do not significantly start down until the 
fourth year. So obviously these budgets are full of these 
increases--16 percent, 20 percent, 12 percent, and so on.
    I just came from Commerce. The whole Commerce Department is 
up 12.4 percent in the budget. Did you know that, Slade? It is 
just a big fat budget. Now we are going to have to change it, 
and the President is going to say, I could pay for all that 
stuff. You are all bad guys up there.
    If I sound a little bit upset with the situation, I am. I 
am going to do my share to do what is right. I do not want to 
cut discretionary spending, but I do not know how else we can 
do it. Thanks for the time.
    Senator Byrd. Well, we have already cut it to the bone. We 
have been cutting it to the bone for years, and I do not know 
how we can cut it much more. But I think it is absolutely folly 
to suggest that we ought to cut taxes, and I fault both parties 
for that, the administration as well as the Republican Party. 
It is no time to cut taxes. If we mean business about reducing 
the deficits, we ought to put that money on the deficit.
    Senator Gorton. Well, Senator Byrd, as Senator Domenici 
said, given the situation we are in today, I think you are 
going to get your way, but I do not think that is going to 
solve the problem that we are going to face in this 
subcommittee.
    First, Secretary Pena and Senator Byrd, I want to apologize 
for being late to my own wedding here, as it were, my own 
committee meeting. Only the importance I ascribe to the debate 
on the floor to emasculate the first amendment could have kept 
me away. Senator Domenici was there and knows the reason that I 
was there.
    But I do want to welcome you to this job publicly, as I 
have privately, and express my delight that you are finally in 
office. This I guess is your first public appearance, is it 
not, since you have been sworn in?
    Secretary Pena. That's correct, Mr. Chairman.
    Senator Gorton. Well, I find that to be delightful, and an 
honor to this subcommittee. As I also told you in our private 
conversation yesterday, this subcommittee has been a matter of 
real gratification to me as chairman, in large part because of 
the wonderful education and support that I have gotten from 
Senator Byrd, who is the repository of so much that is great 
about the history of our entire Senate and the way in which we 
operate here. I hope that this year we're going to continue to 
work together, even under very, very difficult circumstances.
    I'm not sure whether the materials that we gave you have in 
it this colored chart. Well, if it doesn't, we'll give it to 
you. When I took----
    Secretary Pena. Mr. Chairman, I was not provided any 
materials.

                       allocation to subcommittee

    Senator Gorton. OK. Well, when I took over this 
subcommittee, because I didn't understand an awful lot of it 
and because I thought pictures were so significant, I started 
putting together colored charts like this that show the overall 
appropriation allocation to this committee and where it goes, 
just so that we can understand it conceptually.
    Here you are, way down here in the orange for energy 
programs. Obviously the largest single use for our money is the 
various land management agencies--the Park Service, the Forest 
Service, and the Bureau of Land Management and the like--the 
heritage of the American people, and a field in which there is 
huge public interest, most particularly in the National Park 
Service.
    The second area is the unique responsibility that Congress 
and every administration has for Indian programs. And then we 
get to science programs, your own, finally even smaller than 
yours, cultural programs, which I know my two colleagues here 
agree with me create much more in the way of correspondence and 
calls from our constituents than is warranted by the absolute 
size of each of those appropriations. But because they have so 
much to do with the culture and the heritage of this country, 
they are very, very important, and that puts you in a tough 
situation.
    Your programs probably have smaller constituencies from the 
point of view of the general public than any of the other major 
or significant programs subject to the jurisdiction of this 
subcommittee.
    That's not for 1 minute to say that they're less important. 
I am convinced that a large number of them are of vital 
importance to the future of the country, but it does impose on 
you a set of challenges in dealing with Members of Congress in 
both Houses that's perhaps greater than the other Secretaries 
or administrators of these other programs.
    Second, I must, with great regret, join my colleague, 
Senator Domenici, in saying that I think the failure of the 
abortive but very sincere negotiations over an overall budget 
that result in an administration that does not want to make any 
significant changes in entitlement programs is likely, 
ultimately, to brutalize the discretionary appropriations 
process in general terms and very specifically in terms of this 
subcommittee.
    I want to say across party lines that I agree totally with 
Senator Byrd on the proposition that budget cuts over the 
course of the last several years have been very 
disproportionately imposed on discretionary spending, spending 
that goes to the education of our young people, to our own 
direct responsibilities as landowners, to the advancement of 
knowledge, to the building of our infrastructure.
    In extensive conversations over the last year with Senator 
Domenici, we had agreed that we just had to seek a budget this 
year that allowed discretionary spending once again to be able 
to rise at least to a modest extent, rather than consistently 
to be cut.
    But it is not realistic to expect a closely divided 
partisan Congress to take on entitlement programs that the 
President won't take on or to go through the exercise it went 
through 2 years ago, and I deeply fear that that means that the 
allocation that Senator Byrd and I will eventually get for this 
subcommittee will not be at the level that the President 
recommended. I would like very much for it to be so. I might 
have some different priorities within it, but I would like very 
much for it to be so.
    And again, as I told you privately and can now say 
publicly, I'm not today going to ask you to set priorities or 
state what you would cut first. That would be an unwarranted 
imposition on you.
    You're a member of the Cabinet, you're going to support the 
President's budget, but as we work forward, assuming that we 
are going to have to make significant reductions, I want to 
make them in the least harmful way that I can. I hope that we 
will be able to have your constructive suggestions as we go 
forward and that in your own mind, at least, you're going to 
set a number of priorities that will help us with this very 
difficult set of questions.
    Secretary Pena. Mr. Chairman, if I could just briefly 
respond. Absolutely I will work in a very constructive way with 
you and members of the subcommittee to prioritize what we need 
to get done in the Department.
    Having gone through, I think, four of these already in the 
last several years, I'm accustomed to the give-and-take of the 
budget process, but I've always tried to have a very 
constructive relationship with the important committees that 
must make these very difficult decisions.
    So you have my commitment, Mr. Chairman, that we'll do that 
in a very honest and constructive way and tell you what our 
bottom line is and what our priorities are, and we understand 
that in any budget discussion there are going to be 
adjustments, and we're happy to work with you on that.

                        electricity deregulation

    Senator Gorton. Another of my responsibilities, and now 
that Senator Dorgan is here, his as well, in the energy 
authorizing committee is the debate over competition and the 
form of deregulation in the electric power industry. That isn't 
our responsibility, of course, but in your research and 
development budget there are a number of programs that relate 
to power.
    Have you had an opportunity yet or does your budget in any 
way reflect any dramatic changes in the way in which electric 
power is both produced and distributed in the United States? 
And if not, will that be a priority of yours?
    Should we follow the same sorts of programs and priorities 
that we followed in the last several years if, in fact, we're 
going to see a rather dramatic change in the structure of the 
industry?
    Secretary Pena. Mr. Chairman, if I understand your 
question, it is this: We are already observing significant 
reductions in our private sector partners' budgets in research 
and development generally. We have seen that in the overall 
deregulation of key industries in our country, and we are very 
troubled by that.
    With respect to electric restructuring or deregulation, we 
would anticipate the same. That is to say, that if we move 
toward a deregulated environment, the kind of pressure that 
will be put on these now very fierce competitors who will be 
competing in a way that they have not been competing before 
will mean that they will make significant efforts to reduce 
their costs, to be more competitive, and the programs that are 
likely to go first are their research and development budgets.
    Having said that and recognizing the kinds of challenges we 
talked about earlier about trying to develop an energy 
independent strategy for our country, recognizing we've got to 
deal both with the consumption and the production side, it is 
my view that we are going to have to make sure that from the 
Federal side we have the kinds of investments in research and 
development to ensure that as a nation and as a matter of 
public policy we continue to make these kinds of investments 
despite the reduction from the private sector side that we'll 
see with competition, to make sure that we're continuing to 
think about the future and to develop those kinds of 
technologies that are critical to our ability to reduce 
consumption and to find more production.
    So it's a concern of ours. We're aware of it. We haven't 
yet quantified it because we're not in that deregulated 
environment, but as we move through this year and all the bills 
that will be introduced to look toward deregulation, obviously 
that will be one aspect or byproduct of deregulation that we'll 
follow very carefully.

         fossil energy research and development accomplishments

    Senator Gorton. Can you tell us what we've gotten from our 
investment in, say, fossil energy research and development over 
the last 4 or 5 years; what tangible results this society has 
obtained?
    Secretary Pena. Mr. Chairman, I can. In fact, I have asked 
my associates at DOE to compile a list, and we would be happy 
to get that to you to give you a comprehensive view, but let me 
just give you a couple of examples, and I asked my associates 
to give me things that we could relate to.
    [The information follows:]
 Examples of DOE/Office of Fossil Energy Accomplishments for Programs 
              Funded Under Interior Appropriations Account
    Built Strategic Petroleum Reserve, world's largest emergency 
petroleum storage reserve, designed to drawdown inventory of 563 
million barrels of crude oil at sustainable rate of 3.9 million barrels 
per day within 15 days of direction from President. Ongoing 
accomplishments will extend SPR facility and systems capability to 2025 
with highest level of reliability and operating cost efficiency.
    Operated, maintained, and produced Naval Petroleum and Oil Shale 
Reserves (NPOSR) to achieve greatest value and benefit to United 
States. Since Reserve opened to full development in 1976, program 
through fiscal year 1996 has generated $16.5 billion in revenues 
against cost of $3.4 billion.
    Supported Development and testing of powerplant technologies that 
have already had major economic and environmental impacts, and will 
form the foundation for future benefits. Technologies include:
  --Low-polluting atmospheric fluidized bed coal combustor, the most 
        significant advance in coal-fired boiler technology in more 
        than half a century. Federal investment has contributed to more 
        than $6 billion in domestic sales, $2 billion in foreign sales, 
        and more than 250,000 jobs.
  --Low nitrogen oxide (Nox) burners, which significantly 
        lower costs of reducing Nox compared to other 
        options. Domestic sales to date total more than $250 million, 
        supporting 1800 U.S. jobs.
  --Integrated gasification combined cycle technology, and advanced 
        coal-fired power generation system that will be one of the most 
        important powerplant options of the 21st century. The potential 
        global market (undiscounted) for this technology is estimated 
        at more than $400 billion in capital investment by 2030, and 
        about $150 billion in domestic market.
    Supported development and testing of technologies and use of other 
approaches, resulting in increased domestic production of natural gas 
and oil through major improvement in recovery costs. Examples of 
technologies and approaches include:
  --Mudpulse telemetry, which is one of the most important innovations 
        used today and allows measurement while drilling. Savings are 
        estimated at $5 billion.
  --Insulating doughnut for steam flood in deeper oil wells, which 
        reduces heat loss in the wellbore and will save industry 
        hundreds of millions of dollars over the next decade.
  --Hot oiling paraffin treatment that reduces paraffin buildup in 
        wellbores which cause lifting equipment failures, reducing 
        industry operating costs by more than $150 million per year.
  --Assistance to states in implementing risk-based management 
        approaches in effectively regulating oil and gas injection 
        wells. Streamlining savings to domestic gas and oil exploration 
        and production industry are estimated at $1 billion through 
        2020.
       office of energy efficiency and renewable energy--recent 
                            accomplishments
    The Clinton Administration has launched a series of initiatives in 
energy efficiency and renewable energy research, development and 
deployment that are moving our nation toward a future with improved 
environmental quality, greater energy security and increased global 
competitiveness. By the year 2000, these Clinton initiatives are 
estimated to save consumers and businesses over $10 billion in annual 
energy savings and cut annual carbon emissions by 25 million metric 
tons of carbon equivalent. By 2010, these savings are projected to rise 
to $50 billion per year, 500 million barrels of oil per year, and 80 
metric tons of carbon equivalent. Specific recent accomplishments 
include:
  --Implementing the Climate Change Action Plan which, by the year 
        2,000, will reduce carbon emissions by 15 metric tons of carbon 
        equivalent.
  --Initiated 16 Climate Change programs that have attracted over 2,000 
        voluntary business, industry and government partners.
  --Signed more than 100 climate challenge agreements for emissions 
        reductions with more than 600 utilities.
  --Established 52 new state and local building retrofit programs, 
        leveraging more than $200 million of private sector investment.
  --Established eighteen Motor Challenge showcase agreements to 
        optimize electric system efficiencies resulting in more than 
        1,000 partners and an investment of $15 million, exceeding 
        goals by 700 partners and $5 million.
  --Leading the industry and government design and research for an 80 
        mile per gallon car for the future. Technologies already in the 
        fleet are saving nearly 1 billion gallons of gasoline a year. 
        Signed contracts for developing hybrid vehicles with the three 
        major car companies and their suppliers. In fiscal year 1997 we 
        will demonstrate a ``no-compromise'' 50 mpg proof-of-concept 
        family sedan, maintaining or improving vehicle cost, safety, 
        comfort, and performance factors.
  --Displacing nearly 10 million gallons of gasoline annually through 
        the more than 30,000 alternative fuel vehicles introduced to 
        Federal and local fleets in 55 Clean Cities.
  --Transferring proven energy efficiency and renewable measures such 
        as technologies used in ``Greening of the White House'' to all 
        Federal buildings to support reduction of federal energy 
        consumption by 30 percent by 2005 compared to the 1985 
        baseline.
  --Initiated Federal Greening Models such as the White House, the 
        Pentagon, the Presidio in San Francisco, and the DOE Forrestal 
        Building.
  --Developed 6 major private sector/government energy service 
        contracts, attracting millions in private sector investments to 
        Federal energy projects, building a new business sector and 
        saving federal dollars.
  --Weatherized over 300,000 low-income homes (employing 8-10,000 
        people) and upgraded more than 1,000 schools and hospitals 
        annually.
  --Developing partnerships with energy-intensive industries such as 
        refining, pulp and paper and metals, to develop research 
        programs, strategies and technologies that will lead to 
        dramatically improved energy and resource efficiency and 
        competitiveness by the year 2000, and energy cost savings of 
        $10 billion by 2010. Signed Visions agreements with five of the 
        seven industries and expect to complete Chemical and Refinery 
        Visions before the year is out. Eleven related technology and 
        research roadmaps are underway.
  --Developed an Industry Vision and Technology Roadmap for the future 
        in partnership with the Pulp and Paper industry that they 
        estimate will save them $8 billion in environmental control 
        costs.

                           electronic ballast

    Secretary Pena. One was work that we did in the electronic 
ballast, which is the ballast that goes into the fluorescent 
lighting. That one technology success has produced $3.7 billion 
in energy savings. The work that was done on refrigerator 
compressors has produced $6 billion in savings.
    Senator Gorton. In each of those cases, what was the 
public-private split on the cost of the research?
    Secretary Pena. I would have to get that information for 
you, Mr. Chairman. We can break that down. Some of these have 
different variations. But I've got five before me here--
advanced windows, flame retention heat oil burner, building 
design software. If you add all those up we estimate we saved 
consumer energy costs about $28 billion, and that's just a 
flavor.
    [The information follows:]

                  Energy Conservation Accomplishments

    The Department's investment in buildings efficiency R&D 
over nearly two decades has yielded a number of highly 
successful energy conservation technologies. Five technologies 
in particular are estimated to have saved consumers over $28 
billion--savings that continue to accrue at a rate of more than 
$5 billion each year. These five technologies are: building 
design software; efficient refrigerator compressors; electronic 
fluorescent ballasts; flame retention heat oil burner; and 
advanced (Low-e) windows. The total public investment in these 
five technologies was $45 million and the total direct private 
cost share amounted to over $27 million. The cost share for 
building software design was 19 percent; for efficient 
refrigerator compressors 12 percent; for electronic fluorescent 
ballasts 50 percent; and for advanced (Low-E) windows 68 
percent. There was no private sector funding for the 
development of the flame retention head oil burner, which has 
saved consumers an estimated $5 billion.

                        new fuel cell technology

    Secretary Pena. I haven't even talked about the much more 
aggressive things we're doing in the Partnership for a New 
Generation Vehicle Program, where already just a few months 
ago, even though that work is far from complete, we saw 
Chrysler announce a new fuel cell technology which is cutting 
edge, that no one thought would be able to be announced so 
early in this 10-year research program.
    So we believe that there are demonstrable savings that we 
have been able to demonstrate with the technology investments 
we have made in the past, and what I want to do, as I said 
earlier, is develop a much more strategic direction on this 
question of how we can become energy independent by looking at 
both the consumption side and the production side and asking 
the question of all these dollars we're investing in technology 
what is the product, what are the gains we'll see, what are the 
reductions in energy use we can measure, what are the savings 
to consumers that will result from these kinds of investments.
    And I'll be working very hard to develop that much more 
strategic focus because I share what I believe to be your 
concern, and that is we've got to show product. We have to show 
progress. We have to demonstrate that there is some significant 
improvement in the result of these very significant investments 
which I think are worthwhile, and I will work very hard on that 
issue.

                          repayment provisions

    Senator Gorton. The first cousin to that question is, some 
of your programs have a recapture or repayment provision that 
when research and development is commercialized you get some of 
the money back. How have they worked? Should they be broader? 
Have they worked? Have we actually recaptured any money through 
them?
    Secretary Pena. Mr. Chairman, we have. In the Clean Coal 
Technology Program, for example, which GAO has cited as a model 
public-private partnership venture, there were provisions in 
the early days in the investments we were making there for 
recapture, and we have received, I think, $400,000 or so thus 
far, and that's only in the early stages.
    So we think that by being very strategic in where we will 
require these kinds of recapture provisions, we can begin to 
get a repayment.
    Now, we have to be very thoughtful about it and not impose 
such stringent requirements that our private sector partners 
will back off. But I think there will be occasion, and clean 
coal is one where it's working, where I think that will make a 
lot of sense.

                          codes and standards

    Senator Gorton. One more set, then I am going to defer. One 
of the really controversial areas that we had to deal with in 
my first 2 years as chairman had to deal with codes and 
standards; 2 years ago we actually were frustrated in letting 
the Department go ahead with them. Last year I think we did.
    Where are you on lighting and appliance standards? Is the 
cooperation in the private sector sufficient now so that 
they're no longer going to resist? Where are we there? I find 
this to be an extremely important area. I would like to 
continue it, but, again, are we making some real progress and 
is it a cooperative progress?
    Secretary Pena. Mr. Chairman, I've been advised that 1 year 
or so ago the Department made extraordinary efforts to develop 
a much more cooperative working relationship with, in 
particular, the large manufacturing companies that are the 
subject of these standards and that a new relationship has been 
established. I think that was tested a year or so ago on the 
new refrigerator standard, which is still in discussion at the 
moment.
    I want to say that I have had some experience with this new 
approach in what we call the negotiated rulemaking process, and 
I would hope that we could establish a constructive 
relationship with the private sector to agree on a public 
policy objective, a public policy goal, and then find a way to 
get there if at all possible in a mutually reinforcing and 
positive manner. I think that is a far more constructive way of 
dealing with these issues.
    The President has asked us to be more creative in doing 
these rulemakings contrasted to the old process of simply 
publishing a rulemaking, having comments come in, and then 
finally issuing a final rule which may or may not be the 
appropriate thing to do.
    So we want to work on this, obviously keeping in mind the 
important public policy objectives, but I think there is room 
for a very constructive relationship that we can establish with 
the private sector.
    Senator Gorton. At this point, Senator Dorgan is a new 
member of the committee, of the subcommittee, and a welcome 
one. I have a bunch of questions, Senator Dorgan. I want to 
give you an opportunity either to make a statement or to ask 
your questions now, and then stay as long as you want. I think 
it was just before you came in that I passed out these charts 
that I hope will help you understand the relationship between 
or among all of the various programs. I know it has been very 
helpful to me.

                       remarks of senator dorgan

    Senator Dorgan. Mr. Chairman, I have a Commerce Committee 
hearing going on. That is why I was delayed, and I have to go 
back as well, but I appreciate being here. I am going to enjoy 
being a part of this subcommittee, and I appreciate having the 
opportunity to visit with the Secretary at this hearing.
    You showed me this chart last year, and I found it 
enormously interesting and helpful. This is the only chart of 
its kind that I have seen that actually describes in bar graph 
form exactly what we are spending and how we are spending it. I 
think it is very useful.
    I would just like to say that I'm a newcomer to this 
subcommittee and a newcomer to the issue of priorities in these 
areas, but I really think that the fossil fuels research area 
is one account that we would want to beef up, not reduce, given 
the challenges we face and given the circumstances that exist 
in our country.
    We have in North Dakota an example of a wonderful facility, 
the Energy and Environmental Research Center at the University 
of North Dakota, which I think is almost the model in the 
country of the partnership in public sector-private sector 
research, and I'll be visiting with the subcommittee about 
that.
    I hope as we work through this and establish our priorities 
here in Congress that we will find a way to enhance rather than 
retreat on the issue of fossil fuels research. I know that 
we're faced with enormous challenges in every part of the 
budget. There isn't any question about that. But this is an 
area that truly is a critically important investment, and so I 
would hope that it would be the priority.
    Again, I missed the presentation by the Secretary. I wish 
the Secretary well in this new job and I look forward to 
working with him very much on a wide range of issues.

                           prepared statement

    Mr. Chairman, thank you very much for this instructive 
chart as we move ahead.
    Let me just ask unanimous consent to have my statement 
inserted into the record.
    Senator Gorton. Without objection.
    [The statement follows:]

                  Prepared Statement of Senator Dorgan

    Mr. Chairman, Senator Byrd and other members of the 
Subcommittee. Since this is my first hearing as a member of the 
Interior Appropriations Subcommittee, I want all of you to know 
that I am very pleased with this assignment and I look forward 
to working with all of you in the days and months ahead.
    As I familiarize myself with the many agencies and programs 
funded in the Interior appropriations bill, I have able mentors 
in the Chairman and ranking member. I would like to note that 
many of the funding decisions made by this subcommittee will 
have a direct impact on the health and economic welfare of the 
people of North Dakota, and I look forward to working with you 
on a host of crucial issues affecting my State as the 
appropriations process proceeds.
    I would also like to welcome Secretary Pena to his first 
subcommittee hearing as Secretary of Energy and to congratulate 
him on his confirmation by a vote of 99-1 just yesterday. I 
look forward to working with you, Mr. Secretary, as you assume 
your new responsibilities as the head of the Department of 
Energy and I wish you well as you take over your new 
responsibilities.
    I would like to take a minute to make a few general 
comments on the proposed fiscal year 1998 funding levels for 
the Department for Interior before I address the items to be 
covered in today's hearing. While I am pleased that the total 
budget request of $7.5 billion for the Department of the 
Interior represents an increase of $462 million over last 
year's enacted level, it is still less than the 1994 level. 
Like most agencies, the Department of the Interior has had to 
learn to live with downsizing. While we all support the concept 
of streamlining--of doing more with less--we must make certain 
that we are not sacrificing long term policy interests for 
short term budgetary goals.
    There are many high priority programs funded by the 
Department of Interior ranging from our national parks to 
wildlife refuges to our cultural institutions, all of which, in 
my view, deserve continued government support. I know hard 
choices have to be made in this era of shrinking federal 
resources, but those decisions are particularly difficult in a 
bill which funds so many meritorious programs.
    Before I leave the topic of the Interior budget in general, 
I want to advise the subcommittee of one area of real and deep 
personal concern to me, namely, a woefully underfunded budget 
for Native Americans. The ever shrinking resources allocated to 
Native Americans are, in my view, a national tragedy and a 
national disgrace, and I will address this matter in more 
detail at the April hearing.
    Fossil energy research and development within the 
Department of Energy, which is funded in the Interior 
appropriations bill, is the topic of today's hearing. This is 
an extremely important issue for the people of North Dakota and 
the nation. Since 85 percent of our national energy fuel 
consumption currently comes from fossil fuels and will remain 
our primary energy source far into the future, it is in all our 
best interests to ensure that fossil fuels energy is both 
efficient and environmentally safe. It seems strange to me, 
therefore, that the Department of Energy's Fossil Energy 
Research and Development Program funded in the Interior 
Appropriations bill is slated for a significant reduction in 
fiscal year 1998, from $365.8 million to $346.4 million.
    I realize that I am a newcomer to this subcommittee, but I 
would think that fossil fuels research is one account we would 
want to beef up, not reduce. I know Senator Byrd has a 
longstanding interest in this matter, but I want the 
subcommittee to know that North Dakota also produces a 
significant amount of coal so this program is of great interest 
to me as well.
    On a happier note, I would like to take just a few minutes 
of the Committee's time to talk about the outstanding fossil 
fuel and energy research that is being conducted by the Energy 
and Environmental Research Center (EERC) at the University of 
North Dakota under DOE's Cooperative Research and Development 
program. We in North Dakota are extremely proud of the high-
quality work being produced by the EERC, and I am pleased that 
the President has recognized the EERC's contribution to the 
research and development of clean and efficient energy 
technologies by requesting $1.96 million for EERC under the 
Jointly Sponsored Research Program (JSRP). The JSRP combines 
DOE and private sector support for commercialization of 
advanced technologies. Commercialization of cutting edge 
technologies is the key to our energy security, improved 
efficiency and environmental health and safety, and this 
partnership between government and industry is crucial if we 
are to be successful.
    This JSRP program is complemented by a basic research 
component devoted to research on innovative concepts which have 
commercial potential as well as scientific and engineering 
fundamentals targeted to overcoming commercialization barriers. 
Unfortunately, the Department's budget request did not include 
funding for this basic research component.
    I am pleased, however, to see that the Department's request 
included $1.86 million for cost-shared coal related research 
that is approved by DOE and is consistent with the Fossil 
Energy mission. I am somewhat concerned and puzzled as to why 
this research program does not include oil and gas research, 
given both the EERC's programmatic expertise in these areas as 
well as the fact that Fossil Energy's mission includes oil, 
coal and gas.
    The EERC is a leading U.S. Center for Excellence in coal, 
oil, and gas technologies, placing particular emphasis on low-
rank coals found in the western United States, Alaska, Central 
Europe, Australia, Russia, China, and Indonesia. Low-rank coals 
represent approximately half of the coal reserves in the lower 
48 States, with much larger potential reserves in Alaska. The 
EERC is uniquely designed to combine cutting-edge basic and 
applied research with market forces to advance the goal of 
supplying clean and secure energy to sustain a high standard of 
living in an unpolluted environment and in increasingly 
competitive marketplace.
    The technologies that are being successfully developed by 
the EERC would simply not be possible without some government 
assistance. Government support plays a vital role in the 
initial stages of research and development by fostering basic 
research that is not immediately rewarded in the marketplace. 
But government must have partners if the basic research is 
going to move forward to development, demonstration and 
ultimately to commercialization. That is the beauty of the DOE 
Cooperative agreement. After the basic research identifies 
promising new technologies, DOE works with industry to resolve 
the intractable barriers to full commercialization of 
technologies that will lead to more efficient and 
environmentally safe fossil fuel energy. Government doesn't 
pick the winners, the marketplace does.
    I am attaching to this statement some examples of projects 
developed by the EERC through both the basic and jointly 
sponsored research components of the DOE Cooperative Agreement 
which I hope the subcommittee will find of interest. I hope 
these examples will convince the subcommittee of the 
exceptional work being performed by the EERC and that the 
subcommittee will fully fund the Administration's fiscal year 
1998 request for EERC of $3.8 million.
    I have a number of questions which I have not been able to 
ask today and I would request that they be submitted for the 
record.
    Again, I want to thank the Chairman and Ranking Member for 
their patience.
                                ------                                


  Examples of EERC Projects Funded Under the DOE Cooperative Agreement

                             basic research

    Combustion 2000: A high performance power system is being 
developed and demonstrated by the EERC in partnership with 
industry and the DOE which will provide a strong leap forward 
in the performance of coal-fired powerplants. The EERC has 
teamed up with United Technologies in developing technology for 
indirect firing of coal in a gas turbine combined-cycle system, 
with construction nearing completion on a pilot slagging 
combustor and high-temperature alloy heat exchanger at the 
EERC. This system will increase thermal efficiency from 33 
percent to 47 percent while reducing emissions by 90 percent as 
well as reducing the costs of electricity. If this system were 
to replace existing systems, it would reduce by one-fourth the 
current carbon dioxide emissions from coal-fired utility 
boilers.
    Trace Element Emissions: Trace elements plug hot-gas 
filters, poison fuel cells, and pollute the environment. This 
EERC project provides an understanding, for the first time, of 
the release, transformation, emission and capture of trace 
elements in advanced coal gasification systems. Results have 
been incorporated in a computer code that is being used by 
industry to understand and predict the fate of trace elements 
in gasification systems and to optimize operating conditions 
and the design of hot-gas filtering systems to minimize 
plugging, improve reliability and efficiency, and lower 
emissions.

                       jointly sponsored research

    Advanced Gasification and Hot-Gas Cleanup: The EERC is 
currently playing a key role in demonstrating an advanced 
fossil fuel gasification and hot-gas cleanup technology based 
on the M.W. Kellogg transport reactor, a sophisticated high-
velocity circulating gasifier. Once commercialized, this 
combined-cycle technology will substantially decrease the 
emission of sulfur, particulate, and nitrogen species and, by 
improving efficiency, reduce the release of carbon dioxide 
which contributes to global warming. This program involves a 
large number of domestic and foreign participants.
    Coal Ash Behavior in Reducing Environments: Ash and slag 
have severe impacts on the performance and reliability of 
advanced coal gasifiers as well as environmental control 
systems. This two-phased program, also supported by a large 
number of foreign and domestic energy companies, is developing 
methods to improve gasifier design and operating procedures and 
to minimize emissions. It has received significant 
international attention because of its contribution to 
improving advanced gasification systems that are being exported 
outside of the United States.
    Freeze-Thaw/Evaporation Process to Treat Oil and Gas 
Produced Waters: Eighty percent of the waste resulting from the 
production of oil and gas in the United States is saline water. 
A demonstration project jointly conducted by the EERC and B.C. 
Technologies (BCT) has demonstrated the economic advantage of 
coupling a natural freeze crystallization process with 
evaporation to reduce dramatically the volume of saline 
wastewaters and produce water for beneficial use. This process 
has been successfully demonstrated by the EERC and BCT over the 
past 2 years with the Amoco Production Company and the Gas 
Research Institute at a commercial Amoco Production Company 
coalbed methane facility in New Mexico. This process has the 
potential to increase domestic oil and gas production by 
extending the economic life of marginal wells and opening new 
reserves in areas where high volumes of produced water have 
prevented economic production. It also has the potential to 
help meet a global need for the desalinization of water to meet 
the demands of an ever expanding population base.
    The Alaska Initiative: This initiative, managed by the EERC 
for DOE's Federal Energy Technology Center (FETC), provides a 
working affiliation under which DOE and Alaskan partners are 
demonstrating new technologies to meet the current and future 
needs of Alaska in an environmentally acceptable way. This 
activity has two distinct focuses: (1) the relocation of an 
existing Clean Coal Technology demonstration project, and (2) 
demonstration of remote-site power technologies. A number of 
milestones have already been achieved.
    Clean Coal Demonstration: This project has already been 
relocated from Easton, Maryland to Fairbanks, Alaska. The 
partnership is currently working to finalize the nonfederal 
funding that must be in place by July 1997. Successful 
completion of this demonstration activity will meet the 
University of Alaska (Fairbanks) need for additional energy 
using indigenous fuels, reduce dependence on diesel fuel, 
create a new research focus at the University, create export 
potential for Alaskan coal resources, and create a showcase 
project with international appeal. This coal-water fuel 
technology under demonstration was developed under Cooperative 
Agreement.
    Remote-Site Power Generation: The use of indigenous 
resources in remote areas for power generation offers a 
worldwide opportunity. The feasibility of applying fluidized-
bed combustion technology to meet the power needs of the 
village of McGrath, Alaska, using indigenous fuels will be 
determined by April 1997. The EERC is coordinating the 
assessment evaluating local fuel resources, including coal, 
municipal solid waste, and biomass (wood), as a replacement for 
the fuel oil currently used for electrical generation and 
heating in this village. This showcase project, if successful, 
will lead to commercializing this remote-site power generation 
technology worldwide.
    An assessment is also underway to evaluate the feasibility 
of a demonstration project in interior Alaska to use coalbed 
methane in a fuel cell to provide electricity for remote 
villages. EERC's project currently underway in New Mexico is 
proving coalbed methane produced waters can be cleaned in a 
cost effective manner. Successful completion of this 
demonstration will result in superclean and efficient 
electricity production using local resources and creating local 
jobs.

                    clean coal technology rescission

    Senator Gorton. Senator Byrd, since I wasn't here on time, 
did you ask about and get sufficient answers to questions on 
clean coal technology and rescissions?
    Senator Byrd. Mr. Chairman, I asked some questions, but I 
indicated that I had a good many additional ones that I would 
just submit for the record, and so I do not propose to ask any 
more questions now. I just want to thank you for your being so 
courteous, as always.
    Mr. Secretary, let me add before I leave, I was chairman of 
this subcommittee for several years, and Senator Gorton has 
mastered the details of it in 2 years. As a matter of fact, he 
mastered the details in the first year far more than I had ever 
been able to accomplish, and he's been a very energetic and I 
would say accomplished and competent chairman and as far as I 
have been able to determine in my membership here, he is just 
what--you get just what you see. He is right upfront and frank, 
and I am glad to have him as my chairman of this subcommittee.
    If we have to have a chairman of the other party, I will 
buy this one any day and anywhere. I close by saying I know you 
are going to have a good relationship with our chairman and our 
committee, and this bright new member over here, Senator 
Dorgan, he is one of the shining new stars in our Senate.
    I am not just passing out compliments today, but I have 
long ago come to the conclusion if you have got some good 
things to say, do not hesitate to say them about people, and 
say them right upfront, and if you cannot say good things, why, 
do not say anything until you have to, and then say it loud and 
clear.

                   federal energy management program

    Senator Gorton. That is great advice. I thank you very 
kindly, Senator Byrd. I hope I can live up both to that 
reputation and to your advice about how to deal with other 
people.
    Again, Mr. Secretary, a few more questions before we submit 
a significant number to you in writing. Cooperation and support 
that you are getting from other agencies on energy management, 
can you comment on that? Are there some that are doing well and 
some that are doing poorly and how do you set your priorities 
when you have to deal with your equals in other agencies and 
attempt to persuade them to help you with your mission?
    Secretary Pena. Mr. Chairman, I believe that the other 
department heads know that this is an important matter, and the 
President has made it a priority. I look forward now that I 
have the primary responsibility among the other Cabinet members 
in encouraging them to also act and take more appropriate steps 
here to work with them to be much more aggressive and more 
thoughtful about how all of the departments can focus on energy 
efficiency, so that's something I think we can do. We've made 
some improvements already, but I think there's much more that 
can be done.
    As I begin to elevate the discussion within the 
administration on this priority of developing an energy 
independent strategy, which I have talked to the President 
about, I believe that that particular issue you've raised will 
take on a bigger importance because, after all, the Federal 
Government is one of the biggest users of energy in our 
country, among the various players who use energy, and so we 
have a responsibility to lead if we're going to work with the 
private sector and others to encourage them to take some steps.

                      epa standard on particulates

    Senator Gorton. Another subject in which I am sure Senator 
Byrd will be interested in as well--the new proposed 
Environmental Protection Agency standards on particulate 
matter, coupled with what seems to be a less than robust 
support for research and development on some of the very 
technologies that may be essential if we are ever to impose 
such standards. Do you think that the two are realistically 
related to one another?
    Do you have any degree of confidence that we are going to 
have advanced our technology sufficiently to meet these 
standards, if they are actually imposed, without tremendous 
economic dislocations?
    Secretary Pena. Mr. Chairman, I can't answer that question 
today. I can't answer it yet. Obviously, in the months to come 
all of the departments will be engaged in an administrationwide 
effort looking at these new proposals, and the question you 
have raised is obviously one that we're going to put on the 
front burner.
    So hopefully in the next several months I'll be able to 
answer your question much more specifically. But obviously 
there are concerns about whether or not we're going to have 
enough investment in those technologies that will help us meet 
those goals, and that is something that, since I am new to the 
Department, I will need to focus on very, very quickly.
    Senator Gorton. That is going to be really important. We 
have how long, do you remember, Senator Byrd, to determine 
whether or not we would approve or disapprove of those 
regulations? Aren't they due out in June?
    Senator Byrd. I do not recall.
    Senator Gorton. When is that?
    Secretary Pena. I believe you're correct, Mr. Chairman. I 
think the final rules would come out some time in June, at 
least under the current schedule.
    Senator Gorton. Well, any help you can give us in your 
predictions as to whether or not the society is realistically 
going to be able to meet them, and what contribution our 
research and development will make to being able to meet them, 
I think is going to be very important because I strongly 
suspect we are going to be debating that issue here in 
Congress, don't you?
    Senator Byrd. Yes; I bet we will.

                         arthur d. little study

    Senator Gorton. Some time ago Arthur D. Little performed an 
analysis of the Department's quality metrics. It seemed to show 
an overestimation of some of the programs that were funded in 
this bill. Do you have a response to that study and, if so, is 
that response in any way reflected in this budget request?
    Secretary Pena. Mr. Chairman, I have not had a chance to 
review that Arthur D. Little study, but Dr. Romm would like to 
make a comment on that, with your permission.
    Senator Gorton. Fine. Yes.
    Mr. Romm. Yes; there's been some confusion in the press. 
That study was actually commissioned by the Department of 
Energy, it was commissioned by my program, in particular, as a 
peer review for our estimates of what the benefits of our 
programs would be so that we could present the most accurate 
estimates to Congress as possible.
    The fiscal 1998 budget request that you have in front of 
you reflects all of those peer reviewed analyses, and Arthur D. 
Little wrote a letter, in particular, praising the Department 
for pursuing an independent peer review of its benefit claims, 
and at every point in time we have attempted to present as 
accurate information as possible about the energy and 
environmental benefits of our programs.

              partnership for a new generation of vehicles

    Senator Gorton. Another subject, and I am going to ask this 
in general terms, as Bruce Evans has written a number of 
specific questions which you can deal with in writing. I have 
become increasingly interested, and I think obviously the 
country is becoming increasingly interested in the research and 
development of alternative engines for automobiles--
electricity--I cannot remember the proper name, but the 
flywheel technology and different forms of diesel and the like.
    Could you give me an overview of that research and 
development and perhaps say where you think we might be fairly 
close to a breakthrough, and what the future in the next half 
dozen years looks like given the contribution of your funded 
research and development? Any of the technologies seem to you 
particularly significant?
    Secretary Pena. Mr. Chairman, I would be happy to. Probably 
the area where we believe we will see the most significant 
advancement is in the Partnership for a New Generation Vehicle 
Program that we started a couple years ago.
    While it had, I must say, a somewhat rocky start, I would 
say that today the program is working quite well. The 
Department of Commerce is the overall lead of that program, but 
the Department of Energy is the technical leader of that 
program. Our goal is to produce a new car that is three times 
more efficient than cars today, that perhaps can do 80 miles 
per gallon in terms of efficiency by about 2002.
    Mr. Romm. 2004.
    Secretary Pena. 2004. Thus far what is very positive about 
this relationship.
    Senator Gorton. 2002 just seems to be a magic year. It 
seems to just sort of drop off my lips every time whether it is 
relevant or not.
    Secretary Pena. It's supposed to be, I think, a 10-year 
program, but we're already beginning to see some products. 
Chrysler very recently announced a new fuel cell that was a 
byproduct of the work we were doing jointly with the 
partnership. This is a fuel cell that will be able to take 
ethylene, ethanol, methanol, almost any fuel and have a fuel 
cell that operates in an effective fashion, and they rolled out 
that new technology.
    So we believe there is great promise here. It is, I think, 
so likely that 2 years ago when I participated in the European 
ministers conference where I represented the Department of 
Transportation from the United States, our counterparts in 
Europe were so fascinated about the relationship we had 
established here that they are now doing the same thing, and 
establishing a partnership with their automakers to see if they 
can also produce a new car of the next century.
    I think this is the area where we will see the greatest 
promise and thus far I think all the parties to this have 
worked very well. We're matching our investments one to one. We 
are basically on target. Mary Good, as you know, is the overall 
coordinator of this, but our Department is there working hard 
to make sure we're meeting our milestones.
    So that is one example of where Government and the private 
sector can work together for a public good, for an enormously 
important objective given the tremendous use that 
transportation plays in terms of consumption of oil, about 70 
percent from transportation.
    So we know that on this issue of energy independence, 
unless we tackle and address the transportation part of this, 
it will be very difficult for us to make substantial gains in 
the next century. So I think that's one example of a program 
that's working well.
    Senator Gorton. Is there any implication in your answer 
that we are spreading our efforts across too many alternative 
technologies and too thinly, and that we should concentrate on 
one? Or are we still at an early enough stage that we ought to 
be going down a number of alleys, hoping that at least one of 
them is not a dead end?
    Secretary Pena. Mr. Chairman, at least on this program, and 
that is the development of a new car, a new engine, as you 
describe it, this is the focus, and we are all concentrating 
our resources and our time and our energy on it, and again, 
this is a very significant public-private relationship, one 
that is unique in the world.
    I think that given the growing confidence that we have 
established among the parties, some of the early milestones and 
some of the byproducts that are developed already, that both 
industry and the Government are developing even a higher degree 
of confidence in the work that we're doing.
    It's difficult. There's no question about that. But I think 
so long as we continue to be partners by bringing the Federal 
commitment to the table, the private sector will do the same, 
and I think we may surprise a lot of people when we can produce 
that new car in the next century.

                home energy rating system pilot program

    Senator Gorton. You will certainly please a lot of people 
if you succeed in doing that.
    One small request that you have in your budget here, the 
home energy rating system pilot program in seven States. How 
long have the pilots gone on? How long will the pilots continue 
to go on? Are we getting anything out of it?
    Secretary Pena. If this is, Mr. Chairman, the program where 
we're going to rate homes, there are a number of States beyond 
the seven that already have State programs. I think it's 20 or 
so. So from our perspective, we are continuing to work on this 
program to determine if we should have a national effort here 
in rating the efficiency of homes, if that's the subject matter 
you're asking about. Let me have Dr. Romm amplify that
    Mr. Romm. If you're speaking of the seven pilot States, the 
pilots are scheduled to go for about 2 years, and I think on 
average they have gone on about 1 year, so those pilots would 
be expected to continue for only about 1 more year.
    Senator Gorton. Will there be more pilots after that?
    Mr. Romm. If funding permits, basically.
    Senator Gorton. Just tell me in general terms what you 
think your most important functions are with respect to natural 
resources, mining and the like, your natural gas programs, 
methane programs and coal mines, and the like.
    Secretary Pena. Mr. Chairman, there are a number of 
priorities. For example, slant well drilling has already been 
successful and tested in a number of States where we have been 
able to generate very significant increases in output in wells 
that were essentially inefficient and almost ready to be 
abandoned.
    Our 3-D seismic technology program has been extraordinarily 
successful and now there's a question whether we should move to 
a 4-D seismic technology program. There are a number of 
technologies like that which we think have already been quite 
helpful.
    I think where we want to continue to place emphasis is in 
working very closely with the independent producers. These are 
essentially the small companies, the small operations that are 
only in the production phase. They're not in marketing. They 
are not in other aspects of that, and since they play such an 
important role in production, we think that by working more 
closely with them and sharing that technology, providing 
advice, we can make them even more efficient.
    We are very concerned about the fact that we are losing 
about 16,000 to 17,000 marginal wells a year. That I think is 
not good news, and so that is a very high priority if we can 
find a way to help those small firms be more productive and 
stay in business and continue to produce. So in that area, I 
think that is a very high priority for the Department of 
Energy.

                    arctic national wildlife refuge

    Senator Gorton. The quest for energy independence has not 
caused you to begin to reconsider your position on ANWR, I take 
it?
    Secretary Pena. Mr. Chairman, as you know, the President 
had established a position on ANWR sometime ago, and the 
administration position has not changed.
    Senator Gorton. Let me just ask an open-ended question. We 
have a full series of questions on specific programs here that 
we will submit to you in writing, but what have I omitted? What 
area would you like me to focus on or know something about that 
has not been discussed here this afternoon? Do you have any 
last set of messages that you or any of your staff would like 
to leave with me?
    Secretary Pena. In reviewing, Mr. Chairman, all the 
questions we covered today from fossil energy to energy 
efficiency, we didn't cover the Energy Information 
Administration but that work is superior. Let me turn to my 
colleagues here and ask, are there any other matters that they 
suggest we pursue?
    I think we've covered the high points, Mr. Chairman, so we 
look forward to working with you and to answering the very 
specific questions that the subcommittee members would like to 
submit to us.
    We're very much aware of the budgetary challenges that we 
all face, but let me say that this area of research and 
development, and even though it is a small portion of your 
portfolio here, is critical to our country, and while it may 
not receive the kind of constant support in terms of at least 
vocal expression as you see in other areas, I will make a 
significant effort to elevate the importance of the work we do 
in this area to the country.
    The American people need to understand that we are facing a 
very significant challenge, and this is the time to do 
something about it and not wait until the year 2004 or 2005 
when it might be too late.
    It seems to me that I have the responsibility, given the 
fact that I have the knowledge to help educate the American 
people to help educate other Members of Congress about the 
importance of these kinds of programs. Otherwise we are going 
to have a very significant problem, I believe, in the next 
century if we're not careful and prudent in how we conduct 
ourselves now.
    Senator Gorton. Well, Mr. Secretary, you are a very quick 
study for the first day in office. You get an A for this 
performance.
    Secretary Pena. You're very kind.
    Senator Gorton. I hope we continue to work together 
constructively when the questions get tougher and more 
difficult, as I am afraid they will as this year goes on, but 
thank you very much for your coming and for your 
forthrightness.
    Secretary Pena. Thank you, Mr. Chairman.

                     Additional committee questions

    Senator Gorton. There will be some additional questions 
which will be submitted for your response in the record.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing.]
                     Additional Committee Questions
                    electric industry restructuring
    Question. As a member of the Energy and Natural Resources 
Committee, I spent this morning in another of a series of workshops 
that the Committee is holding on electric industry restructuring. It is 
a highly complex issue about which the Committee, and the Senate as a 
whole, is trying to educate itself. Perhaps you can help us in this 
regard on one aspect of the issue.
    In my tenure as chairman of this subcommittee, I have heard from 
both the Department and from industry that private sector funding for 
energy R&D is becoming more scarce as companies seek to reduce costs in 
order to survive in increasingly competitive and deregulated markets. 
Both the Department and industry have argued that this makes Federal 
R&D support more critical.
    At the same time, uncertainty generated by market restructuring has 
made utilities wary of making major capital investments in new power 
generation, particularly if there are technological risks associated 
with the technology involved. As a result, it seems that several 
technologies developed with DOE support will be slow to be deployed in 
domestic markets.
    I also understand that some states have recognized the relationship 
between deregulation and energy R&D, and have established R&D funds to 
assist in the development and commercialization of innovative, 
``clean'' technologies.
    How do you view the relationship between changes currently taking 
place in the electric industry and the R&D programs funded by this 
subcommittee?
    Answer. The transition to competition in the industry will have 
near-term and long-term impacts on R&D programs. For the near term, 
utilities are already anticipating the transition to competition. Many 
companies are focusing intensively on reducing their costs, including 
research costs, and are making deep cuts, sometimes to survive and 
sometimes to gain market share. In either case, R&D is often seen as a 
non-vital expenditure, except for projects that promise immediate cost 
savings for the company. As a result, corporate commitments to internal 
R&D and to joint efforts with the Electric Power Research Institute 
(EPRI) are declining. Virtually all research sectors have been 
adversely affected, but some have been hit harder than others. R&D 
pertaining to program areas that have historically led to higher 
utility costs, such as energy efficiency and renewable generation, has 
been cut severely, while R&D that could reduce costs in more mainstream 
areas of utility operations has probably been less affected.
    For the long term, we expect that those utility companies that 
survive the transition to competition will eventually feel comfortable 
enough about their future to resume some of their R&D efforts. However, 
we also think that the nature of the R&D utilities support will change. 
Utilities will emphasize R&D on consumer products and marketing, and 
less on basic research and pre-commercial technologies. Today, electric 
utilities cooperate on R&D, but increasingly, companies will be 
reluctant to commit funds to R&D that could benefit a competitor just 
as much as themselves. The industry may rely more on generating 
technology R&D funded by equipment suppliers in the future. R&D related 
to ``public goods,'' such as environmental protection and reliability, 
may be more difficult to support in a competitive industry.
    Question. If Congress acts on deregulation legislation, how can it 
best ensure that U.S. leadership in energy R&D is maintained?
    Answer. One potentially effective way to ensure that U.S. 
leadership is maintained is to include in the legislation a provision 
to establish a reliable and predictable mechanism for funding 
electricity-related R&D.
    Question. Does the Administration intend to address this issue 
directly in the legislation it is developing? If so, how?
    Answer. The Department believes that funding for research and 
development should be addressed in restructuring legislation. One 
option that might be considered would be to establish a federal/state 
system benefit fund that would fund state-level R&D programs, as well 
as other state-level public benefits programs such as universal 
service, conservation programs, and support for renewable technologies. 
The Federal part of the fund might be funded through a charge (capped 
at one mill/kilowatt-hour) on all generation sold into the bulk power 
system. States would be eligible to tap the fund to the extent that 
they raise matching funds.
                          r&d and the economy
    Question. The Executive Summary in the Energy Efficiency portion of 
the budget justification (p. 254) states that ``Since 1992, private 
industry R&D has stagnated. And today, less than one-third of private 
R&D is dedicated to research; the rest is being spent on product and 
process development.'' What is the cause of this ``stagnation'' in your 
view?
    Answer. The stagnation in private industry R&D is caused by several 
factors, including increasing international competition, the structure 
of our financial markets, and, for energy R&D, pending utility sector 
restructuring.
    The increasing globalization of international markets has led to 
increased competition among the many international players. For some 
companies to continue to be competitive in the short-term, they have 
focused on various areas to cut back on their investments, including 
personnel and long-term research and development. Many market 
structures place pressures on publicly traded companies in the U.S., 
including the need to show positive growth each fiscal quarter. Such a 
focus on short-term pay back has a negative effect on longer-term 
investment planning such as utility research and development. In the 
case of energy-related research and development, the uncertainty due to 
the pending industry restructuring and the forecast drop in electricity 
prices has many utilities and energy industry participants also 
searching for ways to restructure themselves to be poised for 
competition. This near term market response has for many companies 
resulted in cutting back on energy R&D. Such cuts recently drew the 
comments of Kurt Yeager, President and CEO of the Electric Power 
Research Institute, who warned ``Do not let short term expenditures * * 
* sacrifice the engine of prosperity [R&D leading to innovation and 
productivity improvement] * * * entitlements cannot be paid if national 
productivity growth does not continue.''
    Question. Is it the Department's view that in the energy sector the 
Federal government must ``make up the difference'' in R&D?
    Answer. Historically, research and development in energy-related 
R&D has worked through a partnership between the energy industry and 
the Department. Public investments helped underwrite the risks of long-
term R&D, and funded activities that helped move technologies which had 
high social returns into the market. The net effect was to stimulate 
private investments that yielded social returns to society, including 
job creation, export growth potential, and cost-effective pollution 
prevention. However, the private investment in research, development 
and deployment has decreased by more than two thirds in the past 15 
years. Restructuring and the uncertainty it creates for the market has 
accelerated this decline. In addition, Federal energy R&D has been cut 
by 75 percent since the late 1970's.
    Our fiscal year 1998 budget request would begin to put us on the 
path toward addressing this decrease on both sides of the public and 
private partnership in R&D by attempting to maintain at a minimum a 
level of Federal investment consistent with that of our international 
competitors, not increase it. The role of the Federal government and 
this investment is critical to ensure continued advances in energy 
efficiency and renewable energy technologies which would decrease our 
dependence on imported oil, increase our competitiveness, improve our 
balance of trade, and improve our national health and environmental 
quality.
    Question. Since about 1992, the economy has been growing at a 
fairly steady rate and the stock market has skyrocketed. How do you 
explain this seeming contradiction between stagnating private sector 
R&D and continuing economic growth?
    Answer. Economic growth occurs for many reasons, including national 
and international fiscal policies, domestic and international market 
condition and socio-political-economic change and disruption. Economic 
growth also tends to be cyclical in nature, with peaks and troughs. 
Much of the growth of today may be attributable to prior investment in 
our national economy, including private and public sector investments. 
In addition, some companies may be currently performing well in the 
market due to the cuts they have made in long-term investments, such as 
personnel and research and development. However, the effect of these 
short-term cuts may not be felt for several years out, even though 
investments made during economic upswings may very well carry the 
companies through economic downturns.
                                examples
    Question. In considering funding for programs that run to the 
hundreds of millions of dollars, I think it is often helpful to have 
some specific examples of how this money is being spent. Would you 
describe for Committee some specific examples of technological advances 
that have been made in the Fossil R&D or Energy Conservation program in 
the last fiscal year?
                      energy conservation examples
    Answer. The Office of Energy Efficiency and Renewable Energy has 
been recognized globally as a leader in applied research and 
development. In this decade alone, the Office has garnered over 40 
major awards for our research, development and deployment. Some 
examples of technological advances developed by our program activities 
with labs and partners that received recognition for this past year 
include:
    The oxygen enriched air staging process which integrates two 
previously competing technologies, simultaneously reducing 
NOx emissions and energy use in the glass making process 
improving process efficiency, energy efficiency and domestic industry 
competitiveness.
    The Benchmarc Catalytic Converter using either electric preheating 
or chemical catalysis to significantly improve cold start combustion 
efficiency and significantly reducing emissions and energy waste during 
cold start in the transportation sector.
    The thin film rechargeable Lithium batteries developed with our DOE 
basic research partner, the Office of Energy Research, in which ceramic 
deposition technology is used to create battery cell layers small 
enough to create batteries ten micrometers thick that are capable of 
nearly infinite recharging. The impact of this development, while 
important for existing battery applications, is that near nano size 
technologies that previously were only contemplated are now possible, 
affordable and reliable.
    The UV Waterworks water purifier using the electricity of a 
lightbulb (40 watts) to kill waterborne pathogens responsible for 
diseases such as cholera, dysentery, and typhoid that kill millions 
every year.
                         fossil energy examples
    In the past fiscal year, examples of technological advances 
resulting from Fossil Energy's Coal and Power Systems R&D program 
include:
    Successfully demonstrating two fuel cell power plants leading to 
ultra-clean, high efficiency distributed and on-site power 
applications; demonstrating an atmospheric fluidized bed combustor at a 
Veteran's Administration (VA) Medical Center for safely and cleanly 
disposing of hospital ``red bag'' waste and using the waste to generate 
clean and cost-effective electricity on site; and operating three 
utility-scale integrated gasification combined-cycle demonstration 
power plants.
    Identifying promising, innovative technologies for cost-effective, 
ultra-clean emission controls, reflecting the culmination of over 20 
years of research and development in concert with the Clean Coal 
Technology Demonstration program, to meet future, more stringent 
emissions standards at a fraction of today's cost.
    Completing a product development unit test run on co-processing of 
waste (e.g., plastics, tires) with coal for a direct liquefaction 
process proving out favorable economics and environmental benefits; 
extending the commercialization of the Microcel technology, advanced 
microbubble fine coal cleaning technology developed over the last two 
decades, to use cleaned coal fines in power generation.
    Examples of technology advances in Fossil Energy's oil and gas 
program in the last fiscal year include: Demonstrating and transferring 
to industry, using National Lab expertise, six new geophysical imaging 
technologies that will improve exploratory well success rates from a 
current average of 40 percent to 50 percent, Demonstrating five new 
data processing and simulation methods for applying advanced computing 
technology developed by national laboratories for other government 
programs to improve domestic prospects for producing natural gas and 
oil, and
    Michigan Technological University, teaming with an operator in the 
Michigan Basin, targeted production from the Dundee Formation in the 
Crystal Field, one of 137 older fields that are nearing abandonment. 
The application of horizontal drilling strategies coupled with new 
computer modeling and analysis methods has resulted in a demonstration 
well producing at a rate of 100 barrels of oil per day, 20 times the 
best conventional well in the field. The successful results have caused 
9 new horizontal wells to be permitted for drilling in the Crystal 
Field and 20-30 additional horizontal wells to be permitted in some of 
the other fields in the basin.
              benefits to the public--energy conservation
    Question. Can you also describe for those examples the benefits to 
the public resulting from the technology, as well as the reasons why 
the particular advance would not have occurred without Federal 
financial support?
    Answer. One example is the technology developed related to the 
glass industry. In addition to the direct and competitive benefits to 
the U.S. glass industry, this technology is one of the components of 
our Glass Vision of the Future ($100 million in customer savings by 
2000, one-half a million metric tons of carbon emissions displaced, and 
avoided consumption of more than 20 billion cubic feet of gas). Other 
work in our Industrial Technology Industries of the Future includes 
work on a Catalytic Converter. The cold start engine ignition is one of 
the least efficient combustion processes in the internal combustion 
engine, and on commuter trips it can be the equivalent of reducing 
vehicle fuel economy on the order of 1 mile per gallon. This new 
technology is one element of our advanced vehicle technologies program, 
the Partnership for a New Generation of Vehicles, which will develop a 
family sedan capable of 80 mpg without sacrifices in performance, 
safety or cost. These technologies will enable the U.S. to turn the 
corner on growing oil imports in the first decade of the 21st century 
and will result in annual consumer savings of $10 billion and 
concomitant carbon reductions of 25 million metric tonnes by the year 
2010.
    An additional example is our work on advanced batteries. The 
potential commercial impact of this development is to leapfrog current 
battery technology, with cheaper, smaller, more efficiently made and 
yet to be determined how many times more rechargeable batteries. While 
important for existing battery applications, its larger potential 
payback is that near nano size technologies that a decade ago were only 
imagined in science fiction will soon be possible, affordable and 
reliable.
    Our work on UV waterworks saves energy compared to conventional 
water treatment, where it exists. A more important contribution is that 
it makes water treatment easy and affordable and can readily be applied 
in parts of the world where it would not otherwise take place. 
Applications of the UV waterworks kill waterborne pathogens responsible 
for diseases such as cholera, dysentery, and typhoid that kill as many 
as four million children yearly.
    Funding from our budget request provides at least three value added 
components to these and all of our programs. The budget provides 
resources and incentives for a public policy component to business 
growth while providing simultaneous productivity, economic, and 
environmental benefits at equal or lower cost and certainly lower 
current and future social cost. In cases where technology adoption is 
at least potentially possible and socially desirable, Energy Efficiency 
and Renewable Energy programs accelerate a possible future providing 
the energy, environment and economic benefits much sooner than would 
have been likely and extending the life of existing hydrocarbon stocks 
for their highest value added contribution. A third element of our 
involvement and support is to provide a diverse resource pool of 
technologies that collectively maintain pressure on price and stability 
on narrowly held fuel supplies by continuously advancing energy science 
and technologies and providing a wide variety of options that are 
appropriate/competitive for many markets and could readily be 
accelerated and diffused widely if fuel prices or supply became 
unstable.
                 benefits to the public--fossil energy
    The examples in the Coal and Power Systems program have resulted in 
the following benefits. First generation fuel cells are now 
commercialized with 120 units sold. Demonstration of the advanced 
generation technology is needed to expand the commercialization of fuel 
cells for clean, quiet, flexible and portable electricity for 
distributed and on-site power generation. They can be used in areas 
where local and regional emissions have difficulty complying with air 
standards, in remote locations, and in U.S. military installations and 
facilities around the country and around the world to enhance 
operational security of these military bases. The development of a 
domestic fuel cell industry will lead to the creation of thousands of 
high value, domestic jobs through the launching of a new domestic fuel 
cell manufacturing industry. The atmospheric fluidized bed (AFB) unit 
at the VA hospital demonstrates the benefits of AFB technology as a 
safe and clean way of disposing of ``red bag'' waste while utilizing 
that waste to produce clean on-site power. The Integrated Gasification 
Combined-Cycle (IGCC) advances will lead to world sales of advanced, 
clean, high efficiency coal based power systems that can use a wide 
variety of coals. Worldwide deployment of IGCC will allow coal to be 
used cleanly with reduced emissions, contribute to stabilizing 
greenhouse gas emissions, and create thousands of domestic jobs through 
international sales.
    The latest concepts for environmental controls are the culmination 
of twenty years of R&D advances and the Clean Coal Technology 
Demonstration projects on environmental systems which have resulted in 
lower cost and more effective SO2 scrubbers for coal-fired 
power plants. Currently one-quarter of all U.S. electric capacity (77 
gigawatts) use these scrubbers which represent a reduction of $40 
billion in compliance cost according to a report done by Energetics, 
Inc. on the benefits/costs of the U.S. DOE Clean Coal RD&D program. 
While coal use for electric power generation more than doubled from 
1970 to 1995, SO2 and particulates came down by 27 percent 
and 90 percent respectively. In the same period, the average plant 
emission rate was lowered by 70 percent for SO2 and 90 
percent for particulate matter. In addition, a new generation of low 
NOx burners and post-combustion devices have been developed 
in partnership with industry. Burner sales have exceeded $750 million, 
and are projected to approach $4 billion by year 2000. Previously 
available technology would have cost an order of magnitude more to 
achieve the same NOx reduction. Sales of post-combustion 
technology (like Selective Catalytic Reduction) are projected at over 
$2.5 billion by year 2000. Previously, this technology cost twice as 
much as today's version.
    The advances in clean coal fuels technology have both environmental 
and long term energy security benefits. The tests on co-processing of 
waste with coal have confirmed the potential for favorable 
environmental and economic benefits for a direct liquefaction 
technology which can address the long standing environmental concerns 
with the large volume of waste plastics and mountains of used tires 
that continue to grow. Equally important, this technology offers an 
important option for addressing energy and oil security concern 
associated with our continued reliance on oil imports. The 
commercialization of the Microcel coal cleaning technology, being sold 
worldwide, is the culmination of research that started in 1980 and 
funded by the Federal Energy Technology Center. The benefits of this 
technology are that it provides a cost-effective means for emissions 
compliance prior to coal burning, it can use the over 2 billion tons of 
coal fines currently sitting in refuse ponds as fuel in clean power 
generation, and it is being used for various non-coal mineral 
processing applications around the world.
    Prototype devices for five geophysical imaging technologies have 
been completed and are undergoing field trials, and one technology has 
been commercialized. The exploratory well success rate has improved to 
48 percent for the first four months of 1996, and continued 
improvements are expected as new geophysical technologies, including 
those developed by DOE, are adopted by industry.
    The five new data processing and simulation methods projects 
successfully completed interim products. These improvements are 
expected to increase U.S. oil and gas production by 1 million barrels 
of oil equivalent starting in 2001. Accomplishments to date include: 
computer code that provides a three-fold acceleration for parallel 
processing of subsalt seismic data; multiphase fluid simulator for 
underbalanced drilling; publications on prototype computer model to 
predict geopressured reservoirs; prototype data server available on the 
Internet; and synthetic seismic data sets for a subsalt structure and 
an overthrust structure available for industry use in calibrating 
processing systems.
    Additional development in the Crystal Field alone is expected to 
recover 2 million barrels of oil. The redevelopment of other fields is 
anticipated to produce between 80 to 100 million additional barrels 
with an anticipated tax revenue of about $210 million.
                          performance measures
    Question. In reviewing the Energy R&D budget, it appears as if the 
Department has a program in virtually every area where there is a 
potential for energy savings (buildings, transportation, power 
systems). Is it possible that the Department is striving too hard to 
maintain a program in every energy ``niche'' without taking a hard look 
at the energy conservation benefits derived from these programs?
    Answer. Energy conservation, fuel diversity, social and economic 
benefits to consumers and business, public needs, and the longer-term 
are all integral to our portfolio--we strive for an energy portfolio 
that is sustainable. While striving for sustainability and diversity in 
fuel and efficiency technology, the Department works with industry and 
the public to develop the critical few technologies that meet their 
expected needs, satisfy their market demands and are responsive to the 
charge of government to meet social needs not addressed by commerce and 
States. The process we use is to engage the business and consumer 
public in describing a likely and desired future and to work together 
to develop a sustainable future--government focusing on the social and 
high-risk components of that vision and industry, business and the non-
federal government/public sector focussing on their direct 
constituency. Working together we prioritize and integrate the work and 
outcomes into a solution in which the parts work together better and 
the social and economic sum is greater than the sum of the parts would 
have been. Excellent examples of this strategy and the prioritization 
of our program focus are working in our Industry of the Future 
programs, Clean Cities, the Partnership for a New Generation of 
Vehicles, and our Federal Energy Management Program. A parallel process 
in underway in our buildings programs.
    Early in technology development when the risk is high and the 
outcome/value uncertain, we solicit input from the energy community. As 
technologies mature, we add partners with social and potential business 
interests, increasing their involvement and commitments as we advance 
elements of a technology into tools that can be adopted by the public. 
This involvement improves products and provides researchers with near 
real-time feedback for improvements, next generation technologies, 
market signals of completion, and other needs to which program 
resources might more productively be spent.
    Question. The budget justification lists performance measures such 
as ``Quads of energy saved'' for each of the major program areas. Do 
you intend to use these performance measures as a tool in formulating 
departmental budgets?
    Answer. Energy saved, energy produced, energy cost savings, 
pollution prevented, results and performance and others are integral to 
the representation of our technologies and the public and internal 
dialogue used to determine allocation of resources and a balanced 
portfolio. However, portfolio balance is not limited to these 
performance measures. Portfolio balance includes considering work that 
will be performed by others, what will not be performed if we do not 
play a role, economic risk, technology risk, hedging, intergenerational 
equity, scale, need for catalysis, and many other factors. Some of 
these factors that go into considered judgment, business decisions and 
wisdom, are neither readily quantified nor even listable. Performance 
measures are integral to budget formulation but are more fundamentally 
important indicators to determine how we are doing our work, what is 
working, what needs mending, what can be emulated, what can be 
improved, setting goals, modifying plans, helping individuals measure 
the benefit of their effort and providing the public with some measure 
of what their investment has provided.
    Question. Please provide for the record a table that shows a side-
by-side comparison of budget levels for major areas (i.e., 
transportation, buildings) and the principal performance measures or 
``metrics'' being used to measure program success.
    Answer. The attached table details budget levels for our major 
programs and progress and outcome metrics:

                                              [Dollars in millions]                                             
----------------------------------------------------------------------------------------------------------------
                                                                     Fiscal year 1998  Fiscal year 2010 outcomes
             Sector               Budget     1998 progress metric   --------------------------------------------
                                                                      MMTCE    Quads        Goal and savings    
----------------------------------------------------------------------------------------------------------------
Industry........................    $139  Three IOF visions; 2            48      1.5  Seven visions and road   
                                           signed and 1 developed.                      maps implemented, saving
                                                                                        industry $10 billion.   
Transportation..................     203  Demonstrate a 50 mpg            25       .6  An 80 mpg family sedan   
                                           family concept car.                          prototype in 2004,      
                                                                                        saving consumers $10    
                                                                                        billion.                
Buildings, States, communities..     302  Develop a strategic             67      1.6  Implement the vision and 
                                           vision for buildings,                        road map with partners, 
                                           weatherize 60,000 plus                       adding +$20 billion to  
                                           homes.                                       consumer savings in     
                                                                                        2010.                   
Federal energy management.......      31  Cut $700 million from the        1       .2  Cut government energy    
                                           Government's energy bill                     consumption by 30       
                                           over a 1985 baseline.                        percent by 2005 over a  
                                                                                        1985 baseline.          
----------------------------------------------------------------------------------------------------------------

                  state and local partnership programs
                         (performance measures)
    Question. The performance measures for Weatherization and the State 
Energy Conservation Program indicate that the Department expects the 
two programs in fiscal year 1998 to result in the conservation of .0014 
and .007 quads of energy, respectively. The fiscal year 1998 request 
for Weatherization is $154.1 million, the request for SECP is $37 
million. In light of the projected energy savings--which would seem to 
be the primary goal of the two programs--why is the Administration 
requesting the same increase for both programs on a percentage basis, 
and a vastly larger increase for Weatherization in absolute dollars?
    Answer. Although both the Weatherization Assistance Program and 
State Energy Program (SEP) have the goal of creating energy savings, 
and, indeed, significant returns are realized through both programs, 
the Administration's budget request takes into account the two 
different program structures. With regard to the SEP appropriation 
request, the Department has addressed some of the needs for SEP 
activities by complementing them with DOE end use conservation program 
activities which also were targeted for implementation by States, 
consistent with states' Annual State Plans under SEP. These SEP Special 
Project activities funded from other DOE conservation programs are 
expected to continue in fiscal year 1998.
    Under SEP, annual appropriations are allocated to States by formula 
and are used for program projects specified in each State's approved 
plan. SEP has consistently leveraged $4 of Petroleum Violation Escrow 
(PVE), State, local and private funds for every $1 of appropriated 
funds. The addition of SEP Special Projects has expanded the program, 
allowing States to implement State-oriented building, industrial, 
transportation and utility sector projects. Special Projects 
contributions from DOE end use programs of $11.2 million in fiscal year 
1996 and $9.8 million in fiscal year 1997 represented an increase of 38 
percent over the total of $55 million appropriated for SEP in those two 
years. SEP enables States to address both local energy priorities and 
National energy initiatives. The Administration's budget projects an 
overall energy savings of .007 quads from all sources of funding.
    In contrast, the Weatherization Program utilizes partnerships 
between State and local-level weatherization agencies. Specifically, 
DOE awards grants to States, which then award grants to the local 
agencies, usually community action agencies or other nonprofit or 
government organizations, to perform the actual services. Nearly 14 
percent of currently eligible households have received weatherization 
services. Low-income households spend about 14 percent of their annual 
income on energy vs. 3.5 percent spent by other households. The program 
provides a benefit of $2.40 for every dollar invested in Weatherization 
and leverages an additional $3.39 from other Federal, State, local, and 
private sources. Additional benefits include: improvement of 
neighborhood housing conditions, reduction of power plant emissions, 
and providing education and practice with regard to newly developed 
conservation tools, materials, and techniques. The Administration's 
1998 budget anticipates direct energy savings of .0014 quads from the 
DOE funding only. Thus, total savings from all funding sources are 
approximately three times greater.
    Question. Are we getting the biggest ``bang for the buck'' with 
this allocation of Federal dollars?
    Answer. Both the Weatherization Assistance Program and the State 
Energy Program (SEP) are cost-effective energy programs. The Department 
has recognized the impressive program impacts of SEP by utilizing it to 
implement State-oriented Special Projects in the buildings, industrial, 
transportation, and utility sectors. Special Projects contributions of 
$11.2 million in fiscal year 1996 and $9.8 million in fiscal year 1997 
from DOE end use programs represent an increase in the dollars 
allocated to SEP by 38 percent over the appropriated total of $55 
million for fiscal year 1996 and fiscal year 1997. SEP Special Projects 
funding from DOE conservation programs is expected to continue in 
fiscal year 1998.
                          energy conservation
                         arthur d. little study
    Question. Some time ago, Arthur D. Little performed an analysis of 
the Department's ``quality metrics.'' That study seemed to show that 
the Department has overestimated the benefits of many of the Energy 
Conservation programs funded in this bill. What is the Department's 
response to the Arthur D. Little study?
    Answer. The Arthur D. Little (ADL) study was used by DOE in 
formulating the fiscal year 1998 request. DOE used the most 
conservative estimates at hand while formulating the budget, and these 
estimates were very close to the final numbers arrived at by DOE with 
ADL review and assistance. While the final numbers in many cases were 
smaller than the preliminary energy savings, the benefits to the nation 
in energy productivity improvements, pollution prevention, and national 
security still demonstrate that energy efficiency and renewable energy 
technology programs are important to the nation. ADL stated ``Overall * 
* * the selection of technologies in the DOE (Energy Efficiency) 
portfolio are very reasonable. They are in line with R&D programs of 
other industrialized countries and have gained a high level of industry 
support in the U.S. The portfolio mix in the post 2000 time frame will 
place the U.S. in a highly competitive position in the coming 
decades.''
    Question. Are the results of the study reflected in the fiscal year 
1998 budget request? Have the budget requests for certain programs been 
increased or decreased in part because of this study?
    Answer. The analysis of the expected energy savings in the future 
allowed DOE management to gain an understanding of how these programs 
related to DOE's strategic goals of maximizing energy productivity, 
preventing pollution, and enhancing our energy and national security. 
The analytical information from the study informed the decision making 
process in DOE as the fiscal year 1998 budget was developed, although 
other considerations also drive the Department's investment decisions, 
including priorities of the Administration, legislative requirements, 
stakeholder assessments of market opportunity, as well as the desire to 
capture benefits that are not easily monetized such as environmental or 
national security benefits. The use of portfolio selection criteria for 
our budget decision analysis is complex, and we are not able to ascribe 
specific increases and decreases in our request directly to a single 
set of criteria.
    Question. Will the department continue to use such outside reviews 
to shape its programs and budget requests?
    Answer. Yes, this year we are planning to expand our external 
review to a broader array of experts from business, industry, academia, 
and both government and non-government public sector.
    Question. Will such reviews contribute to the Department's planing 
process pursuant to the Government Performance and Results Act?
    Answer. The Office of Energy Efficiency and Renewable Energy has 
traditionally asked for stakeholder input for developing its strategic 
plans, portfolio planning, validation of metrics and performance. In 
response to the Government Performance and Results Act we have 
broadened our measures, exposition of measures and plans, and feedback 
from the entire spectrum of the public interested in EE's plans, 
performance and outcomes.
                             transportation
                   infrastructure, systems and safety
    Question. A significant increase is requested for Infrastructure, 
Systems and Safety. Is the entire increase attributable to commencement 
of Phase II of the corridor development program?
    Answer. The fiscal year 1998 budget for Infrastructure, Systems, 
and Safety requests a $3.1 million increase over fiscal year 1997. Of 
the increase, $2.5 million is for Phase II of a nationwide 
infrastructure and corridor development program. The additional 
$600,000 is requested to expand and refine systems and safety analysis 
of refueling, transport, and delivery infrastructure for alternative 
fuels.
    Question. Exactly what does Phase II of the program entail?
    Answer. Starting in 1995, the Department has worked with the Clean 
Cities and States to encourage private investment in refueling 
development in key regions and along key transportation corridors. We 
have supported State efforts to expand ethanol infrastructure in the 
Midwest, and liquefied natural gas corridor development in the West, 
among others. The Department's infrastructure and corridor development 
strategy encourages the use of Clean Cities as ``anchors'' in a 
strategic ``backbone'' that can dramatically increase the 
attractiveness of alternative fuels for fleets. In fiscal year 1997, we 
are launching Phase I of our nationwide program by building on the 
successes of these early pilot efforts. Phase I will involve sharing 
lessons learned; bringing local, State and regional organizations 
together to develop strategic plans for infrastructure and corridor 
development; increasing private participation; and providing grant 
funding to the States of about $1 million to catalyze infrastructure 
and corridor efforts. In fiscal year 1998, Phase II will strengthen 
that effort, provide a second-round of funding to Phase I participants, 
and expand the program to additional regions.
    Question. How many years will it take and what are the expected 
costs?
    Answer. Analytical work by the Department has indicated that the 
success of alternative fuel vehicle programs will depend in large 
measure on the availability of sufficient refueling infrastructure. 
This finding has been confirmed by fleet operators and other 
stakeholders in Departmental hearings. The Department's financial 
investment is insignificant relative to the private investment that 
must be the driving force for any significant penetration of 
alternative fuel or electric infrastructure if these fuels are to be 
competitive. However, a small but significant investment by the 
Department of $3-10 million per year for the next five years could be 
instrumental in catalyzing the growing alternative fuel market, 
supporting existing private investment, and attracting additional 
private investment.
    Question. How will monies appropriated in fiscal year 1998 be used?
    Answer. These funds will be used to catalyze Clean Cities and State 
cost-shared efforts that leverage significant private investment and 
increase the use of other Federal funding, such as Federal Highway 
funding. Infrastructure and corridor development projects typically 
include analytical work, planning, market development, public 
education, and acquisition and construction of refueling stations, of 
which the Department's funding plays a small but significant part.
    Question. What would be the impact of level funding or a much 
smaller increase?
    Answer. Level funding would not allow the Department to expand 
successful programs to other States and regions of the country, 
reducing the potential for a nationwide market for alternative fuels; 
and would not allow the Department to conduct the analyses needed to 
support an expanded market. A smaller increase than requested would 
restrict the number of regions.
                     vehicle field test/evaluation
    Question. A $1.3 million increase is requested for Vehicle Field 
Test/Evaluation, some of which will be used to acquire and test new 
electric vehicles. For whose use are these vehicles being purchased?
    Answer. The vehicles will be purchased for testing and evaluation 
by both public and private fleets. The two private organizations are 
Southern California Edison in conjunction with the California Air 
Resources Board and AAA of Southern California Systems; and Electric 
Transportation Applications in conjunction with Arizona Public Service, 
Salt River Project, Potomac Electric Power Company, and Underwriter's 
Laboratory. These two qualified vehicle test sites will purchase a 
limited number of electric vehicles for testing and evaluation on at 
least a 50 percent cost-share basis. Historically, additional utility 
expenditures increase the private cost-share percentage to well above 
50 percent. Another portion of the funds will be made available to the 
Federal agencies to procure electric vehicles in accordance with 
Executive Order 13031 for testing and evaluation within the Federal 
fleet. Operational data will be provided by the agencies to the 
Department of Energy.
    Question. Is this the first year in which funds in this activity 
will be used to actually purchase vehicles?
    Answer. No, the program has provided funds on a cost-shared basis 
to purchase several thousand electric vehicles for testing, evaluation, 
and demonstration in both public and private fleets since its start in 
1977. The program was known as the Site Operators Program until 1994.
    Question. How many vehicles will be purchased?
    Answer. The private organizations will purchase approximately 50 
electric vehicles for testing and evaluation under this program. For 
Federal agencies, the expectation is to provide sufficient funding to 
test and evaluate up to 100 electric vehicles within the Federal fleet, 
bringing the total number of electric vehicles funded by fiscal year 
1998 funds to about 150.
                      advanced battery development
    Question. $15.8 million is requested for Advanced Battery 
Development. Will the Department continue work on the mid-term nickel 
metal hydride battery in fiscal year 1998?
    Answer. The Department anticipates that the United States Advanced 
Battery Consortium will complete all work on the mid-term nickel metal 
hydride battery in fiscal year 1998.
    Question. Are fiscal year 1998 funds requested for this purpose?
    Answer. About $1.0 million is requested for fiscal year 1998.
    Question. What is the status of this development effort?
    Answer. Both development contractors are establishing the 
capability to manufacture this battery in response to market demand. 
The cost reduction programs begun in fiscal year 1996 are improving the 
ability of this technology to compete in the marketplace.
    Question. How much is requested in fiscal year 1998 for work with 
the long-term lithium-based technology team?
    Answer. The Department estimates that $12 million will be used to 
support the long-term lithium-based technology team.
    Question. If funded in fiscal year 1998 at the request level, how 
much does the Department anticipate will be required in fiscal year 
1999 for this effort?
    Answer. The Department estimates about $4 million will be required 
in fiscal year 1999 to fund currently planned efforts. It is 
anticipated that the United States Advanced Battery Consortium may 
request additional funding in fiscal year 1999 for long-term advanced 
battery development.
                       hybrid propulsion systems
    Question. $45 million is requested for Hybrid Propulsion Systems, a 
$6.15 million increase from fiscal year 1997. What would be the impact 
on program schedule if funding were held at the fiscal year 1997 level?
    Answer. Reducing the budget to the fiscal year 1997 level will not 
only hurt the base program to develop a propulsion system capable of 
achieving 50 mpg in a mid-size automobile but will also have a 
significant negative impact on the development time for technologies 
that have the potential to be used in the Partnership for a New 
Generation of Vehicles (PNGV) program that are currently under 
development in the current contracts. Some technologies are strong 
candidates to move on to the next phase, Phase II, aimed at the 80 mpg 
target. If these candidate technologies are not funded in fiscal year 
1998, the outcome will be to significantly increase the risk to achieve 
the 80 mpg fuel economy and stringent emission targets by the 2004 time 
frame because of the compressed development time. Level funding will 
also cause the current program to be extended by at least six months, 
moving the delivery of test bed vehicles into the mid-1999 time frame 
and increasing the overall cost of the program. This will delay 
obtaining important vehicle integration test data which will benefit 
solving integration issues in the Phase II program. The increased 
budget request is also directed at developing a broader supplier base 
of innovation and competition from which the automobile companies can 
draw to improve the chances for program success and reduce the risk of 
having a very limited number of suppliers on which to rely. Many 
smaller companies have unique and innovative technologies that have not 
been part of the current program. This budget request accounts for 
identifying these very promising companies whose ideas have not been 
evaluated and integrated into the existing partnership.
    Question. What if funding were increased by only half the requested 
amount?
    Answer. Reducing the budget to half the requested increase would 
impact the planned expansion of the supplier base and thus increase the 
risk for program success.
    Question. Does the Department anticipate a further increase will be 
requested in fiscal year 1999?
    Answer. Planned funding for fiscal year 1999 is expected to remain 
at the fiscal year 1998 requested level because the next phase of the 
hybrid program, Phase II, requires further efficiency improvements in 
the propulsion system and advances in vehicle systems, such as, lighter 
weight materials and reductions in accessory loads resulting from more 
efficient designs.
                       high power energy storage
    Question. The request for High Power Energy Storage nearly doubles 
to $15 million. What would be the impact on program schedule if funding 
were held at the fiscal year 1997 level?
    Answer. High power energy storage is one of the performance-
limiting subsystems in hybrid vehicles for PNGV. High power batteries, 
ultracapacitors, and flywheels have been identified as potential energy 
storage candidates. If funding were held at fiscal year 1997 levels, 
the effort to scale up laboratory high power battery cells to 50-volt 
modules would be stretched out, and promising baseline battery 
technologies would be prematurely eliminated. This will triple the risk 
of failure; and the stretch-out would delay the fiscal year 1999 start 
of the development of the required 400-volt energy storage system for 
PNGV. Laboratory ultracapacitors will not be transitioned to industry 
for scale up. Flywheel efforts will be drastically reduced or 
eliminated. Seventy-five percent of the exploratory research aimed at 
improving power density, cycle life, and charge acceptance of the 
candidate high power technologies will be eliminated or deferred.
    Question. What if funding were increased by only half the requested 
amount?
    Answer. If only half of the increase is funded, the development 
effort to scale up one of the three laboratory high power battery 
technology options to 50-volt modules would continue on schedule for 
fiscal year 1998. Risk of failure would be reduced to double; and the 
development of the required 400-volt energy storage system would not 
begin until mid-fiscal year 1999, about a year delay. Laboratory 
ultracapacitors will not be transitioned to industry for scale up. 
Flywheel efforts will be reduced--delaying the development of models 
and a safe containment system. This would move flywheels out of the 
PNGV time frame. Fifty percent of the exploratory research aimed at 
improving power density, cycle life, and charge acceptance of the 
candidate high power technologies will be eliminated or deferred.
    Question. Does it make sense to consider the requested increases 
for this activity and for Hybrid Propulsion Systems in tandem, i.e., 
should any increases provided be proportional?
    Answer. No, it does not make sense to consider the requested 
increases for this activity and for Hybrid Propulsion Systems in 
tandem. The development of the high power energy storage system is not 
paced by the development activity of the hybrid propulsion system, but 
rather by the considerable research and development effort that is 
required to mature the energy storage technology from potential 
laboratory-scale devices to full-size, 400-volt energy storage systems. 
Since this development effort is a long-lead, critical component R&D 
item for a viable hybrid propulsion system, the development effort 
needs to be accelerated with additional resources. Its funding should 
be considered as a separate activity that is required for the 
development of hybrid vehicles.
                             fuel cell r&d
    Question. Within the request for Fuel Cell R&D, there is a 
significant shift away from Systems Development and towards Component, 
Reformer and Storage R&D. What is the reason for this shift?
    Answer. The previously funded system efforts with General Motors, 
Ford, and Chrysler-Pentastar have been successful in identifying system 
level requirements and research challenges associated with the 
components which make up a fuel cell system for automotive 
applications. Therefore, the shift reflects the program's emphasis on 
working directly with fuel cell suppliers for the development of an on-
board fuel-flexible fuel processor capable of operating on gasoline, 
methanol, ethanol, or natural gas. Previous research and development 
has identified key barriers to this technology which will be addressed, 
i.e., improved carbon monoxide clean-up devices; compact, efficient 
heat exchangers; and integrated fuel processor components (fuel 
purification system, heat exchangers, controls and sensors), into a 
vehicle-ready 50 kW system capable of rapid start-up and fast transient 
response. In addition, increased component R&D is necessary to reduce 
size, weight, and cost of the current fuel cell stack for automotive 
applications. R&D activities will focus on membrane-electrode 
assemblies using lower platinum loadings or non-platinum catalysts; 
low-cost, lightweight bipolar plates; high efficiency, compact 
compressors; and materials/processes amenable to low-cost, high-volume 
manufacturing. The system effort in the out years may increase to 
address R&D challenges associated with integration of the 50 kW fuel-
flexible fuel cell system into a vehicle. Plans are that vehicle 
integration efforts would be done at 50-50 cost share.
    Question. Does the Department anticipate requesting a further 
increase for Fuel Cell R&D in fiscal year 1999 if funded at the request 
level in fiscal year 1998?
    Answer. The fiscal year 1999 request will depend on the current 
progress of the program. If fuel processor and fuel cell stack R&D 
activities are successful, additional funds will be needed for 
validation of these technologies in integrated fuel cell systems, and 
for testing these systems under normal drive cycles and required 
operating conditions (e.g., start up at 40 deg.  C) in a test bed 
vehicle. If key technical targets for fuel processor and fuel cell 
component technologies are not achieved, a sustained funding at the 
fiscal year 1998 level will be required to accomplish the R&D 
challenges associated with these major components.
    Question. What does the Department make of recent demonstrations of 
fuel cell vehicles by foreign automobile manufacturers?
    Answer. The recent demonstrations of fuel cell vehicles by Daimler-
Benz and Toyota indicate to the Department that the potential benefits 
of fuel cell technology are clearly recognized worldwide. Furthermore, 
it also indicates that the promise of fuel cells is sufficiently bright 
that private industry, in partnership with government, is committed to 
sharing in the costs of future research needs. On the other hand, while 
these early demonstrations of research vehicles highlight the potential 
for fuel cell technology, there still is a great deal of enabling 
research and development work on components and systems that must yet 
be completed to meet automotive requirements in terms of performance 
and driving range.
    Question. Where do United States manufacturers stand in comparison 
to Japanese and European manufacturers in fuel cell development?
    Answer. For stationary power generation, U.S. fuel cell 
manufacturers are clearly the world leaders, a position resulting from 
the significant U.S. government investment in stationary fuel cell 
technologies. For transportation fuel cells, where U.S. government 
investment has been comparatively smaller to date, U.S. developers are 
facing fierce competition from abroad where public and private 
investment has increased dramatically recently. As a result, U.S. 
manufacturers are slightly behind, but narrowing the gap, in fuel cell 
stack technology. To their credit, U.S. developers are equal to or 
slightly ahead in fuel processing technology at this time.
    Question. How dependent is the successful deployment of fuel cell 
technology on the development of advanced battery technology?
    Answer. Development of advanced battery technology, like improved 
electric drive systems or lightweight materials, could certainly 
contribute to enhancing the successful deployment of fuel cell 
vehicles. Advanced batteries could ameliorate the requirements 
currently placed on fuel cells in terms of their power density and 
needed start-up time. However, fuel cell vehicle conceptual designs 
being pursued include either stand-alone fuel cells operating with on-
board hydrogen storage which require no batteries, or alternatively, 
liquid fueled fuel cells which are battery augmented. Thus, depending 
upon the particular design approach and fuel used, fuel cell vehicles 
may or may not be dependent upon advanced battery technology.
    Question. There recently were trade press reports describing the 
discovery of carbon materials that could potentially provide hydrogen 
storage sufficient to give a fuel cell vehicle a 5,000 mile range. Has 
the Department reviewed this information? Could this discovery have any 
impact on near or medium-term fuel cell development?
    Answer. The Department is aware of the published results of the 
data generated by Northeastern University and has sent researchers to 
the university to observe the tests and talk to the Principal 
Investigators. The results reported by the university indicate a 
relatively large amount of hydrogen fuel could be stored and are 
significantly different from results reported by other laboratories for 
carbon-based storage systems. These results appear to warrant further 
validation.
    This technology is relevant to hydrogen storage onboard a vehicle 
and is not directly related to fuel cell development. However, if this 
material could be incorporated into a storage system with a fuel cell, 
it would solve one of the many challenges facing the introduction of 
fuel cell vehicles.
                    advanced automotive technologies
    Question. The ``metrics'' for the Advanced Automotive Technologies 
program appear to be about 2-3 times higher than those for Advanced 
Heavy Vehicle Technologies, but the funding request is approximately 7 
times higher. How does the Department account for this seeming 
imbalance?
    Answer. Both of these programs have the potential to be cost-
effective ways to reduce petroleum dependence in the transportation 
sector and deserve strong government support. Advanced Heavy Vehicle 
Technologies is a new program that has grown at only a modest rate 
because of the major financial commitments to the domestic auto 
companies.
    The heavy vehicle program is modifying an existing diesel engine 
technology that has been in operation for many years to make it 
cleaner, more efficient, and useable in light trucks. While this is a 
formidable technical challenge, it is less challenging than designing 
technologies that will introduce electric drives, battery use and 
storage, alternative fuels, and fuel cells into automobiles.
    Question. The budget request indicates that the Department is 
targeting development of highly clean and efficient diesel engines for 
heavy trucks, and hopes to devolve this technology to increasingly 
popular light trucks/sport utility vehicles. Are the Department and its 
partners concerned that the popularity of light trucks might be on the 
wane by the time diesel technology is developed for use in light 
trucks?
    Answer. Industry market studies indicate that light trucks/sport 
utility vehicles will continue to increase from 47 percent of light 
vehicle production in 1996 to somewhat over 50 percent by 2001, when it 
is expected to stabilize. These classes of vehicles have relatively 
poor fuel economy compared to automobiles, worsening the oil use 
situation in the U.S. This situation is substantially driven by the 
continuing availability of low-cost petroleum, which is expected to 
continue well beyond the date of introduction of the clean diesel 
engine to light trucks. Regardless of whether the popularity of these 
vehicles continues to increase or decline, there is still the 
imperative to increase their efficiency. Simple substitution of a low 
emission, high efficiency diesel engine for the conventional gasoline 
engine will increase its miles per gallon by 50 percent.
    Question. The budget request for Automotive Materials Technology/
Propulsion Materials is reduced by $2.25 million. What is the impact of 
the reduction in Propulsion Materials?
    Answer. The major activity in the Partnership for a New Generation 
of Vehicles gas turbine effort in fiscal year 1998 is the development 
of ceramic manufacturing technology for critical gas turbine 
components, including a high speed rotor, combustor, and heat recovery 
system. The reduction in the Automotive Propulsion Materials budget 
will reduce the scope and stretch the schedule of the industry effort 
in ceramic manufacturing of these parts and the supporting technology 
programs at national laboratories and universities. The schedule for 
the go/no-go decision on the turbine option will be delayed until mid-
2000 because of the funding reduction.
    Question. If funded at the request level, will the Department have 
sufficient information on key components to make a go/no-go decision on 
the turbine option by mid-1999?
    Answer. If funding were restored to the fiscal year 1997 level of 
$6.5 million, it is expected that the ceramic manufacturing technology 
effort could be accelerated sufficiently to make a go/no-go decision by 
the end of 1999 to determine if the gas turbine remains a viable 
candidate for incorporation into the PNGV 2002 concept vehicle.
           northwest alliance for transportation technologies
    Question. In the last year the Department has joined in supporting 
the formation of the Northwest Alliance for Transportation 
Technologies. What benefit does the Alliance add to the DOE 
Transportation program in terms of expertise, coordination and other 
factors?
    Answer. The development of an ultra-high mileage and 
environmentally friendly vehicle of the future will require the 
introduction of lightweight materials into vehicle production while 
maintaining structural integrity, strength, and safety.
    PNGV identifies aluminum, magnesium, titanium, and polymer 
composites as enabling lightweight materials. Before these materials 
find extensive use in automobiles, enabling manufacturing technologies 
that significantly reduce the cost of primary aluminum, magnesium, 
titanium, and polymer composites are required. Furthermore, the forming 
and joining of these materials for automotive applications will need to 
be addressed. The Northwest aerospace industry has been a world leader 
in the utilization, forming, and joining of lightweight materials. The 
infrastructure surrounding the Northwest aerospace industry includes 
primary aluminum, magnesium, titanium, and composite manufacturers 
(Tier I), as well as part forming and materials joining manufacturers 
(Tier II).
    The Northwest Alliance for Transportation Technologies (NATT) will 
significantly benefit the DOE Transportation Technologies program by 
accessing and utilizing the established aluminum, magnesium, titanium, 
and composite manufacturing expertise built around the Pacific 
Northwest aerospace industry to address the critical lightweight 
materials objectives of PNGV. Also, NATT will provide an avenue for 
Tier I and II materials suppliers to play an active role in the DOE 
Transportation Technologies program. Tier I and II suppliers will 
ultimately be responsible for both reducing the cost of critical 
lightweight automotive materials and producing automotive production 
quantities.
    The NATT will coordinate collaborative projects with industry, 
national laboratories, and universities to develop enabling 
manufacturing technologies that will lead to an increased use of 
lightweight materials in automobiles. One objective of these 
collaborative projects is to team with primary suppliers of aluminum, 
magnesium, titanium, and composites, such that technical advances can 
rapidly move manufacturing volumes required for the transportation 
industry. NATT will also coordinate projects to develop advanced 
forming and joining technologies that more effectively utilizes 
lightweight materials.
    Question. Does the Department anticipate a continued productive 
working relationship with the Alliance?
    Answer. Yes, the Department anticipates a very productive 
relationship with the Alliance, continuing to build on the partnerships 
established in fiscal year 1997. The introduction of lightweight 
materials into the transportation sector is critical for all future 
vehicle concepts. NATT not only allows the lightweight materials 
expertise developed in the aerospace industry to be accessed and 
utilized but it also incorporates the critical Tier I and II aluminum, 
magnesium, titanium, and composite materials manufacturers need to 
reduce primary and secondary material costs. NATT comprises an integral 
part of existing DOE transportation programs.
    Question. What are some examples of work to be performed by the 
Alliance in fiscal year 1998?
    Answer. fiscal year 1998 projects will focus on developing enabling 
technologies that lead to both the near term and longer term 
introduction of aluminum, magnesium, titanium, and polymer composites 
into automotive vehicles. Projects will address specific PNGV needs not 
currently funded by the DOE Transportation Technologies program. 
Project areas will include development of manufacturing processes that 
reduce the cost of primary magnesium, development of manufacturing 
processes that reduce the cost of primary titanium, development of 
aluminum forming processes that increase the utilization of aluminum in 
automobiles, and innovative development of fiber reinforced composites 
for automotive applications.
                           program direction
    Question. The justification indicates that the Program Direction 
activity for fiscal year 1997 is being evaluated to address a projected 
end-of-year shortfall of $650,000. How does the Department plan to 
address this shortfall?
    Answer. The Department is addressing this shortfall by implementing 
several actions. To date, the Office of Energy Efficiency and Renewable 
Energy has requested and received approval from the Office of the Chief 
Financial Officer to recover prior year deobligations (PYD), which had 
resulted from the close-out of expired contracts, to offset the 
projected shortfall. These prior year deobligations from various 
Sectors plus carryover balances from the Industry Sector were 
internally reprogrammed to the Transportation Sector's Program 
Direction area, in accordance with Congressional guidelines and 
thresholds.
    Question. Why has a ``contingency'' of $300,000 been requested for 
fiscal year 1998?
    Answer. The contingency of approximately 4.7 percent is requested 
to accommodate variables such as payment for overtime and compensatory 
time, promotions and within grade salary step increases, benefits for 
former personnel, and other similar types of payroll activities to help 
preclude the need for a reprogramming action.
    Question. The $210,000 requested for employee incentive awards 
appears to mean an average of more than $3,500 per person. Assuming not 
all employees will earn incentive awards, is the amount requested 
appropriate?
    Answer. Although it is not envisioned that all employees will earn 
an incentive award we believe the $210,000 is the appropriate amount 
for special act and service awards, employee incentive awards, and 
group awards.
                            buildings sector
Building America
    Question. The request for Building America indicates that industry 
teams will transfer system innovations to 15,000 homes over the next 
four years. Why is it necessary to demonstrate innovative systems in 
15,000 homes before such systems are adopted as regular industry 
practice?
    Answer. It is projected by the year 2000, the Building America DOE/
Industry cost-shared partnership will have developed 2,000 highly 
energy efficient, environmentally friendly, and cost-effective houses 
in a number of communities. The technical dissemination, not 
demonstration, spinoff to regular industry practice is anticipated to 
be 15,000 houses constructed by other builders and developers applying 
the Building America system integration methods currently under 
development.
    Question. How many states currently have Building America programs?
    Answer. At present, the four Building America teams have projects 
under construction or to be initiated during fiscal year 1997 in 11 
states: Arizona, California, Florida, Idaho, Illinois, Massachusetts, 
Nevada, New York, North Carolina, Pennsylvania, and Texas. The four 
Building America teams are composed of a total of more than 70 
industries in 27 states: Arizona, California, Connecticut, Colorado, 
Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kentucky, Maryland, 
Massachusetts, Michigan, Minnesota, Nevada, Pennsylvania, New 
Hampshire, New Jersey, North Carolina, Ohio, Rhode Island, Virginia, 
Tennessee, Texas, Washington, and Wisconsin.
                    home energy rating system pilots
    Question. $1.5 million is requested to continue Home Energy Rating 
System pilots in seven states. What progress have the pilot states made 
in implementing HERS?
    Answer. The objective of the pilot states effort has been to 
overcome the barriers to the use of home energy rating systems and 
energy efficiency financing. Progress in meeting these objectives has 
been constant in the seven HERS pilot states. Over $150 million in 
energy efficiency mortgages were issued in these states through the 
spring of 1996 and a substantial amount of additional energy measures 
were installed based on ratings. Tens of thousands of ratings have been 
conducted and thousands of lenders, realtors, builders and appraisers 
have been trained.
    Question. When does the Department propose to cease requesting 
funding for the existing pilots?
    Answer. Funds for the pilot states will be reduced under the fiscal 
year 1998 budget proposal and not requested for fiscal year 1999.
    Question. When the pilots are complete, will the Department propose 
to divert funds from existing pilots into new states, or does the 
Department feel HERS will be sufficiently demonstrated in the existing 
pilot states to allow states to establish their own programs 
independently?
    Answer. There is not a need to replicate the large scale multi-year 
pilots. Technical assistance to other states however, will be necessary 
to achieve national acceptance of HERS and increased access to energy 
efficiency financing.
                             best practices
    Question. In the justification for the Best Practices activity, a 
number of software development programs are described as having 
generated large energy savings for users. What unique advantage or 
expertise does the Department have in developing this software that 
could not be provided by a private software development firm?
    Answer. The Department's role in software development stems from 
its need for energy-focused whole buildings software to carry out its 
research and development activities, and requests from industry to 
partner with it to develop software responsive to the defined needs of 
industry in the predesign, design or redesign in the case of 
renovation, commissioning and operation of buildings. The software 
developed for, and stemming from, research and development forms the 
basis for that developed with industry partners.
    The process of ongoing consultation and interaction with industry 
so that software is responsive to its needs is time-consuming and 
costly. No single, private software developer has exhibited the ability 
to invest the time required for validated, energy-focused software 
tailored to the specific steps of the predesign, design and redesign, 
commissioning and operation of buildings. The software needs for 
specific types and sizes of buildings vary, further reducing the 
private developer's ability to absorb the financial risks. In addition, 
as new technologies and design know-how emerge as a result of research 
and development, the software must be updated, adding even more 
financial commitment and risk.
    The objectivity, comprehensiveness and credibility associated with 
the Department/industry-developed software are crucial. These qualities 
tend to be perceived as, and oftentimes are lacking in the limited, 
narrowly-focused commercially available energy software that does 
exist, thereby discouraging energy-conscious building design.
    Question. Does the Department anticipate continuing to develop this 
type of software into the foreseeable future?
    Answer. To fulfill its research and development responsibilities, 
the Department must continue to improve software. As long as the 
financial risk is high and industry asks to work with the Department on 
software improvements capable of meeting its needs, it is essential 
that the Department continue its partnerships. Valid building energy 
simulation software is essential if industry is to have the tools it 
requires to properly integrate efficiency and renewable energy design 
know-how and technologies into buildings and have confidence that the 
buildings will perform as anticipated.
    Moreover, because it is the Department's mission to encourage 
adoption of new know-how and technologies, there must be a process in 
place to assure that the tools needed to facilitate adoption are 
available. And, the Department must assure that procedures needed to 
verify the reliability of software continue to be improved. Adding 
capabilities as new knowledge and technologies emerge tends, however, 
to be a less intensive process than the original development of the 
software. Thus, it is expected that once the software industry wants 
and needs are met, a less intense effort will be required.
                           hi-cool heat pump
    Question. $2,150,000 is requested for development of a Hi-cool Heat 
Pump, which the justification indicates will be ready for market 
introduction in 2005. What is the funding profile for this program?
    Answer. This program began in fiscal year 1993 at $450K and 
progressed as follows. fiscal year 1995 $1.0 million, fiscal year 1996 
$600K, fiscal year 1997 $900K, fiscal year 1998 $2.1 million. Funding 
to date has produced two candidate advanced cycle absorption heat pumps 
concepts that will be further developed into prototype heat pumps with 
a cooling performance of 30 percent better than other cooling devices. 
When fully developed these technologies can penetrate the southern tier 
markets where cooling is the dominant mode of energy use for space 
conditioning.
    Question. Does the optimal funding ``curve'' have a large peak in 
some future fiscal year?
    Answer. As development of ``Hi-cool'' systems progresses, each 
successive phase requires increased funding. Hardware development of 
components (initiated in 1997) requires a higher level of funding than 
concept evaluation which is mainly an analytical effort. The laboratory 
development and testing of complete heat pump systems requires more 
funding than development of individual components. In the later stages 
of the project, these increases will be somewhat offset by increased 
cost sharing by industry. Industry will fund 50 percent of the field 
testing phase.
    Question. If so, when and how much will be required?
    Answer. The required Departmental funding needed to carry this 
program through all phases is indicated in the table below:

------------------------------------------------------------------------
Phase               Activity                Fiscal year    Phase funding
------------------------------------------------------------------------
   IConcept evaluation                       1994-1997      $3,800,000  
  IIComponent development                    1997-2002       7,000,000  
 IIISystem development                       2001-2004       6,000,000  
  IVField testing                            2004-2005       1,000,000  
------------------------------------------------------------------------


    Question. Are the alternative Hi-cool heat pump cycles being 
evaluated as an alternative to the design being developed for market in 
2005, or as a follow-on technology?
    Answer. In fiscal year 1997, the ``Hi-cool'' program is developing 
critical components at small business R&D firms for two of the concepts 
evaluated in Phase I. The one or two alternative Hi-Cool cycles being 
further evaluated in 1998 are additional highly-ranked Phase I concepts 
which are possible alternatives to the two now undergoing hardware 
development. Modest parallel development of these concepts with 
additional small business contractors lowers the overall risk in the 
project by maintaining a range of technical options during the critical 
component development phase. All concepts are being evaluated for 
potential market introduction in the year 2005.
                    large commercial chiller program
    Question. The justification indicates that the Large Commercial 
Chiller program with York International will be completed. To what 
degree will DOE participate in getting this technology ``ready for 
commercialization * * *''?
    Answer. Testing of a prototype 40 refrigeration ton DCC chiller at 
York International will begin in mid 1997 and continue into early 
fiscal year 1998. Using laboratory test results and a newly designed 
advanced direct fired burner, a pre-production 400 ton DCC chiller will 
be fabricated and readied for field testing in late fiscal year 1998. 
The estimated completion date for field testing of the 400 ton 
production ready chiller will be early fiscal year 1999. The cost share 
from York International for field testing will be 50 percent.
    Question. Is 35 percent the total cost share for the entire 
program, or just for the current stage of the program?
    Answer. The current program is cost shared by York International at 
35 percent however, this will increase to 50 percent for the field 
test.
                    advanced desiccant technologies
    Question. The budget request includes $2 million for advanced 
desiccant technologies. What is the funding profile for the remainder 
of this program?
    Answer. The current research plans for both solid and liquid 
desiccants which extend through the year 2000 would require level 
funding.
    Question. If funded at the request level in fiscal year 1998, does 
the Department anticipate requesting funding for this program in fiscal 
year 1999?
    Answer. Yes. Current projects are focused on solid desiccants 
technology application in large commercial buildings because solid 
desiccants are further along in their development and are available for 
test and evaluation. Research and development of enabling technologies 
for Indoor Air Quality (IAQ), and the development of sensors and 
specialized control will take full advantage of the energy saving and 
air quality improvement potential of solid desiccant-based air 
conditioning equipment. A need exists to establish desiccant based 
systems as mainstream HVAC equipment for indoor air quality and comfort 
control. HVAC and comfort control systems based on liquid desiccants is 
planned as part the longer term program.
    Question. What level of cost-sharing has been achieved in this 
program?
    Answer. There are two contracts in place for developing desiccant 
systems, one with SEMCO/Trane which has 37 percent cost-sharing and one 
with ICC/Englehard which has 63 percent cost-sharing. In addition, 
manufacturers of desiccant wheels being tested at NREL have donated 
their wheels and will continue to cost share as advanced wheel 
development is achieved. Gas industry cost share is in the form of site 
selection for test and evaluation of desiccant systems and a 
willingness to cost share in the testing and data collection.
                 fuel cell building micro-cogeneration
    Question. $1.7 million is requested for Fuel Cell Building Micro-
Cogeneration. When does the Department hope to achieve development of a 
commercially viable PEM fuel Cell?
    Answer. The goal of the industry cost shared Fuel Cell Buildings 
Micro-cogeneration programs is to have the necessary critical 
technologies (i.e., fuel processor, bi-polar plates, catalysts, 
membranes), developed and ready to be tested in a prototype 50kw Proton 
Exchange Membrane fuel cell in a light commercial building with 
conversion efficiencies of 36-40 percent, in the year 2002. Projected 
cost of the fuel cell is $2000/kw or less. To accomplish this goal will 
require adequate funding for research and development focused on fuel 
processing of Natural Gas (NG) to develop the reforming techniques for 
extraction of Hydrogen (H) for use in the fuel cell. Catalyst 
development is necessary to make the fuel cell more tolerant of Carbon 
Monoxide (CO) gas, which is poison to the system and which will 
significantly reduce the power density of the fuel cell. Components 
such as membranes, catalysts and bi-polar plates in the cell stack are 
high cost items and will require substantial research and development 
to improve cell stack operation and to lower cost of construction.
    Coordination with the automotive program will be maintained at a 
high level because of the synergistic nature of the two programs and 
the technologies developed can be incorporated into both programs. The 
Fuel Cell Buildings Micro-cogeneration program will provide an 
accelerated early market entry into the commercial building sector for 
the PEM fuel cell leading to the larger residential market, and assist 
the automotive market strategy. This schedule will lead to introduction 
of a prototype ``First Generation'' PEMFC operating in a commercial 
building by the 2004 with a cost target of $1500/kw.
    Question. Will further increases in the program be required to 
achieve this goal?
    Answer. Further funding will be required in this program to achieve 
the ``First Generation'' PEM fuel cell operating in a light commercial 
building by the year 2002, and commercial introduction by the year 
2004. An expected industry cost share for this program is 35 percent to 
50 percent.
                         lighting appliance r&d
    Question. A number of technologies are being pursued in the 
Lighting Appliance R&D program. When does the Department hope to 
complete development of the low power sulfur lamp?
    Answer. The Department is planning to complete research and 
development on the low power sulfur lamp in fiscal year 1999. By that 
time a 100 lumens per watt prototype, operating at less than 100 watts 
will have been successfully tested and will be ready for 
commercialization by the private sector.
    Question. To what extent do near-term lighting technologies (such 
as compact fluorescents) stand to be overtaken and replaced by longer-
term technologies (sulfur lamps, etc.)?
    Answer. Over time, there has always been a mix of lighting 
technologies. New lighting technology has a relatively slow rate of 
penetration--a good estimate is that a superior new technology will 
replace about 50 percent of the older technology in ten years. Hence, 
compact fluorescents are not necessarily restricted by newer sulfur 
technology.
    Question. Are the economics of compact fluorescents dependent on 
long-term use that would be obviated by development of more advanced 
technologies, or are there market niches available to justify a range 
of technologies?
    Answer. Because there are so many different applications or needs 
in lighting, and so many technologies to draw upon, there are always 
large niches available for each technology for a considerable time, 
measured in decades.
                          energy star program
    Question. Does the Department expect the Energy Star Program to 
become self-sustaining at a lower funding level at any time, or will a 
level of support comparable to the fiscal year 1998 budget request 
always be required?
    Answer. The Department does expect the program to become 
increasingly self-sustaining and to require less funding in the future 
than requested in fiscal year 1998. We plan to demonstrate the value of 
a labeling and promotion campaign for high efficiency products through 
retail sales. Our experience so far has shown that retailers and 
utilities are willing to commit significant resources to offset program 
costs.
    When the initiative has reached a critical mass of participants, 
federal involvement and funding requirements will decline as the 
partners pick up the cost of advertising, sales training, point of 
purchase displays, etc. Some federal activity will continue to be 
needed, however, to preserve the integrity and credibility of the 
Energy Star symbol, including collecting and compiling appliance 
efficiency data and designating qualifying models.
    Question. The Department's response to questions submitted last 
year indicate that lighting manufacturers currently make dedicated 
fixtures on specifications of large commercial accounts (hotels, etc.). 
Given that manufacturers are already engaged in production of efficient 
technologies for large commercial accounts, why does the Department 
continue to invest in the volume purchase program for lighting?
    Answer. There's no question that economical high-efficiency 
lighting is available to large commercial accounts. While we are 
pursuing further efficiency improvements for commercial lighting, the 
volume purchases are intended to bring the efficiency of residential 
lighting up to the standard of best practice in the commercial sector. 
One way to do this is by overcoming the perceived shortcomings of 
compact fluorescents as replacements for incandescent lamps, in 
partnership with industries which buy large numbers of lamps and 
fixtures of the varieties that individual consumers buy for their 
homes.
    Volume purchases that lead to increased sales of dedicated compact 
fluorescent light (CFL) fixtures in hotels, multi-family residential 
dwellings and commercial buildings will having a positive impact on 
price, i.e., as more and more fixtures are manufactured, manufacturing 
costs and retail prices decrease. In addition, a residential home-owner 
might be educated about the benefits of CFLs by first having used them 
in a hotel room or office suite.
              status of home energy rating system council
    Question. The Committee has previously expressed concern that the 
Home Energy Rating System being developed by the Department and the 
HERS Council might skew consumers' perception of the actual total 
energy usage of a particular home. What is the status of the HERS 
Council?
    Answer. The HERS Council issued their own set of guidelines in 
1995. They continue to support their guidelines and energy efficiency 
financing without any Department funds.
    Question. How does the Department plan to proceed on this issue in 
fiscal year 1998?
    Answer. The Department continues to analyze options on how to best 
proceed to ensure accurate, clear and concise information gets to 
customers and the financial community.
    Question. Does the Department feel it is possible to develop a 
rating system that will be generally agreeable to the stakeholder 
community?
    Answer. The stakeholders remain deeply divided over the voluntary 
guidelines. The Department continues to consider options that will 
result in meaningful information to consumers and the financial 
community, and also meet stakeholders' concerns. We are working to 
develop a resolution of these issues.
                    lighting and appliance standards
    Question. A $3.6 million increase is requested for Lighting and 
Appliance Standards. As you may know, the development of these 
standards has been a controversial issue for the Department and for 
this subcommittee. How far along is the Department in implementing the 
process improvements that were developed last year?
    Answer. One of the key features of the process improvement was the 
establishment of the Advisory Committee on Appliance Energy Efficiency 
Standards. This Committee was established to provide the Department 
with regular guidance on the implementation of the Process Rule as well 
as on other critical issues that cut across a variety of products. The 
first meeting was held on January 8, 1997, and a number of 
subcommittees were created to deal with some of the following specific 
issues: analytical methods for the determination of energy saving 
forecasting, future electric prices, life-cycle cost, etc.; screening 
and engineering analysis, consumer and utility impact issues; and non 
regulatory approaches. These subcommittees will be making 
recommendations to the Advisory Committees. The Department also 
convened a workshop on manufacturing impacts on March 11-12, 1997. At 
this Workshop, the Department presented a proposed approach and 
methodologies for analyzing the impacts on manufacturers. One of the 
conclusions from the workshop is that each rulemaking will tailor the 
manufacturing impact analysis to the specific product and the plan for 
conducting the analysis will be discussed with stakeholders. In 
addition to the manufacturing impact analysis workshop, the Department 
has held four workshops (clothes washer and ballasts standards, and 
electric motors and water heater test procedures) since the publication 
of the process rule.
    Question. Does the Department feel it has regained the confidence 
of the industries whose products are being subjected to codes and 
standards?
    Answer. The Advisory Committee meeting and the five workshops held 
since the publication of the process rule were generally well attended 
and well received and the Department is committed to continue the 
implementation of the new procedures, including the commitment to 
frequent and early stakeholder consultation.
    Question. What will the increase in Lighting and Appliance 
Standards enable the Department to do that it would not be able to do 
if held to the fiscal year 1997 level?
    Answer. The increase allows for continuation of the new standards 
development process as planned and on schedule: issuance of notice of 
proposed rulemaking (NOPR) for conservation standards for clothes 
washers and water heaters (responsible for 14 percent of residential 
energy use), and final rules to incorporate legislated standards and 
test procedures for plumbing equipment and large electric motors. This 
increase will also provide for the final rule to amend test procedures 
for residential central air conditioners/heat pumps and initiate 
rulemaking for energy conservation standards for these products. 
Without the increase, delays will occur and DOE would lose credibility 
with the stakeholders that have invested in, and contributed to the 
revised rulemaking process.
                   building standards and guidelines
    Question. A $4.9 million increase is requested for Building 
Standards and Guidelines, 3.5 million of which is for Updating State 
Codes and $1.4 million of which is for Voluntary and Federal Energy 
Codes. How many state codes could be updated if funding for this 
activity were held at the fiscal year 1997 level?
    Answer. A total of ten state codes could be updated if funding for 
this activity were held at the fiscal year 1997 level. Additional 
funding will support cost shared incentive grants and will enable the 
Department to develop and implement programs, tailored to specific 
states and user groups, especially those not directly supported during 
fiscal year 1997, to provide a range of materials, including 
information to state officials about code options, promotion of energy 
efficiency benefits to new home buyers and builders, compliance and 
educational materials, advocacy assistance, model legislation or 
regulations, and testimony on technical and administrative matters at 
legislative and administrative hearings.
    Question. In how many additional states will DOE be active if the 
requested increase is granted?
    Answer. The increase in funding will enable the Department to 
assist an additional 15 states in updating and implementing their 
building energy efficiency codes. Representatives from states 
participating in a multi-state working group have all decided that 
there are important benefits to them in adopting upgraded portions of 
the emerging commercial building energy consensus code without waiting 
to the year 2000. These early adopters will not only benefit their 
regions of the country but can also facilitate adoption of the updated 
code by other states in the year 2000 and beyond, through their early 
adoption experience.
    Question. At some point will all state codes be updated, or will 
the Department continue to revisit and help modify the codes ad 
infinitum?
    Answer. The Department is assisting states to strengthen their 
energy code infrastructure, improve their professional and trade energy 
expertise and strengthen their partnerships with producers so that 
states will increasingly be able to routinely update their energy codes 
without Federal assistance.
    At the same time, the Department is working with the building 
industry consensus code organizations to make the model codes easier to 
implement and use, to improve their technical basis, and to incorporate 
new energy efficiency and renewable energy measures that are 
technologically feasible and cost effective. The Council of American 
Building Officials has published an upgraded edition of its Model 
Energy Code twice since 1992 and will do so again in 1998. The American 
Society of Heating, Refrigerating and Air-Conditioning Engineers 
(ASHRAE) and the Illuminating Engineering Society of North America 
(IESNA) are currently in the process of upgrading their building 
industry consensus code, Energy Code for Buildings Except Low-Rise 
Residential Buildings, ASHRAE/IESNA 90.1-1989R. When implemented, it is 
expected to reduce energy use in buildings by 25 percent. It is 
expected to be published in 2001.
                   voluntary and federal energy codes
    Question. What will the increase requested in Voluntary and Federal 
Energy Codes enable the Department to do in fiscal year 1998 that 
wasn't done in fiscal year 1997?
    Answer. In fiscal year 1997, the Department proposed energy 
standards for Federal buildings. In fiscal year 1998, the Department 
will prepare and publish final standards. The increase will permit the 
Department to prepare and distribute materials and information that 
will assist Federal agencies to train their people to implement and 
enforce these improved energy standards. In fiscal year 1998, the 
Department will complete modifications to its Federal residential 
energy standards that address renewable energy benefits and propose 
them for public comment. The increase will permit the development of 
support materials to implement the proposed revisions.
    In fiscal year 1997, the Department has been working with the 
building industry consensus standards organizations to technically 
improve the model codes and to make them easier to implement. In fiscal 
year 1998, that work will continue and the residential improvements of 
the previous three years will be published in the 1998 edition of the 
Model Energy Code. The increased funding will enable the Department to 
make the legislatively required determination as to whether the 
revisions would improve energy efficiency in residential buildings, and 
to make that analysis available to states that wish to consider 
updating their energy codes. Regarding commercial building energy 
codes, in fiscal year 1998, the Department will continue to provide 
analysis supporting resolution of comments received on the second 
public review draft of ASHRAE/IESNA 90.1-1989R. The additional funding 
will support analysis of whether ASHRAE/IESNA 90.1-1989R will save 
energy in commercial buildings, as legislatively required. This 
analysis will be used to support early adopter states.
                   federal energy management program
    Question. The text accompanying the justification for FEMP 
indicates that total energy cost savings from capital improvements in 
place through fiscal year 1996 will be $7.8 billion by 2002 and $15 
billion by 2015. Are these net figures that reflect the cost of the 
capital investments?
    Answer. Yes. However it should be noted that the cumulative $7.8 
billion energy cost savings in fiscal year 2002 represents the savings 
attributable to investments put in place from 1985 through 1995, plus 
cost savings from anticipated new investments from 1996 forward, based 
on full funding of the FEMP budget request. The $15 billion net energy 
cost savings by 2015 reflects both the capital cost of projects and 
estimated cost of private sector funding accessed through energy 
savings performance contracts and utility-based financing, which should 
dominate the investment stream over the fiscal year 1995 to fiscal year 
2005 period. No investments beyond fiscal year 2005 were assumed. These 
cost savings do not include savings attributable to energy efficient 
product procurement practices, energy cost savings achieved through 
improved energy and building systems operations and maintenance, or to 
the improved efficiency of new buildings entering the Federal building 
stock.
    Question. The justification also describes FEMP's increasing 
emphasis on ``Energy Saver'' performance contracts in which other 
agencies order energy savings projects through FEMP personnel, then 
reimburse FEMP once energy savings are realized. Has this system of 
reimbursement been established and demonstrated?
    Answer. Several methods of performing work on a reimbursable or 
revenue-generating basis have been identified by FEMP. Several 
promising methods will require changes in policy and, in some cases, 
require legislation. These include the development of a revolving fund 
for energy-efficiency work and the ability of FEMP to be reimbursed for 
work on a shared-savings basis or reimbursed in years following the 
delivery of services. FEMP has been and will continue to pursue these 
methods as they have significant potential to improve FEMP's ability to 
perform work for other agencies.
    Question. Is the Department confident it has the authority to 
retain and use reimbursements for its own personnel?
    Answer. Although this approach is consistent with the use of 
reimbursable revenue in other agencies, this is one of the issues that 
still needs to be confirmed and resolved before a pilot project can be 
established.
    Question. The Committee is aware that budgeting for energy 
management in other agencies has been erratic, due to both 
Congressionally imposed cuts and Administration budget requests that 
have given such programs a low priority. How does the Department view 
the level of cooperation and financial support it is receiving from 
other agencies?
    Answer. There is both interest and cooperation from Federal 
agencies and they continue to look to FEMP for leadership. Even though 
agency budgets are decreasing, FEMP, as part of its mission will 
continue to help agencies identify alternate financing arrangements. To 
help streamline the contracting process, DOE issued a solicitation for 
a FEMP Energy Saver Performance Contract (Super ESPC) in May 1996. The 
Super ESPC process allows Federal agencies to issue orders off of each 
contract awarded and begin to realize energy cost savings more quickly. 
Each agency will pay the contractor from the savings in the agencies' 
energy expenses. The first Super ESPC for energy efficiency should be 
awarded in the next 60 days and will cover 8 western states and the 
pacific territories and has a contract value of $750 million, and 
delivery orders will be placed up to that amount. Demands on agency 
resources to develop contracts should be reduced by this process, 
allowing agencies to use their valuable and scare resources on other 
priorities. As a result, other agencies are cooperating in the 
establishment of this contracting mechanism and are anxious to see it 
in place across the country. Individual delivery orders will be subject 
to Congressional notification requirements, and agencies placing those 
orders will be responsible for said notifications.
    Question. Does the Department feel other agencies are responding to 
the letter and spirit of EPACT and Executive Order 12902?
    Answer. Yes. Ten agencies, the Department of Agriculture, Defense, 
Energy, the Interior, Justice, Transportation, Veterans Affairs, the 
Federal Emergency Management Agency, General Services Administration, 
and the National Aeronautics and Space Administration have already 
achieved the Energy Policy Act goal of a 10 percent reduction in 
buildings energy use from 1985. In addition, three agencies, the 
Departments of Energy and Justice, and Federal Emergency Management 
Agency have already achieved a 20 percent reduction in buildings energy 
use from 1985. The remaining agencies continue their efforts to reach 
the goals set under EPACT and Executive Order 12902. And, while their 
progress has been slower, they have indicated their willingness to 
strive to reach their goals without taking away from their mission 
requirements and remain within resource constraints.
    Question. Has the Department considered prioritizing allocation of 
FEMP resources to give preference to those agencies that are the most 
willing to devote their own resources to energy savings projects?
    Answer. The Interagency Energy Policy Committee, Interagency Energy 
Management Task Force and FEMP believe that activities leading to the 
broadening and deepening of participation in Federal energy management 
efforts is an essential FEMP role, and is foundational to the long term 
goal of institutionalizing sound energy management practices in the 
Federal government. While FEMP makes all policies, tools, and 
information available without regard for agency cost sharing, it does 
seek to apply its training, SAVEnergy audits, design assistance, and 
partnership facilitation services where agencies are committed to 
implement projects with their own resources or through their own or 
FEMP's alternative financing mechanisms. In general, FEMP applies its 
resources where a particular activity will have the greatest energy and 
cost saving effects. FEMP is committed to and attempts to utilize its 
limited resources in ways that will leverage resources of agencies, 
utilities, manufacturers and energy service companies and result in 
replication of results beyond immediate projects.
    Question. What agencies or Departments have been the most active in 
pursuing energy savings opportunities?
    Answer. The agencies who are most active are the ten agencies who 
have achieved the Energy Policy Act goal of 10 percent reduction in 
buildings energy use from 1985 as well as the three agencies who have 
achieved a 20 percent reduction in buildings energy use from 1985. The 
ten agencies achieving the 10 percent goal are: Departments of 
Agriculture, Defense, Energy, the Interior, Justice, Transportation, 
Veterans Affairs, the Federal Emergency Management Agency, General 
Services Administration, and the National Aeronautics and Space 
Administration. The three agencies attaining the 20 percent goal are: 
Departments of Energy and Justice and the Federal Emergency Management 
Agency. However, recent budget reductions and the elimination of some 
budgets may change these statistics over time.
    Question. Are there certain agencies or departments in which 
notably large opportunities for savings exist, but which have not 
pursued those opportunities for one reason or another?
    Answer. For the most part, agency energy managers recognize and 
actively strive to implement programs and projects which can achieve 
energy savings in their facilities. However, limited resources and 
internal procurement and legal opinions are the major barriers facing 
those agencies which are having difficulty implementing energy 
efficiency measures. FEMP and the Interagency Energy Management Task 
Force continues to work towards overcoming these barriers within those 
agencies and across the Federal Government. The large agencies clearly 
have the most opportunities for savings, and those agencies have been 
aggressively pursuing opportunities, except where funding limitations 
exist. Within agencies there are unique opportunities such as the 
effort now being investigated by the Department of Energy's own 
programs where surplus facilities are reviewed for energy cost 
reduction projects.
    Question. Aside from providing funding for the FEMP program, is 
there anything this Committee can do that would prompt Federal agencies 
to aggressively seek out and implement energy saving projects that 
would produce concrete budgetary savings?
    Answer. As stated earlier, the Department is exploring several 
methods of performing work on a reimbursable or revenue-generating 
basis. Some of these methods will require legislative and policy 
changes. The Department encourages the Committee to work with the 
Department on any required legislation as recommended or proposed by 
the DOE. Planned proposed policy and legislative changes will allow the 
Secretary of Energy to accept funds from agencies assisted by the 
Department in completing privately financed energy savings projects. 
Funds received would only be used for supporting the ongoing burden of 
contract management and for developing additional privately financed 
energy efficiency projects from energy savings performance contracts 
and utility financed projects.
    Question. In response to a question posed by the Committee last 
year, the Department indicated that ``FEMP has considered charging 
agencies for both technical assistance and the development of energy 
savings performance contracts * * * and [is] continuing to examine what 
authorities and mechanisms could be used.'' Has the program pursued 
this option any further? If no, why not?
    Answer. Yes. The Department has already been charging agencies for 
training under the reimbursable work for others program. All training 
reimbursement funds go to the laboratories where the training programs 
are run and are reinvested in improved training quality. However, 
current training charges do not nearly cover the cost of the courses.
    FEMP also continues to assist agencies under the reimbursable Work 
for Others process and has expanded our efforts in this area. Examples 
of reimbursable work for others at national laboratories include:
  --Cost sharing from GSA on improved computer modeling for helping 
        plan lower energy use in new buildings;
  --Reimbursement from several agencies (CIA, NASA, EPA) for help in 
        assessing renewable opportunities nationwide to comply with 
        Executive Order 12902, and selected related feasibility 
        studies; and
  --Reimbursement from the Army and Navy for integrated energy systems 
        analysis at various bases.
    Question. The Committee will likely be unable to fund the entire 
increase requested for FEMP as a whole. Should a smaller increase be 
spread across the various program elements within FEMP on a pro rata 
basis? Or, for instance, should all of a $5 million increase for FEMP 
be devoted to Project Financing?
    Answer. The FEMP budget request reflects an integrated program. 
Reduced funding would impact all program elements since they are 
complimentary. Each $1 million cut in program funding is likely to 
result in lost savings on the order of $40 million, over the life of an 
average project of fifteen years.
    The most important of these is the financing program. This program 
is projected to put in place several streamlined energy savings 
performance contracts which will give agencies the ability to quickly 
use non-Federal funds to save energy and operations expenses. These 
contracts are also the foundation for FEMP to work to establish a 
significant reimbursable revenue stream to enhance the program from 
savings delivered to the agencies in future years. Reductions in 
funding will delay the start of the agency savings from the contracts 
and delay the start of FEMP's additional revenue source to expand the 
program and capture more savings for the agencies. Continued funding at 
the $19.8 million level would only allow a few or these contracts to be 
signed by the end of fiscal year 1998. FEMP would concentrate efforts 
on only establishing those contracts which could provide some coverage 
for energy efficiency for all areas of the country. Any of the 
technology specific contracts which help to install renewable or 
advanced technologies would be delayed until fiscal year 1999 or later. 
In addition, FEMP would only provide the most minimal support to train 
and assist the agencies on how they would use the contracts, 
concentrating instead on getting the remaining contracts signed. This 
would further delay the savings that the agencies would see.
    Should the Committee not fund the full FEMP budget request, FEMP 
asks that it be allowed flexibility in applying its appropriation, 
within the bounds of its program, so as to maximize potential savings 
based on the opportunities present during fiscal year 1998.
                    in-house energy management staff
    Question. The justification indicates that staff from the 
terminated In-House Energy Management program have been transferred to 
FEMP. How many FTE's are attributed to former IHEM staff?
    Answer. There are five FTEs who have been integrated into the FEMP 
programs of Project Financing; Technical Guidance and Assistance; and 
Planning, Reporting and Evaluation from the IHEM program that was 
eliminated by Congress.
    Question. Are personnel costs associated with IHEM staff reflected 
in the Personnel Compensation line in the Program Direction activity?
    Answer. All Federal Energy Management Program staff are included in 
the Personnel Compensation line in the Program Direction activity which 
includes IHEM.
    Question. If so, why does the request for Personnel Compensation go 
down in fiscal year 1998?
    Answer. The request for Personnel Compensation is reduced in the 
fiscal year 1998 budget because we are estimating a need for only 20 
FTEs, a reduction of two from fiscal year 1997. When considering the 
costs of Personnel Compensation, it is important to also consider the 
impact of the costs of Civilian Personnel Benefits since Benefits must 
be paid for activities such as Federal Employee Retirement, 
participation in some types of Thrift Savings, and health insurance 
coverage. The savings from the two FTEs is partially offset by a 4.5 
percent increase to cover a projected cost-of-living increase and for 
other personnel actions such as promotions and expected grade 
increases.
                            industry sector
Industries of the future
    Question. A portion of the technologies and projects being 
supported in the Industries of the Future (specific program) are geared 
to waste reduction and environmental improvements. While these are 
laudable goals, should such projects continue to be a priority in a 
program whose primary purpose is energy efficiency? Is energy 
efficiency the primary goals of the program? Is it the Department's 
view that these projects all contribute to energy savings via waste 
reduction, etc.?
    Answer. Waste reduction is inescapably linked to energy reduction, 
which explains why most of the projects you see are focused on reducing 
environmental and other wastes. In fact, resource efficiency is a 
highly intertwined subject, where wastes and energy are synonymous in 
their growth, or reduction.
    For example, if wastes are reduced in an industrial plant, there is 
less raw material used, less energy used to convert the raw material to 
a finished product, less handling costs to move the waste material 
within the plant, less shipping costs (and energy) to haul the wastes 
away, less costs and energy to dispose of the waste (whether it be 
burial, incineration, or other means of disposal). By having less waste 
as a part of its production, the plant uses and requires less raw 
material, which means that there is less mining (if that is where the 
raw material is derived) and less transportation from the mine to the 
plant. These, too, have energy costs which are thereby reduced.
    The ``life cycle'' costs of all wastes, when summed, are very high 
in terms of total energy potential. This is particularly true in 
``process'' industries represented in the Industries of the Future, 
which typically operate around the clock, year-round. Even a one 
percent reduction in wastes can have a large impact on total resource 
efficiency. We believe, therefore, that projects which reduce wastes 
have a very large impact on energy efficiency in the industrial sector 
of the United States--from production of raw materials to creation of 
final products.
    To ensure that the Department is funding research which contributes 
to the maximum resource/energy efficiency, each project submission is 
rigorously reviewed by experts at the proposal stage, and again at 
various milestones during the research phase. We have a comprehensive 
system to estimate the true savings in energy and waste reduction of 
every project, with review by the Arthur D. Little accounting firm. All 
of the projects have strong energy efficiency gains.
    The Industries of the Future research projects are solid 
investments to increase energy efficiency, improve competitiveness, and 
maintain U.S. leadership in environmental stewardship through efficient 
use of nature's finite resources.
    Question. Funding requested for the different industry groups 
varies by a considerable degree. Are these differences a function of 
how far the individual industries have come in developing technology 
road maps? Are they a function of potential energy savings in each of 
the industries?
    Answer. Yes, the differences in requested funding reflects a 
delicate balance of the potential energy savings and size of each 
industry, historical funding levels for these industries, and the 
industry's commitment to the process of creating their Vision and 
Technology Roadmaps.
                        advanced turbine systems
    Question. The funding request for the Industries of the Future 
(crosscutting) is essentially flat. How much lower is the request for 
industrial Advanced Turbine Systems than the original program plan? 
What will be the impact of funding the ATS program at the request 
level? How much will be required to maintain the program on its current 
schedule?
    Answer. In the Report to Congress Comprehensive Program Plan for 
the Advanced Turbine Systems, the fiscal year 1998 budget was $31.0 
million. The request is $6.35 million below the program plan. For the 
total program:

                                              [Dollars in millions]                                             
----------------------------------------------------------------------------------------------------------------
                                                                    Funding level--                             
                                                        --------------------------------------      Year of     
                                                                                 Plan to           completion   
                                                            Plan to date        completion                      
----------------------------------------------------------------------------------------------------------------
Plan estimate..........................................              $93.3              $75.8               2000
Actual.................................................               75.7              105.0               2002
----------------------------------------------------------------------------------------------------------------


    The program will be extended to 2002 and the near-term opportunity 
for reduced emissions and commercialization in the distributed 
generation and deregulation market will not be realized until after 
2002. Market share would be lost by the industrial manufacturers and 
potentially result in a loss of jobs.

                        [In millions of dollars]

DOE fiscal year 1998 funding...................................... $43.0
Contractor cost-share (60 percent)................................  63.7
DOE fiscal year 1999 funding......................................  37.0
Contractor cost-share (69 percent)................................  93.0
DOE fiscal year 2000 funding......................................  28.5
Contractor cost-share (86 percent)................................ 181.5

    Question. Is it the Department's view that the stretching out of 
the program is justified by a delay in the development of market 
opportunities for this technology?
    Answer. A delay in the program will result in missed market 
opportunities and U.S. market share. Each year, an estimated 2 
gigawatts of new and replacement power production will be required as a 
result of the deregulation of the utilities in the form of distributed 
generation. With deregulation, opportunities for the industrial 
advanced gas turbine exist in the near term (1999/2000) and utilities 
are accelerating their interest in distributed generation or on-site 
generation with industrial scale gas turbines. Approximately 20 states 
are currently addressing deregulation and California made the first 
move proposing all out state-wide retail wheeling beginning with the 
largest industrial electric consumers in 1996 and ending with 
residential customers in 2002. Electric service utilities are under 
increasing pressures to reduce the cost of service and face limitations 
on the existing transmission and distribution system. ATS is recognized 
as an important option for adding supplemental generation capacity on-
site while alleviating the existing transmission and distribution 
limitations.
    Question. Does the Department feel the market for the utility scale 
turbine will develop prior to the market for the industrial scale 
turbine, or the reverse?
    Answer. The Department feels that both markets are significant. In 
the industrial program, the advent of utility deregulation is doubling 
the projected sales of these turbines over the non-deregulated case by 
2005. These industrial turbines will be cost competitive to central 
generation. The timing for the market for the industrial scale mirrors 
the development very well. For example in California, in 2001 all 
generation will compete on an economic basis with no favored status for 
central utility generation. This means that low emission, low cost 
products such as the industrial scale turbine will be in demand for 
distributed generation (local small scale generation) and cogeneration 
applications since this will be the best product on the market. Under 
the current funding profile, the ATS program will have products ready 
by 2002 and will be poised to impact this market. Twelve other states 
have legislation pending. Essentially, the markets for utility and 
industrial gas turbines are following a close timeline. In the Report 
to Congress Comprehensive Program Plan for the Advanced Turbine 
Systems, the engine manufacturers (both utility and industrial) outline 
the best time frame for introduction of both an utility and industrial 
gas turbine. Under the original funding profile, these industrial 
products would be ready in 2000.
                     industrial assessment centers
    Question. The justification indicates that the Department is 
supporting Industrial Assessment Centers. What sort of follow-up is 
performed by these centers to determine how many audits lead to 
installation of energy saving technologies?
    Answer. All centers are required to contact a client firm 6 to 9 
months following their assessment to confirm those recommendations that 
will be implemented. Implementation action during the 2 year period 
following the industrial assessment may be counted, recognizing that 
some recommendations may require capital budget planning.
                            nice \3\ grants
    Question. Are NICE \3\ grants frequently used to demonstrate 
technologies developed in the Industries of the Future program?
    Answer. The NICE \3\ grants are frequently used to demonstrate 
technologies that are directly related to the Industries of the Future 
(IOF.) Since the Industries of the Future focus on pre-competitive 
research, it is not always possible to directly link IOF funded 
research to NICE \3\ grants. However, it is possible to link the 
research areas of the IOF's to the NICE \3\ grants. While the NICE \3\ 
proposals are not limited to the Industries of the Future, the vast 
majority of the projects are directly related to the Industries of the 
Future research areas. Using only grants to the State of California by 
way of example, six of the seven demonstration projects are related to 
previous research areas funded by the Office of Industrial 
Technologies.
    Question. Is any follow-up of NICE \3\ grants performed to 
determine how many demonstrations lead to large-scale implementation of 
particular energy savings technologies?
    Answer. Yes, follow-up is performed on all NICE \3\ grants to 
determine how many demonstrations lead to implementation of particular 
energy savings technologies. When sales have occurred, methodologies to 
measure energy savings are jointly developed by the grantee and NICE 
\3\ and energy savings are calculated for all installations.
    Question. Please provide for the record an example of a NICE \3\ 
grant made during fiscal year 1997.
    Answer. The grants for fiscal year 1997 have not yet been made. 
Awards will be announced in April 1997. An example of a NICE \3\ grant 
made during fiscal year 1996, the most recent year at the present time 
for grant awards, is the Oxy-Fuel Burners for Steel Reheating project. 
The awardees in this example are the Indiana Department of Commerce, 
Energy Division, and Bethlehem Steel Corporation. The goal of the 
project is to successfully demonstrate the use of oxy-fuel burners in a 
slab reheat furnace, to reduce energy consumption by 45 percent and 
NOx emissions by 90 percent for the converted furnace zones.
    Question. What are the differences between the NICE \3\ and Climate 
Wise programs?
    Answer. The NICE \3\ and Climate Wise programs are complementary in 
that they both deal with industries which are either developing or 
trying to locate innovative technologies to solve industrial energy 
efficiency, environmental and cost problems. NICE \3\ emphasizes 
demonstrations of specific innovative technologies while Climate Wise 
establishes partnerships with industry to plan and carry out 
comprehensive energy efficiency and environmental technology solutions 
which emphasize the adoption of technologies to minimize CO2 
emissions. The plans developed with Climate Wise partners often involve 
the implementation of NICE \3\ technologies.
                         policy and management
    Question. At headquarters, Golden and the regional offices, there 
is a continuing decrease in funds for Salaries and Related Expenses and 
an increase in funds for Contractual Services. What is the reason for 
this shift?
    Answer. The increase of $1,570,000 in contractual services at 
headquarters is primarily the result of a realignment of the Working 
Capital Fund (WCF). In fiscal year 1997, the first year of the WCF, the 
amount for the Office of Energy Efficiency and Renewable Energy was 
distributed on a 50-50 ratio for Interior and Related Agencies 
(Interior) and Energy and Water Development programs. In fiscal year 
1998, the split for the WCF reflects a more equitable distribution of 
the funding request since the costs for the WCF are primarily driven by 
the number of staff supported and approximately 77 percent of EE's 
FTE's are in Interior. A total of $1,019,000 of the $1,570,000 increase 
is attributed to this more equitable distribution of the WCF.
    The balance of the increase at headquarters is $551,000 to help 
support crosscutting activities such as the continued development of 
quality metrics and performance measurement activities.
    The $102,000 increase in contractual services for the Regional 
Support Offices (from $3,928,000 in fiscal year 1997 to $4,030,000 in 
fiscal year 1998) is less than 3 percent and is the result of projected 
inflationary increases for rental costs, communications, and utilities.
    The $1,090,000 increase in contractual services for the Golden 
Field Office reflects two principal activities. The first is support 
service landlord activities such as the costs for several contract 
employees to assist with procurement and personnel functions. 
Additionally, the increase supports project monitoring and technical 
and administrative support of program specific functions such as 
National Industrial Competitiveness through Energy, Environment, and 
Economics (NICE \3\).
                 fossil energy research and development
General
    Your testimony (page 8) states that the 5 percent decrease in the 
request for Fossil Energy Research and Development is justified because 
many of the gas and coal-fueled power systems supported by the 
Department are entering their final phase of development.
    Question. Isn't the final stage of development generally the most 
expensive part of the R&D ``pipeline'' that the Department often 
describes?
    Answer. Yes, the final stage of development is generally more 
costly as a technology scales up for eventual market readiness. 
However, it is also true that as development of the technology matures, 
an increasing percentage of the cost participation is sought from 
industry. In addition, generally there are either fewer participants 
selected to enter the final stage, or as, in some cases, a program 
schedule stretch out can be accommodated by a widening of the time 
window of opportunity for market entry due to changes in market 
conditions.
    Question. In light of the funding situation in programs such as 
LEBS, the Advanced Turbine System, molten carbonate fuel cells, and 
solid oxide fuel cells, does the Department still feel that the 
statement in its testimony is accurate?
    Answer. The Department believes that statement in the testimony as 
reflected in the budget request is reasonable considering several 
factors such as the current budget constraints, the need to balance our 
energy portfolio, and the planned structure of these programs.
    Question. Will the Department request decreases or termination of 
these programs in fiscal year 1999 as they get further into the final 
stages of development?
    Answer. The Department at present does not anticipate requesting 
termination of these programs as long as they continue to show good 
progress, as they have thus far, in achieving their objectives.
    Question. The Environmental Protection Agency has provoked 
considerable controversy with the release of its draft rules on 
particulate matter. It seems to me that many of the technologies being 
supported by the Fossil R&D budget will be essential if this country is 
ever to achieve the considerable reductions in particulate matter 
contemplated by the proposed rules. In light of the fact that the 
fiscal year 1998 budget request reduces and stretches out a number of 
key Fossil R&D programs, do you feel the Administration is taking a 
balanced approach to improving air quality?
    Answer. The levels of funding proposed for fiscal year 1998 reflect 
a balancing of the funding of R&D and the need to reduce Federal 
expenditures. Even at the reduced funding level, the program will 
produce important results. The funding levels proposed are deemed to 
achieve an appropriate balance.
    Question. Will reductions in the Fossil R&D budget make it less 
likely that cleaner generation technologies will be available to 
achieve the proposed regulatory targets?
    Answer. The need to achieve reductions in Federal expenditures and 
the large number of competing R&D needs require difficult decisions. 
However, even at the reduced levels of funding proposed, the remaining 
program can make technologies available in a timely manner.
    Question. Is it the Administration's policy to achieve air quality 
goals by reducing support for R&D and emphasizing the use of regulatory 
techniques?
    Answer. No. The proposed reductions in R&D reflect a balancing of 
priorities among many competing R&D needs, while still achieving 
necessary reductions in the levels of Federal spending.
                          advanced clean fuels
    Question. Funds are requested to continue advanced liquefaction 
both in-house and with various contractors such as CAER. What progress 
is being made in this area?
    Answer. Baseline economic studies conducted in the early 1990's 
estimated that liquefaction technologies were competitive with crude at 
about $34 per barrel in greenfield plants. Continued advanced clear 
fuels research and development, such as that to develop improved slurry 
catalysts, and improvements in solvents have the potential to reduce 
cost to the mid-twenties per barrel or less for greenfield plants. In 
addition, coprocessing of coal, resid and wastes to produce a low 
sulfur distillate syncrude for refinery upgrading in facilities 
adjacent or integrated with existing refineries offers the potential to 
reduce these costs to less than $20 per barrel and even lower if 
combined with technology improvements currently under development.
    Question. Are significant further advancements in liquefaction 
technology likely to be achieved without construction of demonstration 
units?
    Answer. Yes, continued progress is being made in advanced 
liquefaction technologies. Continued laboratory and bench scale 
research and development, such as that to develop improved slurry 
catalysts, and improvements in solvents have the potential to reduce 
cost to the mid-twenties per barrel or less for greenfield plants. In 
addition, coprocessing of coal, resid and wastes to produce a low 
sulfur distillate syncrude for refinery upgrading in facilities 
adjacent or integrated with existing refineries offers the potential 
for earlier introduction by reducing the cost of syncrude distillate to 
less than $20 per barrel or lower when combined with technology 
improvements under development. While demonstration of these 
technologies will be required prior to commercial deployment, 
additional laboratory and bench scale progress will further reduce 
cost, increase efficiency, and improve environmental performance, 
shortening the time to deployment.
    Question. Has the Department considered ``shelving'' further 
advanced liquefaction research until oil prices rise to a level likely 
to resurrect interest in the technology?
    Answer. No. The Energy Information Administration in its Annual 
Energy Outlook projects that crude oil could be $21 per barrel in their 
reference case or as high as $28 per barrel in 2015 in 1995 constant 
dollars. The EIA points out that U.S. will be importing over 60 percent 
of its oil supply in 2015. Continued laboratory and bench scale 
research and development have the potential to reduce cost to the mid-
twenties per barrel or less for greenfield plants. In addition, 
coprocessing of coal, resid and wastes to produce a low sulfur 
distillate syncrude for refinery upgrading in facilities adjacent or 
integrated with existing refineries offers the potential for earlier 
introduction by reducing the cost of syncrude distillate to less than 
$20 per barrel or lower when combined with technology improvements 
under development. With continued development these technologies would 
be available for use in this timeframe. If the activity where to be 
``shelved'', it could take ten years or longer to rebuild the technical 
infrastructure and knowledge base after the need was identified.
    Question. Is significant further cost reduction through bench scale 
research likely?
    Answer. Yes, continued bench scale development may reduce cost to 
the mid-twenties per barrel or less for greenfield plants. In addition, 
coprocessing of coal, resid and wastes to produce a low sulfur 
distillate syncrude for refinery upgrading in facilities adjacent or 
integrated with existing refineries offers the potential for earlier 
introduction by reducing the cost of syncrude distillate to less than 
$20 per barrel or lower when combined with technology improvements 
under bench scale development.
    Question. $100,000 is being requested in both Direct and Indirect 
Liquefaction to initiate a pioneer plant feasibility study. When will 
this study be completed?
    Answer. It is envisioned that this study would take about 18 months 
to define the conceptual project, site issues and potential database 
needs.
    Question. Is the study necessary for the Department to evaluate 
whether to proceed with development of a pioneer plant?
    Answer. The primary purpose of this study is to provide a body of 
process information and engineering data which will be used by a strong 
industrial team preferably including end users (refiners, electric 
utilities), technology developers, A&E's, coal companies and interested 
stakeholders as well as DOE to establish the advisability and context 
for entering into a partnership to design, construct and operate 
several pioneer plants which will produce liquid fuels and chemicals.
    Question. Given current budget constraints, is it likely that the 
Department would budget for development of a pilot plant in the 
foreseeable future?
    Answer. It is unlikely that the Federal government would cost-share 
this type of first-of-kind ``pioneer plant'' demonstration under 
current budget constraints. The Office of Fossil Energy is studying 
innovative revenue neutral or revenue positive funding options which 
would spur the possibility of implementing pioneer plant demonstration 
in the next decade. A feasibility study would be performed to provide a 
body of information to the Department and interested potential 
industrial and stakeholders, so that informed decisions could be made 
on the advisability for proceeding with pioneer plant activity.
    Question. In looking at the funds provided in fiscal year 1997 for 
activities in Advanced Research and Environmental Technology (p. 44), 
it appears that all funds for STTR and SBIR were derived from the money 
earmarked for the Consortium for Fossil Fuel Liquefaction Science. Why 
were all SBIR and STTR funds derived from this one activity, as opposed 
to being pro rated across all activities within AR&ET?
    Answer. SBIR and STTR funds are assessed against extramural 
activities (contacts outside of in-house work). The consortium for 
fossil fuel liquefaction is the only activity that is not an in-house 
activity and is therefore subject to the assessment. Also, it is the 
activity with the largest amount of funding, and the funds assessed for 
SBIR and STTR would have the smallest impact.
                 advance clean/efficient power systems
    Question. The ``Mission Supporting Goals and Objectives'' in the 
justification describe the target efficiencies and emissions levels for 
the four major technologies being developed with DOE support. Target 
levels for IGCC seem comparable to those given for the HIPPS and High 
Efficiency PFB programs. Why does the Department continue to fund all 
three technologies, particularly when the more near term LEBS program 
is entering a critical phase with insufficient resources to proceed?
    Answer. LEBS is nearer term, but it does not have the performance 
potential to reach our ultimate program coal of 60 percent generation 
efficiency by 2010. The latter efficiency goal coupled with the 
simultaneous achievement of our environmental and economic goals is 
extremely difficult to attain. Today, IGCC coupled with advanced 
turbines and fuel cells is the front runner, but technology development 
has not progressed to the point where we can judge, with any accuracy, 
what the final winning system will be. A LEBS system could also serve 
as the bottoming cycle for one of these advanced systems, but it is too 
early to judge.
    All of the advanced power technologies are targeted towards 
achieving the highest efficiency and least emissions at the lowest 
possible cost. As such, the performance goals for these technologies 
are very similar. The Department believes that the IGCC, HIPPS, LEBS, 
and PFB technologies show much promise and based on the progress to 
date, merit continued funding. Therefore, the best approach is to 
continue to develop these most promising technologies to afford them 
the opportunity to achieve their full potential for commercialization. 
Additionally, each of these technologies has a different level of 
developmental maturity, technical risk, and time frame for market 
readiness. Their market applications also vary somewhat. IGCC systems, 
for example, are ideally suited for the coproduction of electricity and 
petrochemicals from coal (i.e., a coal refinery application).
    The Department believes that it is in the best interest of the 
nation, utility industry, and customers to have an array of 
technologies from which the power generators may choose in order to 
meet their specific needs. Therefore, the continuation of all these 
technologies is in keeping with our balanced energy portfolio strategy.
    Question. Since several IGCC plants are already operating under the 
auspices of the Clean Coal program, and since the Department's request 
for the China Clean Coal program indicates that IGCC technology is 
being well received in potential markets, does it make sense to 
continue to support development of the other technologies?
    Answer. Yes, continuing support is critical to meeting established 
program goals. The Clean Coal Technology Demonstration Program (CCT) is 
demonstrating the first generation versions of IGCC systems with 
efficiencies in the 42-45 percent range and is establishing an 
industrial base upon which further R&D advances can be achieved. The 
IGCC R&D effort under way is critical to extending the performance of 
these systems into the 60 percent range while reducing emissions to 
less than 1/10 NSPS and simultaneously reducing the cost of electricity 
by at least 10 percent, which would clearly establish our global 
leadership in this area and would provide the technological capability 
to meet a key public need--a clean environment.
    In addition, IGCC technology is being demonstrated within the Clean 
Coal Technology program at or near commercial scale, various technical 
and economic issues must be resolved before commercial acceptance is 
achieved. For example, the technical and economic issues associated 
with hot gas cleanup for particulates and sulfur capture must be 
resolved if the higher efficiencies are to be achieved through the 
integration with the advanced turbines. Effective, reliable and long 
life particulate control devices must be attained as well as effective, 
low cost, and regenerable sorbents for sulfur control. IGCC costs must 
continue to be reduced through design optimization and reduced 
construction costs in order to be competitive in a deregulated utility 
market with low natural gas prices.
    IGCC technology has captured much domestic and international 
attention. However, commercial acceptance of IGCC on coal for utility 
application still depends on acceptable cost and performance targets 
being achieved.
    Question. What advantages does HIPPS technology have over IGCC 
technology?
    Answer. IGCC technology is gasification based. PFB technology is 
fluidized bed combustion based. HIPPS represents a major extension of 
more conventional combustion technology employing ceramic heat 
exchangers and/or advanced furnace designs. It represents an 
alternative design approach for generating power cleanly and at high 
efficiency.
    Question. Would it appeal to a different sector of the market?
    Answer. Both IGCC and HIPPS technologies are aimed primarily at 
utility scale power applications. However, IGCC has the ability to 
utilize a broad range of coals and fuels and the capability to operate 
in a co-processing configuration to produce coal-based liquid fuels and 
other chemical feedstocks and products in addition to generating power. 
It appears that IGCC technology may be commercially available much 
earlier than HIPPS.
    Question. The Department has argued that stretching out certain 
advanced power generation programs (such as turbines) is acceptable 
because market uncertainty resulting from utility deregulation has 
pushed back the ``market window''. Could this mean that the need for 
medium-term technologies being developed with DOE support could be 
lessened, and that emphasis should instead be placed on longer term, 
higher-performance technologies?
    Answer. The coal and gas power systems technology being developed 
today is driven by the long term goals of 60 percent efficiency with 
coal (70 percent with gas) and with emissions more than 90 percent 
below today's modern regulated plant, while reducing the cost of 
electricity. This technology achievement would also cut CO2 
emissions from coal power plants by almost half at no cost to the 
ratepayer. The achievement of this long term goal requires the 
development of technology for turbines, fuel cells, IGCC, and other 
program elements from where it is today to its mid-term goal state and 
eventually to its long term goal--i.e., the mid-term goal is really an 
intermediate milestone on the path to meeting our long term objectives.
    Question. Have recent changes in the anticipated development of 
power generation markets changed DOE's funding priorities in the 
Advanced Clean/Efficient Power Systems program?
    Answer. While U.S. power generators are cutting costs and delaying 
power generation capacity additions, EIA is forecasting 39GW of coal 
based capacity additions/replacements (that is about a $39 billion 
investment or 390 100-MW plants) and over 100 GW (that is about 1,000 
100-MW plants) of gas based additions by 2015. This is still a 
substantial market which will grow even more after 2015. The global 
market remains huge. As a result, we have made some changes in the 
program (such as increased emphasis on initial capital cost reduction 
through technology advances), but our major program goals remain as 
before. The Fossil Energy RD&D program maintains a balanced support for 
a number of technologies in its portfolio. This balanced approach 
reduces the overall risk in achieving the Fossil Energy mission. The 
mix of technologies, their respective development schedules, their 
respective performance potentials and other factors are considered in 
the formulation of our budget request profile.
                      low emission boiler systems
    Question. Information supplied by the Department indicates that the 
funding request for LEBS for fiscal year 1998 would only be sufficient 
to fund one of the three competing technologies. How does the 
Department propose to make a rational, competitive selection of the 
best LEBS proposal in the face of these funding constraints?
    Answer. The process for selecting a developer to continue Phase IV 
of the LEBS program will be to form a Federal team of experts who will 
review and evaluate the Phase II and Phase III results as submitted by 
each of the three contractors. Selection will be based on an evaluation 
of the submissions and arrived at by a ranking grounded on a set of 
technical and other criteria.
    Question. Has the Department attempted to restructure Phase IV of 
the program in a way that might allow performance, as opposed to 
available funding, be the determining factor in the downselection?
    Answer. While we have considered some alternatives, the down-
selection to a single contractor for Phase IV is in keeping with the 
original program concept. Fossil Energy intends to evaluate the three 
submissions for Phase IV based on a comprehensive set of criteria as 
stated above.
                     particulate control/air toxics
    Question. In Advanced Research and Environmental Technology, an 
increase is requested for Fine Particulate Control/Air Toxics while a 
decrease is requested for Super Clean Systems. Will the Department 
terminate support for the B&W Air Toxics Facility in fiscal year 1997 
as indicated in the budget justification?
    Answer. Funding support of the B&W Air Toxics Facility as 
originally planned was completed in fiscal year 1996. Funding support 
for this facility was not included in the fiscal year 1997 
Appropriation, and no funds are being requested for fiscal year 1998.
    Question. Will the increase in Particulate Control/Air Toxics 
simply allow for more contracts to be pursued from the fiscal year 1995 
Mega PRDA, or will it accommodate more costly work being done on the 
same contracts?
    Answer. In fiscal year 1998 the MEGA PRDA contracts reach the end 
of phase 1 at which time the plans are to select a reduced number of 
projects to enter phase 2. Since the phase 2 research will be at a 
somewhat larger scale, the amounts required for each project selected 
will be greater than it was in phase 1.
    Therefore, the requested funding will support a reduced number of 
projects in phase 2, but those supported will likely be funded at 
higher levels than they were in phase 1.
    Question. What would be the impact of maintaining Particulate 
Control/Air Toxics at the fiscal year 1997 level?
    Answer. Funding below the requested level would require reductions 
in technology base research on new methods of measuring and 
characterizing mercury emissions, thereby increasing the risk that 
current inaccurate approaches would be employed by the EPA in setting 
standards. That could lead to significant over-control with very high 
cost implications, since current methods are believed to overestimate 
the emissions which could be subject to control.
    There would also be a reduction in the number of MEGA PRDA projects 
that could be funded, and possibly would require stretchout or reduced 
funding of those that were funded. This would increase the risk that no 
cost-effective technology for reduction of mercury emissions would be 
forthcoming. As of now, there is no cost-effective technology for 
achieving control of mercury.
    Question. How does work being done in both Particulate Control/Air 
Toxics and Super Clean Systems relate to the EPA's proposed rule on 
particulates and ozone?
    Answer. All of this work addresses improving the cost-effectiveness 
of control technologies for all the above emissions. In Super Clean 
Systems, advanced technologies are being developed to further reduce 
SO2 and NOx emissions, which are precursors to 
ambient fine particulate levels. Reduced NOx emissions will 
be required to meet proposed ozone regulations. Hence, all of this work 
is applicable to addressing the need for improved approaches to meeting 
potential future regulatory requirements for reductions of those 
precursor species.
    Question. Why is funding for contracts under Super Clean Systems 
being decreased while those under Air Toxics are being increased?
    Answer. Given the need for reduced levels of Federal expenditures 
and the many competing R&D needs, not all of the activities can be 
fully funded.
    Since there are no acceptable methods for measuring, 
characterizing, or controlling mercury emissions, which are a primary 
focus of attention under the air toxics provisions of the Clean Air 
Act, that activity was assigned a higher level of funding.
              advanced research and technology development
Coal technology export
    Question. $1,047,000 is requested for Coal Technology Export. 
Exactly how will these funds be used?
    Answer. A goal of the Department of Energy's Strategic Plan is to 
enhance energy productivity to strengthen the United States economy and 
improve living standards by promoting programs that will establish the 
United States as a world leader in developing and deploying energy 
technologies and services throughout the world. Fossil Energy will 
achieve this goal by funding coal technology export programs that will:
  --Protect and expand international demand for U.S. coal and U.S. coal 
        technology;
  --Provide technical assistance to foreign governments;
  --Level the playing field for U.S. industry by helping to eliminate 
        economic/political/social barriers to international trade; and
  --Facilitate trade promotion and trade finance.
    Question. Travel costs for DOE personnel on trade missions?
    Answer. Travel costs are usually covered within Fossil Energy's 
Program Direction line item. No Fossil Energy Coal Technology Export 
funds are planned to be used to pay for any travel costs.
    Question. Technical support?
    Answer. Fossil Energy does have a series of Memoranda of 
Understanding and other international agreements where technical 
information is shared between countries. However, none of Fossil 
Energy's international programs provide for ``direct technical 
support'' to a foreign government or industry.
    Question. How do funds expended in this activity relate to 
functions performed and services provided by the Department of 
Commerce, the State Department and other agencies?
    Answer. Fossil Energy's efforts are complementary to and are not 
duplicative of efforts done by other agencies. The work of Fossil 
Energy is focused upon expanding the use of Clean Coal and Advanced 
Power Technologies into world-wide markets. Fossil Energy is a member 
of a number of inter-agency committees (e.g., Trade Promotion 
Coordination Committee--Dept. of Commerce) to ensure that Federal 
agencies are not duplicating efforts and that the most effective use of 
the Federal dollar is realized.
                         bioprocessing of coal
    Question. Funds are requested in fiscal year 1998 to continue work 
on the bioprocessing of coal. Does work in this area have any 
significant relationship to gasoline and diesel desulfurization work 
being performed with support from the Office of Industrial 
Technologies' Petroleum program?
    Answer. At this time, there is no significant relationship between 
work being done on the bioprocessing of coal and research on gasoline 
and diesel desulfurization work supported by the Office of Industrial 
Technologies Petroleum (OITP) program. OITP issued a solicitation in 
January 1997 seeking proposals for the biodesulfurization of gasoline 
(total funding is $800,000). However, there is an ongoing coordination 
effort between FE and OITP regarding the development of coal derived 
diesel fuels employing FE liquefaction processes for OITP diesel engine 
applications.
    The Office of Fossil Energy's bioprocessing program is focused on 
producing inexpensive liquid fuels from coal that can be used in power 
systems, and ethanol that can be used as an additive to gasoline for 
motor vehicles.
                        university coal research
    Question. An increase of approximately $1 million is requested for 
University Coal Research, with a smaller increase requested for HBCUs. 
Will this entire increase be used to fund the Innovative Concepts 
program described in the budget request?
    Answer. No. Only about $500,000--$750,000 will be directed to 
seeking innovative concepts having the potential of making 
revolutionary advances in coal utilization technologies. The rest will 
be used to address key focus areas of high priority in the Fossil 
Energy program, such as NOx control, mercury abatement, and 
CO2.
    Question. Could the program be initiated with a lesser amount of 
funding and grants?
    Answer. The effectiveness of the program would be severely reduced 
with further budget reductions. The program had been supported at about 
$5 million through fiscal year 1995. It was reduced to about $4 million 
in fiscal year 1996, and further reduced by Congress to about $3 
million in fiscal year 1997. So the fiscal year 1998 request is merely 
a partial restoration of the funding needed to adequately address the 
broad spectrum of research and the novel and innovative concepts that 
may spawn this nation's next generation of advanced, cleaner and more 
efficient coal conversion and utilization technologies.
    Question. Can the Department provide some examples of research that 
has been funded in this activity during the last few years that has 
contributed directly to the development of coal power system 
technologies being developed with DOE support?
    Answer. Since the inception of the University Coal Research (UCR) 
Program in 1979, research grants awarded to U.S. Colleges and 
Universities have contributed directly to the development of more 
efficient and environmentally acceptable coal power system 
technologies. Many of these researchers have received patents and 
various citations. The following are just a few examples:
    Researchers at the Virginia Polytechnic Institute developed a coal 
cleaning process that produces a ``super-clean'' coal using microbubble 
flotation. It provided a way to significantly reduce the ash and 
pyritic sulfur in U.S. coals thereby enabling the use of coals that 
were previously discarded as waste because they could not be cleaned 
with conventional technology. Initial development of the process, which 
is now known as the Microcel Process, was supported by the UCR program 
over a period of four years. It is now in commercial use throughout the 
world.
    University of Pittsburgh researchers received a patent for their 
work originating from a UCR Grant in coal liquefaction catalysis. 
Through their research efforts, a method for synthesizing methanol at 
temperatures far below those used in commercial synthesis was 
developed.
    Dr. Sarofim, the recipient of several UCR awards, has contributed 
significantly to the understanding of the mechanism of coal combustion, 
leading to research in reducing the environmental impacts of coal. He 
was recognized for his work in combustion engineering and nitrogen 
oxide chemistry by receiving the 1995 Homer H. Lowry award from the 
Secretary of Energy. This is the highest such award in the area of 
fossil energy by DOE.
    Dr. Donald P. Olah, University of Southern California, won a 
University Coal Research grant to study superacid catalysts for coal 
conversion. He subsequently received the Nobel Prize for his work in 
the creation of these superacids. Dr. Olah's work significantly 
contributed to technologies for producing lead free gasoline and 
numerous industrial processes.
                           internship program
    Question. Why is the Department requesting new funds for an 
internship program that will focus on undergraduates at colleges 
without graduate programs in science and engineering?
    Answer. The Internship subprogram element, which is part of the UCR 
program, provides opportunities for undergraduate science and 
engineering students nationwide to experience a graduate level research 
environment. Students who apply to and are accepted in the program are 
placed at host laboratories across the country for 10-week summer 
internships. Hosts for the students are grant recipients under the UCR 
program. The host provides a research project, space, and materials for 
the intern and the intern's costs (room, board, stipend, and travel) 
are covered by the Internship Program. This provides an opportunity for 
promising undergraduate students to make decisions about entering into 
graduate programs that deal with energy-related research, and 
ultimately work in energy-related fields that promote technology 
development.
    Question. How does this help meet the goals of the Fossil Energy 
Research and Development program?
    Answer. The internship program provides opportunities for 
undergraduates to be exposed to high levels of scientific research 
which may influence their pursuit of graduate education in their areas 
of interest, as applied to Fossil Energy. This program promotes the 
development of U.S. based technical expertise in fossil energy and 
energy-related technologies. The Administration's technology plan of 
February 23, 1993, recognizes this by setting a key goal for the 
Nation, to be a world leader in science, mathematics, and engineering. 
Furthermore, the Performance Agreement between the President of the 
United States and the Secretary of Energy supports the Administration's 
Goals 2000 objective of recapturing U.S. preeminence in science and 
math education.
    Question. Is $5,000 per internship a reasonable price for this 
activity?
    Answer. The intern's costs for room, board, travel, and stipend for 
10 weeks are marginally covered by the $5,000 per student. If these 
funds are not provided, many of our potential hosts will not be able to 
accept interns based upon local costs of living and travel costs. 
Targeted students will not be able to make up the difference in most 
cases.
                minority institutions eligible for funds
    Question. What are the ``other minority institutions'' eligible for 
funds appropriated for the HBCU activity?
    Answer. Beginning in fiscal year 1997 the Office of the Assistant 
Secretary for Fossil Energy expanded the program to include Other 
Minority Institutions. This was requested by Congress in order to be in 
compliance with the Department of Energy Hispanic Outreach Initiative 
Strategic Plan. Eligible OMI organizations must be on the official 
Department of Education--Office of Civil Rights--listing of Minority 
Institutions. There are certain ethnic population requirements of 
school enrollment to be classified as a Minority Institution. 
Institutions that have more than 25 percent Hispanic, Asian, or Native 
American are eligible.
    Question. When did such institutions become eligible for these 
funds?
    Answer. They became eligible in fiscal year 1996, but because of 
confusion over the official definition of what constitutes a minority 
institution, a decision was reached by Fossil Energy management to 
postpone OMI inclusion until fiscal year 1997.
    Question. How many such institutions are there?
    Answer. According to our information there are 360 ``other'' 
minority institutions that fit the definition of minority institutions 
as described in 10 U.S.C. 2323(a)(1)(c) and 20 U.S.C. 1135-d-5(3). This 
definition is used by the Department of Education from which we derived 
our list.
    Question. Given the expansion in eligibility for these funds, is 
there an appreciable difference in the way in which HBCU and University 
Coal Research funds are utilized?
    Answer. Yes, there are several differences in the way the funds are 
utilized which overshadow the similarities of the UCR and HBCU/OMI 
Programs. Those differences include:
  --1. The HBCU/OMI Program includes oil and natural gas, while the UCR 
        program does not.
  --2. The HBCU program covers a broad spectrum of energy-related 
        areas, while the UCR program addresses ``key research focus 
        areas'' that deal with specific coal technology needs, and an 
        ``innovative concepts'' area that takes advantage of research 
        outside of the traditional fossil energy area.
  --3. The UCR Program is open to all Universities/Colleges, while the 
        HBCU/OMI Program is restricted to just those that are actual 
        HBCU or minority institutions.
  --4. A research and technology transfer symposium is held annually in 
        the HBCU/OMI Program that includes more than just technical 
        papers. It is a forum for various DOE sites and offices 
        (national labs, EE, ER, etc.) to showcase opportunities for the 
        HBCU/OMI. It also focuses on the students of the institutions 
        and includes oral presentations and poster presentations by the 
        students.
                              natural gas
    Question. The Department is again requesting funds to initiate 
development of a ``revolutionary/smart drilling system.'' Has the 
Program Research and Development Announcement been issued for this 
program?
    Answer. A solicitation for cooperative agreement proposals for 
``Advanced Drilling Systems'' was issued on December 2, 1996. Proposals 
were received on February 3, 1997.
    Question. If so, what was the response and how many contracts have 
been entered into?
    Answer. The proposals are under technical and cost evaluation at 
this time. Information relative to the number of proposals can't be 
released at this time due to procurement regulations. The solicitation 
provided for multiple awards, however the actual number of awards can't 
be identified at this time due to procurement regulations.
    Question. Does the Department anticipate the same funding profile 
described to the Committee pursuant to last year's hearing?
    Answer. The revised funding profile anticipated for the project is 
as follows: fiscal year 1996--$200,000, fiscal year 1997--$781,000, 
fiscal year 1998--$750,000, and $1,769,000 of outyear funding.
                       coal mine methane program
    Question. The Department has again request funds for a coal mine 
methane program. How would these funds be administered?
    Answer. These funds would be administered through the Federal 
Energy Technology Center (FETC), which has responsibility for 
implementation of the coal mine methane program. The funds would be 
awarded to five contractors selected for Phase II engineering design 
preparation.
    Question. As competitive grants?
    Answer. Ten Phase I awards were made in fiscal year 1995 for 
feasibility studies in response to a competitive solicitation that 
sought proposals for cost-shared demonstrations of alternative ways by 
which recoverable methane released in the course of underground coal 
mining could be economically utilized. Based on FETC assessment of 
these studies, five of the proposers were selected for Phase II 
engineering design preparation.
    Question. How many demonstrations would the requested amount likely 
fund?
    Answer. The requested amount would fund the Phase II Engineering 
Design for the five contractors selected.
    Question. Would the demonstrations be multi-year?
    Answer. The demonstrations would be multi-year. Subject to the 
Phase II results, three demonstrations might possibly be sufficient to 
define the most cost-effective and greatest benefit options for 
commercialization.
    Question. How much time and Federal investment would likely be 
necessary to demonstrate methane recovery to the point where mining 
operations would regularly employ such technology?
    Answer. The time and investment for the methane recovery and 
utilization technologies selected for mine demonstration will likely 
vary for each of the alternatives selected. For any given technology to 
be regularly used in mining operations, we would expect a period of 
about 5 years to be required. Individual mine demonstrations should be 
completed in three years. Adopting successful technology for use in a 
significant share of mining operations would require another 2 years. 
Total additional funds required, including the fiscal year 1998 request 
of $963,000, are estimated to be $4 million. For any given mine 
demonstration project, the industry cost-sharing contribution will be 
greater than the Federal funds required.
                       advanced turbines program
    Question. The Department is requesting $31.4 million for the 
advanced turbines program. If funded at the request level, how long 
would completion of the turbines program be delayed?
    Answer. A delay of up to 2 years would result.
    Question. When would Phase III be completed and a downselection be 
made for Phase IV?
    Answer. The Department anticipates that it will complete Phase III 
in early fiscal year 1998, assuming no unforeseen technical issues or 
other program uncertainties arising that might impact cost and 
schedule.
    Question. What is the estimated Federal cost of Phase IV?
    Answer. Based on the current schedule, the estimated federal cost 
of Phase IV of the program is approximately $155 million.
    Question. How would the stretch-out associated with the budget 
request impact market entry of advanced turbine technologies?
    Answer. The primary impact of the stretch out on market entry would 
be a 2-year delay, possible cost increases due to the increased 
development costs. It is reported that the turbine manufacturers 
believe that it is in the best interest of program cost and U.S. 
competitiveness to maintain the currently planned levels of funding 
given in the Report to Congress, inclusive of additions to the 
Administration's fiscal year 1998 budget request that have been 
identified in recent public testimony. They believe this will achieve 
the lowest total program cost and provide a commercially available, 
U.S. manufactured system to the marketplace earliest, allowing U.S. 
companies to challenge other international competitors for major orders 
which will produce U.S. jobs.
    Question. Is it the Department's view that the ``market window'' 
for this technology has been pushed back, enabling the development 
program to be stretched out?
    Answer. The demand for new generation and uncertainties in the 
market due to the electricity industry restructuring have had some 
effects that could likely widen the domestic ``market window'' for some 
of the technologies planned for market entry during the post-2000 
timeframe. In addition, the advanced turbine development program 
stretch out, as is the case for most of the program in our power 
systems technology portfolio, is necessitated in order to meet budget 
constraints and to maintain a balanced funding for all these promising 
technologies.
    Question. Is the Department considering modifications to the 
program that would prolong Phase III and increase contractor 
participation/risk in Phase IV?
    Answer. The baseline program as reflected in the fiscal year 1998 
budget request assumes a down selection to one developer for Phase IV. 
The Department is also evaluating the feasibility of modifications to 
the program that would continue government participation with both 
contractors. This could allow the DOE to invest government funds in 
only critical areas to reduce industrial risks and achieve the goals of 
the program. Under this scenario, the Phase IV long-term demonstration 
would be completed by the contractors without government participation.
    Question. How would this impact costs in fiscal year 1998?
    Answer. The cost impact in fiscal year 1998 would remain unchanged.
    Question. How much funding would be required in fiscal year 1998 to 
keep the program on schedule?
    Answer. As indicated in our 1994 Report to Congress, $58.6 million 
would be required in fiscal year 1998 to keep the program on schedule.
    Question. Is market entry for utility-scale advanced turbines 
likely to occur at the same time as the industrial-scale turbines being 
developed with Energy Conservation support?
    Answer. Yes; market entry for both utility scale and industrial-
scale advanced turbines is anticipated to occur within the same 
timeframe.
    Question. Can one program accommodate stretch-out better than the 
other?
    Answer. Both programs are of high priority to the Department and 
target different markets. The fiscal year 1998 budget takes into 
account our balance of these programs, along with others in our energy 
portfolio, given the current budget constraints.
                            gas utilization
    Question. In Gas Utilization, the Department is investigating 
technologies that would allow economic delivery of Alaska North Slope 
gas via the Trans-Alaska Pipeline. What is the estimated window of 
opportunity for development and implementation of this technology?
    Answer. A recently completed, detailed study for the Department 
(Economics of North Slope Gas Options, August 1996), placed the period 
of 2009-2016 as the time within which production from existing ANS 
reservoirs would dwindle to the point that continued operating 
viability of the Trans-Alaska Pipeline (TAP) would be jeopardized 
because of low oil throughput. This would mean that supplemental GTL 
liquids, miscible with the crude still being transported, would be 
desirable by 2009. Allowance for a minimum of 2 years of construction 
time and 2 years for permitting, design and early component ordering 
would mean that economical, commercially ready (demonstrated), advanced 
GTL technology should be ready by 2005 or so, to be prudently ready for 
early onset of low flow TAP problems. Thus, advanced GTL process 
development and pre-commercial testing should be done by 2005 so that 
initial commercial implementation on the North Slope could be 
attainable by 2009 to insure that TAP operation is not halted because 
of insufficient liquid throughput.
    A number of factors influence when the critical flow point is 
reached: production from new ANS reservoirs, gains in crude prices, 
improved oil recovery and others factors could act to extend the TAP 
``jeopardy'' time horizon. However, lower than expected reservoir 
recoveries or crude prices, or other events could trigger an earlier 
date than 2009 for pipeline jeopardy.
    Question. How much interest and financial commitment is there from 
companies doing business on the North Slope?
    Answer. Since becoming aware of the North Slope gas option analysis 
undertaken in 1995 and 1996 for the Department by its Idaho National 
Engineering (and Environment) Laboratory (INEL), Arco and BP (the 
principal North Slope oil operators) appear to have increasing interest 
in GTL as a possible option for utilization of North Slope gas now seen 
as essentially unmarketable. This is particularly the case for the 21 
trillion cubic feet (TCF) of recoverable gas at the giant Prudhoe Bay 
reservoir. Produced with the oil, this gas is currently being 
reinjected into the reservoir to maintain reservoir pressure for 
optimum oil recovery. However, with the projected conclusion of 
Prudhoe's oil producing life in 10 or so years, this gas will be ready 
for sale around 2005. The operators were helpful to INEL in reviewing 
an early study draft for factual accuracy, and they also have recently 
agreed to add GTL to their joint study efforts directed to reducing 
investment costs of North Slope gas marketing options.
    Question. Is gas-to-liquids technology likely to be equally 
applicable on the North Slope as in the Gulf of Mexico?
    Answer. It is too early to comfortably suggest gas-to-liquids (GTL) 
technology has equal potential in the Gulf as on the North Slope. Much 
will depend upon how a number of factors will stack up for respective 
companies in specific situations. The highest potential situations 
would be those where gas is totally without a nearby market (North 
Slope) and thus very low value gas. Pipeline access will also be an 
important factor. If such access is not readily available through 
gathering line extension, and if the lack of gas transport means that 
production of the potential flow of associated crude oil is not 
permitted, the producer might well be interested in relatively costly 
GTL simply to obtain the profit from the otherwise locked in oil. Other 
situations will also bear examination, including those that might fit 
market niches, where gas could be converted into `liquefied natural 
gas' (LNG) at a remote Gulf site and barged to shore for use in peak 
gas storage activity. This is why the GTL research program seeks to 
encourage development of a variety of GTL process options, geared to 
both large and modest-scale operations, and development of technologies 
that can be adapted to these specific situations.
    Question. Is it likely to become economical in one location before 
the other?
    Answer. At the current constrained pace of GTL development, and for 
reasons cited earlier, a definitive answer is extremely difficult. 
Given the economics of scale of current GTL technology, despite the 
capital and operating penalties of working in the climatic conditions 
of the North Slope, a best guess at this point in time is that advanced 
GTL technology would show better economics for the North Slope than for 
operations in the Gulf using higher priced gas.
                   status of ceramic membrane project
    Question. What is the status of the ceramic membrane project 
initiated with AMOCO?
    Answer. After several months of negotiations between Amoco and Air 
Products, the firm that allied with Amoco in submitting an unsolicited 
proposal to develop and demonstrate the ceramic membrane technology for 
gas-to-liquids (GTL) application and which was accepted by the 
Department, it became apparent to Department procurement officials that 
the two firms could not consummate a formal agreement to collaborate in 
this work. After due notice by the Department, the proposal acceptance 
was canceled in September 1996. Because the work was deemed important 
and appropriate for the GTL research program, however, a competitive 
solicitation for comparable work was prepared and announced in December 
1996, with a closing date of February 28, 1997. Proposals are currently 
being evaluated with selection tentatively scheduled for Spring 1997.
                  environmental technology development
    Question. A significant increase is requested in Environmental 
Research/Regulatory Impact Analysis for Technology Development. Are 
there specific regulatory requirements that precipitated the requested 
increase?
    Answer. The request for increased funding in Environmental 
Technology Development was not prompted by specific regulations, but by 
the identification of this area as a high priority for the industry and 
the nation. The Department not only has expertise and technology to 
offer to the industry through the national labs and other facilities, 
but the process of developing and applying lower cost environmental 
compliance technologies can lead to a better understanding of 
environmental risks that contributes to better regulatory 
decisionmaking.
    However, in turning to industry to ascertain their technology 
development priorities, the program has found that those priorities are 
driven by regulatory requirements. For example, industry advisors 
recommended that the fiscal year 1997 request for proposals from 
national laboratories-industry collaborations focus on two areas: 
produced water minimization and treatment, and stationary source air 
emissions control, both the subject of recent EPA rulemakings. 
Additional recommended priorities for fiscal year 1998 include risk 
assessment for decision making, treatment and disposal of naturally 
occurring radioactive materials (NORM), and soil remediation, all areas 
that are the subject of ongoing regulatory discussions at the state and 
federal levels.
                               fuel cells
    Question. $32.7 million is requested for the Molten Carbonate 
program. How does the amount requested compare to the amount called for 
in the original molten carbonate cooperative agreements?
    Answer. Original funding estimates in the two molten carbonate 
cooperative agreements show somewhat larger DOE amounts for fiscal year 
1998 than the request for that year (a total for the two agreements is 
$35 million in fiscal year 1998, but the total for fiscal year 1997 in 
the agreements was $55 million, indicating a prior significant 
shortfall). The impact is a slippage in the original schedule by about 
two years.
    Question. How much would be required in fiscal year 1998 to 
complete the program according to the original schedule?
    Answer. The original schedule had a completion date of 2000. The 
amount estimated to be required in fiscal year 1998 toward completing 
the program according to the original schedule is $50 million.
    Question. How much would be required to prevent further slippage?
    Answer. The amount estimated to be required in fiscal year 1998 to 
prevent further slippage beyond 2002 is $32.7 million.
    Question. Is it the Department's position that a delay in the 
molten carbonate program will have minimal impact on the success of the 
two contractors due to changing market windows?
    Answer. A delay in the molten carbonate program will have an impact 
of a 2-year delay on the ability of the two contractors to enter the 
market on original planned schedule of 2000. However, the time window 
of market opportunity has widened given the changes in the domestic 
power generation market due to the restructuring of the electricity 
generation industry.
    Question. In response to questions posed by this Committee last 
year, the Department stated that it would be prepared to evaluate the 
results of the three major fuel cell contracts at the end of fiscal 
year 1997, and that it was likely that only two contractors would 
continue full system development in fiscal year 1998. Is this still the 
Department's view?
    Answer. The Department intends to support all three fuel cell 
developers on a stretched out basis. Each of the three fuel cell 
developers is aiming for different power generation applications with 
different technologies. One molten carbonate developer is targeting the 
onsite cogeneration application, the other is focusing on distributed 
generation. The solid oxide fuel cell developer's thrust is a combined 
cycle system with gas turbines for the central station power 
application. All three contractors are making good progress in their 
respective technologies. It is in the best interests of this nation to 
allow all three to build a strong domestic fuel cell industry to 
compete in the international fuel cell market and produce very clean, 
highly efficient energy, to create numerous domestic high value jobs, 
and other economic benefits that fuel cell power systems promise for 
the U.S.
    Question. How much would be required to fully fund one molten 
carbonate contract while continuing to fund only component and stack 
development for the other?
    Answer. Funding required to fully fund one molten carbonate 
contract to develop a commercially ready power system in the year 2002 
would require about $20 million per year. Although the capital cost of 
a fuel cell stack is expected to be about 30 percent to 40 percent of 
the total powerplant cost, this ratio does not apply relative to 
amounts for development funding. The bulk of technology development for 
a fuel cell power system must be focused on the more challenging cell 
and stack issues. Thus, continuing to fund only component and stack 
development for the other contractor is estimated to be about $15 
million per year.
    Question. Does the Department view the technological problems 
experienced at the Santa Clara demonstration plant as significant, or 
as routine and surmountable?
    Answer. The general assessment by all the participants in the Santa 
Clara field test is that the plant operation was successful in spite of 
problems encountered that are unrelated to the fuel cell technology 
itself. All systems operated such that full rated power was produced 
resulting in the largest operating fuel cell power system in the U.S. 
The fundamental problem is easily surmountable and is not an issue in 
the redesign configuration for the next prototype system.
    Question. The Department is requesting $12.8 million for the solid 
oxide fuel cell development program. What would be the impact of this 
funding level on the estimated completion date of the program?
    Answer. The requested funding of $12.4 million for the solid oxide 
fuel cell development is expected to stretch out the development 
schedules for two years and reach a commercially ready power system in 
about 2002.
    Question. What would be required to keep the program on its 
original schedule?
    Answer. Funding level required to keep the program on its original 
schedule is estimated at $20 million.
    Question. The Department of Defense has been involved in the 
commercialization of phosphoric acid fuel cells. Is any money requested 
in DOD's fiscal year 1998 budget for fuel cells?
    Answer. There is no known funding requested in the DOD fiscal year 
1998 budget for a Climate Change rebate program for fuel cell systems.
    Question. If so, is the program limited to phosphoric acid 
technology? Why?
    Answer. It is our understanding that the Climate Change rebate 
program for fuel cells is intended for fuel cell systems that are 
available commercially and is not focused on any specific fuel cell 
technology. Phosphoric Acid Fuel Cell systems happen to be the only 
fuel cell technology being offered commercially at this time, but we 
know of no funding requested in the DOD fiscal year 1998 budget for the 
Climate Change rebate program.
    Question. Would either of the molten carbonate contractors be 
prepared to prepared to participate in this type of buy-down program?
    Answer. Either of the molten carbonate fuel cell contractors might 
be prepared to participate in this type of buy-down program at a later 
time when they are ready to make such commercial offerings.
                        reservoir class program
    Question. Much of the research being performed in the Oil 
Technology program is designed to increase the economic life of 
domestic wells. What progress has been made in this regard?
    Answer. The expected benefits from the Reservoir Class Program are 
proving to be greater than originally projected although the program is 
only 4 years into its 10 year duration. The economic life of wells in 
Utah, Texas, Michigan, Colorado, and Oklahoma have been increased 
through several early successes. Industry participants estimate, based 
on documented production and reservoir modeling, that transfer of the 
technologies demonstrated in 32 projects will provide an additional 500 
million barrels of domestic production. Thus far, over 43 million 
barrels in increased reserves have been achieved through initial 
technology transfer.
    Question. Have we slowed the rate at which wells are being shut-in?
    Answer. We have slowed the abandonment rate in the basins where 
these early successes were achieved. It is difficult to assess the 
overall impact we have had on the national abandonment rate because 
this data usually lags production data by 2 years and our program is 
less than half completed.
    Question. $2.1 million is requested to revisit Classes I, II and 
III of the Reservoir Class Program. What have been the benefits of the 
Class program thus far in terms of enhanced domestic oil recovery?
    Answer. Industry participants estimate, based on documented 
production and reservoir modeling, that transfer of the technologies 
demonstrated in 32 projects will provide an additional 500 million 
barrels of domestic production. Thus far, over 43 million barrels in 
increased reserves have been achieved through initial technology 
transfer.
    Examples of some early successes include:
  --Lomax/Inland Resources' waterflood in the Uinta Basin of Utah, 
        going against conventional wisdom in the region, established 
        viability of waterflooding in the area. During the 44 months of 
        the project, 1.13 million barrels of incremental oil has been 
        produced with tax revenues and royalties totaling $5.9 million. 
        Thirteen new waterflood projects have been initiated by other 
        companies in the region as a direct result of the DOE project, 
        with an anticipated minimum of 31 million barrels of additional 
        oil recoverable, worth $160 million in tax and royalty revenue.
  --Michigan Technological University, teaming with an operator in the 
        Michigan Basin, targeted production from the Dundee Formation 
        in the Crystal Field, one of 137 older fields that are nearing 
        abandonment. The application of horizontal drilling strategies 
        coupled with new computer modeling and analysis methods has 
        resulted in a demonstration well producing at a rate of 100 
        barrels of oil per day (BOPD), 20 times the best conventional 
        well in the field. The successful results have caused 9 new 
        horizontal wells to be permitted for drilling in the Crystal 
        Field and 20-30 additional horizontal wells to be permitted in 
        some of the other fields in the basin. Additional development 
        in the Crystal Field alone is expected to recover 2 million 
        barrels of oil. The redevelopment of other fields is 
        anticipated to produce between 80 to 100 million additional 
        barrels with an anticipated tax revenue of about $210 million. 
        This technology has also been transferred through the Kansas 
        region office of the Petroleum Technology Transfer Council, and 
        operators are in the process of drilling a Kansas horizontal 
        well.
  --Offshore, in the Gulf of Mexico's Outer Continental Shelf, the 
        Lamont-oherty Earth Observatory of Columbia University 
        evaluated the hypothesis that some Gulf Coast reservoirs are 
        ``recharged'' periodically along faults. 4-D seismic technology 
        was used to model subsurface fluid flow and to locate growth 
        faults that may be pathways for oil flowing up from deeper 
        formations. The first well drilled as a result of the 4-D 
        seismic technology initially produced 1,500 BOPD. Federal 
        revenues from this well alone will equal the amount of funding 
        provided by DOE within five years. Also as a result of this 
        project, $400 million in contracts have been signed between 
        Western Geophysical and producers to track reservoir recharge 
        using 4-D seismic.
    Question. What is the estimated increase in production on Federal 
lands attributable to technologies developed in the Class program?
    Answer. The technologies demonstrated in the Class program were 
actually developed by the oil and gas industry. The purpose of the 
Class program is to promote the technology. In an effort to estimate 
the relative ``improvement'' of Federal lands due to the DOE Reservoir 
Class Program, the ``Change Resource Implementation Probability'' 
software was run on the eight Reservoir Class projects found on Federal 
Lands (of the total 29 Reservoir Class projects). The estimated 
increase in production on Federal lands attributable to technologies 
demonstrated in the Class program is almost 300 million barrels of 
domestic production.
    Question. What is the estimated increase in royalties and taxes 
accruing to the Federal government as a result of the increased 
production on Federal lands?
    Answer. The estimated increase in royalties and taxes accruing to 
the Federal government as a result of the increased production on 
Federal lands is 1.3 billion dollars.
    Question. In the Department's view, would this increased production 
have occurred, been delayed, or not occurred in the absence of DOE 
support?
    Answer. The Department believes that these increases in production 
would not have occurred in the absence of DOE support due to the risk 
involved and the availability of financing. An offset operator to 
Lomax/Inland Resources noted that, ``My management would not have 
attempted their waterfloods without seeing the results of the Monument 
Butte flood.''
            national laboratory/industry partnership program
    Question. A $2 million increase is requested for the National 
Laboratory/Industry Partnership program. Can the Department provide 
some examples of technology gains that have been achieved in this 
program in the last year?
    Answer. Prototype devices for five geophysical imaging technologies 
have been completed and are undergoing field trials, and one technology 
has been commercialized. The exploratory well success rate has improved 
to 48 percent for the first 4 months of 1996, and continued 
improvements are expected as new geophysical technologies, including 
those developed by DOE, are adopted by industry.
    The five new data processing and simulation methods projects 
successfully completed interim products. These improvements are 
expected to increase U.S. oil and gas production by 1 million barrels 
of oil equivalent starting in 2001. Accomplishments to date include: 
computer code that provides a three-fold acceleration for parallel 
processing of subsalt seismic data; multiphase fluid simulator for 
underbalanced drilling; publications on prototype computer model to 
predict geopressured reservoirs; prototype data server available on the 
Internet; and synthetic seismic data sets for a subsalt structure and 
an overthrust structure available for industry use in calibrating 
processing systems.
    Question. How many additional projects would be funded by this 
increase?
    Answer. The Industry Review Panels will review ongoing projects to 
determine their progress against stated goals. Early in fiscal year 
1998, a call for new proposals would be issued as older projects are 
completed. With the $2 million increase an additional 5 or 6 new or 
continued projects could be funded.
                           upgrading research
    Question. $900,000 is requested for Upgrading Research, with a 
focus on using biotechnology to remove sulfur and heavy metals from 
crude oil. Is this program coordinated with the biocatalytic 
desulfurization research being performed under the auspices of the 
Office of Industrial Technologies' Petroleum program? If not, why not?
    Answer. Yes. This program is coordinated with the biocatalytic 
desulfurization research being performed under the auspices of the OIT 
Petroleum program. The Fossil Energy program is sponsoring biochemical 
research to prevent the formation of pollution by removing sulfur, 
nitrogen, and heavy metals from heavy crude oil before it is refined. 
The proposed OIT research program will be directed at upgrading 
gasoline by biocatalytically removing sulfur, thereby, satisfying the 
need for cleaner fuels. The OIT program issued a Request For Proposal 
(RFP) which closes the end of March 1997. As evidence to the 
cooperation between the two offices, Fossil Energy scientists have been 
asked to help review the anticipated proposals received in response to 
the RFP and OIT representatives will be attending Fossil Energy's 1997 
Oil Processing program review. The programs are supportive of each 
other and cover the broad spectrum of interest to the industry, i.e., 
economically upgrading heavy crude and producing an ultra low sulfur 
gasoline.
                           program direction
  consolidation of pittsburgh and morgantown energy technology centers
    Question. The fiscal year 1997 Interior and Related Agencies 
Appropriations Act approved the consolidation of the Pittsburgh and 
Morgantown Energy Technology Centers into a single management 
structure. What is the status of the consolidation?
    Answer. While there are a multitude of administrative details 
(e.g., new position descriptions, performance elements and standards) 
to be completed, the consolidation is essentially complete. The final 
organization structure was defined December 2, 1996. The employee 
crosswalk was completed on January 13, 1997, with employees beginning 
to work in the proposed new organizations on February 10, 1997. The 
Organization Change Proposal was approved February 26, 1997, to be 
effective March 2, 1997. All employees have been realigned into the new 
Federal Energy Technology Center organizations; office moves 
consolidating staff are well under way; reviews, revisions, and 
creation of administrative procedures are in process; and senior staff 
has begun development of a FETC strategic plan.
    Question. What plans does the Department have to consolidate 
support services and contracts at the two sites? What savings might be 
realized from such consolidation in fiscal year 1998? Do these savings 
justify the entire reduction in Contract Services, or will there be a 
general reduction in services beyond the reductions attributable to the 
consolidation?
    Answer. The primary site support contractor for the Morgantown 
office is EG&G WASC, Inc. The primary site support contractor for the 
Pittsburgh office is a team comprised of Burns and Roe Services Corp., 
Parsons Power, and SAIC. These organizations submitted, during 
February, an approach to jointly provide support services to the FETC. 
In response, a request to the contractors for a detailed technical and 
cost proposal is being made. The target is to have a joint venture or 
cross-teaming arrangement in place and fully operational for fiscal 
year 1998 operations.
    In addition, other support contract activities presently conducted 
at each site are being studied for combined operations and 
consolidation efficiencies.
    The budget proposed a reduction in contract services and contracts 
of $5.4 million based on preliminary estimates of consolidation savings 
by the field. The current field estimate is that approximately $3 
million in total savings from the consolidation of contract activities 
during fiscal year 1998 can be expected. Once the consolidation process 
is underway additional savings may be identified. Otherwise, reduction 
would be necessary in the types and nature of current services to meet 
the budget target. An analysis of such potential savings has not yet 
been done.
    Question. As part of the fiscal year 1997 appropriations Act, the 
Department was directed to study the integration of the Federal Energy 
Technology Center into the field management reporting structure. What 
is the status of this study? If complete, what did the study conclude? 
How does the Department propose to implement the recommendations of 
this study?
    Answer. A large working group of Departmental field and 
headquarters staff was assembled to initiate the process to conduct 
this study. The decision was made to approach the Appropriations 
Committees about postponing the performing of the required analysis. 
Office of Fossil Energy senior staff consulted with the Committees 
about postponement until the Secretary of Energy assesses overall 
Departmental organizational requirements.
       privatization of national institute of petroleum research
    Question. Last year the Committee also approved the privatization 
of the National Institute of Petroleum Research (NIPER). What is the 
status of the privatization?
    Answer. Privatization of NIPER is on schedule. The M&O contract was 
amended in August 1996 to facilitate privatization. The research 
activities of the M&O contract have been relocated off-site. DOE 
personnel and the programmatic support activities of the M&O contract 
are scheduled to move off-site May 1997. The remaining activity for 
full privatization is the environmental remediation necessary for GSA 
to market the facility. This activity is on schedule to be complete by 
November 1998 at the completion of the M&O contract.
    Question. What is the status of DOE personnel at the Bartlesville 
Project Office?
    Answer. The DOE personnel at the Bartlesville Project Office will 
continue to implement the Oil and Related Environmental Research 
Programs. The Program office is co-locating with the Southwest Power 
Administration in Tulsa, Oklahoma on May 5, 1997. Some personnel will 
relocate to Tulsa and others will commute.
    Question. Is it anticipated that staffing at BPO or its successor 
will remain steady or decline?
    Answer. It is anticipated that staffing at the new office, the 
National Petroleum Technology Office, will remain steady for the near 
future. National Oil Program management activities assigned to the M&O 
contractor will revert to the federal staff in November 1998. This will 
create a need to reevaluate staffing levels.
    Question. How is transition funding for NIPER addressed in the 
budget request?
    Answer. NIPER transition funding is being supported in the research 
and program direction accounts with no specific request being made for 
transition.
                  cooperative research and development
    Question. The Department has requested $1,966,000 each for WRI and 
UNDEERC, plus an additional $1,864,000 for coal research at UNDEERC 
only. Is there any technological reason why the Department has 
requested additional funds specifically for UNDEERC?
    Answer. UNDEERC has excellent R&D capabilities in areas 
particularly important to the Coal Program and the additional funds 
were requested for the Center to carry out Department directed 
projects.
    Question. Given that the Department proposed to terminate the 
Cooperative R&D program two years ago on the basis that funds should 
not be appropriated to specific facilities, how does the Department 
justify the earmark for UNDEERC?
    Answer. Since the Congress has provided funding each year for WRI 
and UNDEERC, it was felt that it would be best to try and direct 
funding for these two centers to the areas of R&D that would be most 
beneficial to DOE. Thus, the language directing the additional funds 
for UNDEERC to be targeted toward projects in the Coal Program selected 
by the Department.
    Question. Does the Department feel that politicizing the 
Cooperative R&D program will increase the quality of the research 
performed in the program?
    Answer. No. Our request was not intended to politicize the 
Cooperative R&D program.
    Question. Is the Department trying to provoke Congress into 
terminating the Cooperative R&D program?
    Answer. The Department does not intend to provoke the Congress into 
terminating the Cooperative R&D program.
                       environmental restoration
    Question. $2.5 million is requested for restoration actions 
associated with the closing of NIPER. What is the total cost remaining 
for such activities?
    Answer. The total remaining cost for restoration actions at NIPER 
is $2.5 million. This amount will allow all restoration requirements to 
be completed that are necessary for the site to be placed with GSA for 
disposal. These activities must, by State and Federal law, be completed 
before DOE is free of responsibility for the site.
    Question. Is it imperative to the privatization of NIPER that the 
funds requested be appropriated?
    Answer. Yes; the funds are essential to bring the site to the point 
where GSA can accept it for disposal.
    Question. What would be the impact of a lower funding level?
    Answer. A major goal of the privatization effort is to realize the 
cost savings of not owning and operating the NIPER site. The facility 
must be environmentally clear before GSA will take it for disposal. The 
requested funds are essential to bring the facility to that point. If 
funds are reduced, the schedule for turning the facility over to GSA 
will slip beyond the November 1998 date schedule for closeout of the 
M&O contract. This will require the M&O to be extended and the overhead 
cost of owning the facility to continue until the requested funds are 
obtained and the necessary work completed.
                    mining research and development
    Question. The budget justification indicates that the Albany 
research center will begin crosscut research to complement Fossil 
Energy R&D objectives. What types of complementary research will be 
performed?
    Answer. The Albany Research Center is developing a program which 
complements the Office of Fossil Energy while retaining current 
customers and identifying potential future customers having needs which 
can be met by the capabilities resident at the Center. The Materials 
Program at Albany will contribute to FE objectives by formulating 
partnerships to determine or develop materials for use in current and 
future power systems. Efforts will focus on research which provides 
data on the performance characteristics of materials being specified, 
on developing cost-effective materials for construction of new and 
enhanced power systems, and for solving potential environmental 
emission problems of such energy producing systems. An emphasis is also 
being placed in Albany's Research Program on resolving near-term 
materials problems associated with the retrofitting of existing coal-
burning powerplants.
    A CRADA was signed with the Wyman-Gordon Company to produce 
specific alloys using the reactive foil bonding fabrication technique 
developed at ALRC. Phase I of the proposed and planned work has been 
completed and discussions have begun with manufacturing personnel from 
Wyman-Gordon to apply this technology to specific high-wear components 
of fossil energy/power generation systems.
    Question. Is work being performed at Albany coordinated with 
activities funded by the Department of Energy's Office of Industrial 
Technologies?
    Answer. The Office of Industrial Technologies in EE offers a 
variety of opportunities for materials-related research. The Albany 
Center is a member of the OIT Laboratory Coordinating Council and 
actively participates in the Industries of the Future Program. The 
research cupola melting studies conducted at Albany are currently part 
of the OIT Metal casting program. Other opportunities for cooperation 
are being actively pursued.
    Question. If not, might there be opportunities for coordination, 
particularly in the area of metal casting?
    Answer. ALRC's research capabilities are aiding other activities in 
DOE. Currently, discussions with the Office of Transportation 
Technologies' (OTT) program manager on advanced automotive materials 
indicates the potential for utilizing light metal (Ti and Al) 
expertise/capabilities at ALRC. The Center is planning to partner with 
OTT through the Northwest Alliance for Transportation Technologies, 
NATT, by leveraging the low-cost Ti program.
    The Center is a cooperator in an EM test program which includes 
Clemson University, Clemson, SC, and AJT Enterprises, of Charleston, 
SC. Albany has conducted a series of melting tests on contaminated 
soils from the Charleston (South Carolina) Naval Shipyard in 
preparation for the subsequent vitrification of these residues in the 
larger pilot-scale vitrification furnace at the Center. The Center also 
provides support to DOE in evaluations of the treat ability of 
contaminated soils at specific, identified sites in the Formerly 
Utilized Sites Remedial Action Program (FUSRAP). Research includes 
mineralogical characterization of soil matrices to determine the nature 
of contamination; conceptual design of potentially effective volume-
reduction strategies with accompanying cost analysis; and technical 
review for DOE of studies of contaminated sites by other contractors.
    Question. How much reimbursable work is currently being performed 
at Albany? In cooperation with what agencies?
    Answer. Albany is currently performing reimbursable work in 
cooperation with the following agencies:
  --1. U.S. Environmental Protection Agency (EPA), Metal Contaminant 
        Speciation for Superfund Site Cleaning Research, $180,000
  --2. U.S. Environmental Protection Agency (EPA), Environmental 
        Technology Initiative (ETI), $774,000
  --3. U.S. Agency for International Development (USAID) Asia 
        Sustainable Energy Initiative, $366,000
  --4. Department of Defense (DOD), U.S. Army and Army Corps. of 
        Engineers, $76,000
  --5. Department of the Interior (DOI), National Park Service, $2,500
    These activities are in various stages of completion. All funding 
amounts, therefore, represent total project funding since inception of 
the agreement.
                         clean coal technology
Repayments
    Question. The tables included in the budget justification indicate 
that significant repayments are being realized from Clean Coal 
Technology projects that are currently in operation. What is the total 
of repayments received through the end of fiscal year 1996?
    Answer. The tables in the budget justification on the Clean Coal 
Technology Program indicate that 15 projects are ``in commercial use'' 
as noted by the asterisk. ``In commercial use'' means that the 
technology has been retained for commercial operations after completion 
of the Cooperation Agreement or the technology has sold commercially or 
the technology is being used commercially during the operational phase 
of the demonstration to produce revenues. The term ``in commercial 
use'' is not the same as repayment. Qualification for repayment from 
those projects which are in ``commercial use'' must follow the terms 
and conditions of the Cooperative Agreements.
    Currently, $385,953 has been repaid to the government from the 
Clean Coal Technology Program. Repayments from most projects will be 
derived from future commercial sales of the technology after completion 
of the demonstration project. The larger and more expensive power 
projects, which are currently in design, construction and operation, 
aren't expected to achieve commercial sales until after 2000.
    Question. What are your estimates of repayments through the end of 
fiscal year 1997 and fiscal year 1998?
    Answer. Significant sales from CCT projects are not anticipated 
until after fiscal year 1998. Estimates for repayment through fiscal 
year 1997 and fiscal year 1998 are expected to be minimal and will 
probably remain at approximately $400,000. Several environment retrofit 
technologies may achieve commercial sales after fiscal year 1998 for 
Clean Air Act compliance. Sales of the large power project technologies 
are not expected until after 2000.
    Question. Milestone decisions on the YORK and PENELEC projects are 
due to be made at the end of May. These decisions have an impact on the 
funding requirements for the Clean Coal Program. Is the Department 
confident that it will be able to meet these target decision dates?
    Answer. Yes; the Department continues to be hopeful that decisions 
on restructuring these projects will be made by the end of May 1997. 
However, any changes among the proposed team members or the proposed 
project sites could cause some delay beyond May.
    Question. Press accounts indicate that the NOXSO project is 
undergoing some difficulty. Given that no decision milestones remain on 
the project, what are the Department's options if the project is 
terminated?
    Answer. If the current difficulties being encountered by the NOXSO 
project cause the industrial participant to withdraw from the project, 
the Department will proceed in the same manner that it has in the case 
of other projects that have encountered similar difficulties. The 
cooperative agreement will be closed out and the funds remaining will 
be returned to the Clean Coal Technology Program for use in 
accomplishing the program's objectives.
    Question. What costs would the Department be able to recover for 
use elsewhere in the program?
    Answer. At the time the industrial participant withdraws from the 
project and steps are taken to close out the cooperative agreement, the 
Department's funds that have not been committed or needed in the close 
out activities will be returned to the Clean Coal Technology Program. 
Additional funds may be recovered during the close out negotiations. 
The amount will be dependent upon the agreements reached in coming to 
some settlement about facilities constructed or commitments made.
              program direction for clean coal technology
    Question. The budget justification indicates that $15,866,000 will 
be required for Clean Coal Technology Program Direction. What have been 
the costs of Program Direction in each of the last 5 fiscal years?
    Answer. The following costs have been incurred for Program 
Direction over the past 5 fiscal years for the Clean Coal Program:

Incurred costs for program direction

                                                                        
Fiscal year:
    1997 (estimate).....................................     $16,000,000
    1996................................................      14,768,416
    1995................................................      17,914,680
    1994................................................      17,445,440
    1993................................................      19,017,348

Question. What are the projected requirements for Program 
  Direction in the next several fiscal years?
Answer. The following are the estimated requirements for Clean 
  Coal Technology Program Direction for the next several fiscal 
  years:

Fiscal year:
    1998................................................     $15,850,000
    1999................................................      14,833,000
    2000................................................      13,112,000

    Question. Is the Department confident that the resources devoted to 
Program Direction are appropriate and comparable to other Fossil 
programs?
    Answer. We believe the estimated Program Direction costs are 
appropriate to support the Clean Coal Technology (CCT) program 
activities which include 40 projects in various stages. The Program 
Direction in budget for CCT is expected to decline in the out years as 
more projects are completed. We will continue to review these 
requirements and update the budget estimates to reflect changing 
program requirements. In comparison to other Fossil programs the CCT 
program direction costs as compared to total program obligations 
represent about four percent in fiscal year 1997 and were among the 
lowest of Fossil Energy programs.
        integrated gasification combined cycle project in china
    Question. The budget includes a $50 million request for a 
technology introduction program in the People's Republic of China. For 
what specific purpose will these funds be used?
    Answer. The funds will be used to reduce the cost differential 
between a U.S. IGCC plant and a less clean, less efficient conventional 
plant. The funds will be used either as a direct buy down of costs or 
to leverage more favorable financing, to compete with foreign 
technology and financing terms.
    Question. Will all funds be used simply to buy down the cost of 
Integrated Gasification Combined Cycle (IGCC) projects to be located in 
China?
    Answer. Yes, funds will be used to offset the increased costs of 
doing the first project for IGCC in China.
    Question. How many individual projects does the Department 
anticipate the $50 million would support?
    Answer. It would support less than 50 percent of the differential 
cost of one project.
    Question. Over what period of time?
    Answer. The funds would be expended over 3 years (1999-2002).
    Question. Will any of the funds be used for research and 
development?
    Answer. A small portion of the fund will be used for coal testing 
and adapting U.S. IGCC technology for the China market.
    Question. While the Committee recognizes that China is a huge 
potential market, why is the proposed program being limited to China?
    Answer. It is being limited to China to best leverage success. The 
requested funding is sufficient to buy down the cost differential for 
only one project. China represents the single largest global market for 
power generation equipment, reportedly planning to add 10-20 GW of 
capacity annually. The U.S. leads the world in coal based IGCC 
technology. Success in penetrating the Chinese market should assure 
continuing sales of U.S. IGCC systems or components.
    Question. Does it not make sense to make some of the funds 
available for use in India or in other key markets so that U.S. 
technologies are more widely distributed?
    Answer. It may, but it would require additional funds. The present 
request is sufficient to buy down the cost deferential for only one 
project.
    Question. Why is the China program focused only on Integrated 
Gasification Combined Cycle (IGCC) technology?
    Answer. This technology has been identified by China as a priority 
for demonstration. Another technology of importance is a large fluid 
bed combustor of 300 MW, but this would require additional funds. In 
the long term, the technology with the largest projected market share 
is IGCC.
    Question. Why shouldn't the program be open to other advanced power 
generation technologies that might be of interest to China?
    Answer. It could be, but this was judged to offer the greatest 
probability of success.
    Question. With at least three CCT-supported IGCC projects slated to 
be operational in fiscal year 1998 and other IGCC plants coming on-line 
in other countries, why is additional $50 million required to make such 
plants palatable to China?
    Answer. There are two reasons: (1) to offset the cost of doing the 
first IGCC in China (estimated difference, based on U.S. experience, 
between first and next plants is $200/kW) and, (2) to allow U.S. 
technology financing package to be competitive with foreign technology.
    Question. At the conclusion of the China program does the 
Department anticipate that the costs of IGCC technology will be reduced 
to the point where the technology will be competitive in developing 
countries such as China?
    Answer. The projections of U.S. industry are that the technology 
would be very competitive at $700/kW and 45 percent efficiency. This 
project would be a major stepping stone in achieving that goal.
    Question. The focus on IGCC in the China program suggests that IGCC 
technology is becoming a ``favorite'' among the advanced power 
generation technologies that are being developed with DOE support. Does 
the China market have specific characteristics that make IGCC the 
obvious technology choice?
    Answer. Yes. China is a coal based economy and the efficiency of 
IGCC is extremely important to resources used and rail transport. Also, 
China needs the products of a multi-generation facility that results 
from IGCC-power, steam, fuel gas, town gas, synthesis gas, hydrogen, 
and ammonia.
    Question. What does the focus on IGCC technology mean for other 
technologies (LEBS, etc.) that might be available in the same market 
window?
    Answer. The introduction of IGCC technology into the Chinese 
marketplace could give it a significant advantage, but it may also help 
in the acceptance of all advanced, clean and efficient technologies 
(such as LEBS and others).
    Question. Should the Department be concentrating more of its 
resources on the IGCC program and less on the other advanced power 
generation programs?
    Answer. The DOE should always maintain a balanced source of 
technology options. There is no universal technology option for all 
situations. Therefore, a suite of technology options should be 
developed.
                    clean coal technology rescission
    Question. The budget proposes a rescission of $153 million and a 
deferral of an additional $133 million in the Clean Coal program. I 
also understand that the emergency supplemental funding request will 
include an additional $10 million rescission from Clean Coal. However, 
information supplied by the Department indicates that completion of 
projects currently underway would leave the program with a $23.8 
million deficit if the proposed rescission were enacted. What 
additional steps does the Department propose to take to ensure that 
ongoing projects can be completed within the budget proposal?
    Answer. The projected $23.8 million deficit assumed that all 
projects would proceed to completion and require all funds as committed 
under the current Cooperative Agreements. At the time of the proposed 
rescission, PENELEC has proposed to the Department to restructure and 
downsize the Warren Station External Fired Combined Cycle (EFCC) 
Project. This would result in a reduction of the Federal commitment for 
that project of nearly $40 million. The proposed rescission amount took 
these savings into account, leaving the Department with the ability to 
complete all remaining projects, barring any major contingencies. The 
Department is working closely with the industrial participants to 
reduce the probability of future cost growths.
    Question. Is the $10 million rescission reportedly included in the 
supplemental request based upon new information that was not available 
during formulation of the fiscal year 1998 budget request?
    Answer. The proposed supplemental $10 million rescission was based 
on a re-evaluation of Program needs after consideration of the 
restructuring of the Warren Station Project and the resulting small 
amount of uncommitted funds made available. The supplemental rescission 
limits the ability of the Department to fund future cost overruns, 
however, the Department is working closely with the industrial 
participants to reduce the probability of future cost overruns.
    Question. The fiscal year 1997 budget requested a rescission of 
$325 million from the Clean Coal program, but Congress approved a more 
conservative rescission of only $123 million. The sum of the rescission 
approved in fiscal year 1997 and the rescission proposed in the fiscal 
year 1998 budget request is only $276 million--substantially less than 
the $325 million proposed in the fiscal year 1997 budget. What has 
changed in the last year that caused the Administration to lower its 
estimate of the total that can safely be rescinded from the program 
while allowing for the completion of ongoing projects?
    Answer. Since the beginning of fiscal year 1997, the Department has 
made one project award and approved the restructuring of several other 
projects that were already under Cooperative Agreements. These actions 
have committed significant funds that otherwise would have been 
available for rescission.
    Question. In light of the $50 million increase in estimated funding 
requirements since last year's request, why should the Committee have 
confidence in the fiscal year 1998 estimate?
    Answer. The proposed rescission in the fiscal year 1998 budget 
request represents surplus funds that actually became available in 
fiscal year 1996 and early fiscal year 1997 from approved project 
restructuring and projects that officially ended prior to completion. 
These funds are in surplus of the requirements needed to fully fund 
(excluding large cost increases) the active Cooperative Agreements 
currently in the Clean Coal Technology inventory. The fiscal year 1997 
request was based only on the ``probability'' that projects would be 
restructured or evaluated prior to completion. The proposed deferral of 
funds in the fiscal year 1998 budget request reflects known and 
acknowledged schedule delays in several projects.
                      strategic petroleum reserve
    Question. The Administration has submitted a proposal to rescind 
$11 million from the Strategic Petroleum Reserve account. How has the 
Administration determined that a rescission of this magnitude is 
justified? Is there new information that was not available during the 
fiscal year 1997 appropriations process that might justify the 
rescission?
    Answer. The Strategic Petroleum Reserve is in a transition due to 
two factors. First it is well into its Life Extension Program, which is 
designed to standardize, streamline and simplify the surface facilities 
of the Reserve in addition to extending the useful life expectancy to 
the year 2025. As that program proceeds, it is resulting in cost 
reductions that could only be estimated until the work was actually 
complete, but which we are starting to realize now.
    Second, the Department signed its first agreements to commercialize 
certain facilities that are critical to drawing down the Reserve but 
which otherwise sit idle. One of these facilities, the St. James 
terminal, part of the Capline complex on the Mississippi River, was 
leased to Shell Oil and custody actually transferred. While the signing 
of this contract was foreseen during fiscal year 1997, the timing of 
the actual transfer was highly problematic and the Department planned 
to occupy the facility and perform maintenance and provide security for 
the whole fiscal year. The cost of those functions now transfers to 
Shell under the terms of the lease, and accounts for the bulk of the 
$11 rescission.
    These savings had been anticipated for the whole of fiscal year 
1998, but were not originally projected to reduce the budget for fiscal 
year 1997, and absent the rescission, the funds would not be spent in 
fiscal year 1997.
    Question. What impact would this rescission have on Reserve 
operations, drawdown readiness, Weeks Island decommissioning, life-
extension, etc.?
    Answer. The rescission will have no programmatic impact, the funds 
are available because of savings from activities already completed. All 
of the program areas are progressing at the fastest responsible rate. 
If the money were not rescinded it would not be obligated by the 
Department during fiscal year 1997.
    Question. Does the proposed rescission include the $1.36 million 
remaining from the reserve expansion study, or have these funds already 
been reallocated?
    Answer. The rescission does not include the $1.36 million remaining 
of the appropriation for a Strategic Petroleum Reserve Plan Amendment, 
nor have the funds been reallocated, which would require legislation. 
The Administration has proposed amendments to the Energy Policy and 
Conservation Act, but the Congress has not acted to amend the Section 
159(j) of the Act which requires the Secretary to amend the Strategic 
Petroleum Reserve Plan to prescribe plans for completion of storage of 
one billion barrels of petroleum products in the Reserve. The 
Department plans to request the transfer of the remaining funds 
appropriated for the purpose of preparing the Plan Amendment after the 
Congress acts to remove the legislated requirement for an immediate 
plan amendment.
                  decommissioning of weeks island site
    Question. Decommissioning of the Weeks Island site will be largely 
completed during fiscal year 1998. Does the Department have a high 
degree of confidence that the decommissioning will be completed within 
current cost estimates? Is there any significant chance that DOE will 
carry substantial liabilities beyond fiscal year 1998?
    Answer. We are very confident that the Weeks Island site can be 
emptied, refilled with brine, and decommissioned without any 
extraordinary unplanned cleanup costs, all within the cost estimate. 
However, liability is a legal concept, and the Department cannot 
guarantee that it will not have to defend against claims for actions 
taken in the past or during the decommissioning. The Department shares 
ownership of the salt dome with Morton Salt, and Morton has at times 
asserted that the Government's actions have had negative impacts on 
Morton's interests.
    Question. There are currently 117 million barrels of unused 
capacity in the Reserve. Does the Department have a cohesive policy as 
to the use of this excess capacity? Is it the Department's position 
that the entire excess capacity should be leased to foreign 
governments? If such lease agreements are not forthcoming, does the 
Department plan to simply maintain the capacity in anticipation of 
future acquisitions, or is there a long-term policy for reducing the 
total size of the Reserve?
    Answer. The Department has proposed to lease excess capacity in the 
Strategic Petroleum Reserve to other foreign governments. While the 
Department would like to lease as much of this excess capacity as 
possible, the precise amount of capacity leased will depend on the 
number and nature of the contracts negotiated. The level of capacity 
will also vary depending on specific terms negotiated, such as whether 
commingled or segregated storage is desired.
    If such lease agreements are not forthcoming, the Department plans 
to maintain the capacity in anticipation of future acquisitions. The 
existence of the extra storage capacity will allow the United States to 
quickly start acquiring oil if circumstances dictate that the inventory 
of the Reserve should be increased. If we sell or decommission any of 
the existing sites, creating a new site would be prohibitively 
expensive and would take many years.
    Question. Information supplied to me by the Department indicates 
that by 2010, the number of days for which the SPR inventory could 
displace imports will decline to 44 days in absence of any further oil 
sales. I also understand that current international commitments 
obligate the U.S. to maintain a 90 day reserve capacity, including both 
public and private reserves. Given that U.S. private reserves seem to 
be declining, is there any point in the foreseeable future in which the 
U.S. will not be able to meet the 90 day reserve requirement?
    Answer. If imports continue to expand and private inventories 
continue to decline by a half percent per year, protection will decline 
to 90 days of import protection by the year 2010. A host of events, 
including low oil prices that encourage consumption and discourage 
domestic production, could cause the 90 day threshold to be reached 
before that time. We must also consider that Reserve might be drawn 
down in an emergency, further reducing the inventory and the days of 
protection.
    As a matter of foreign policy we would like to continue to lead the 
International Energy Agency and encourage all member countries and 
applicants to increase their petroleum stocks.
    Question. Does the Department anticipate generating any revenues 
from similar activities in fiscal year 1998?
    Answer. The Department will continue to generate revenues for the 
Federal Government during fiscal year 1998 from the facilities leased 
during 1996 and 1997. Estimated annual lease revenues from the St. 
James Terminal and Bayou Choctaw pipeline will be $1 million based on a 
percentage of the gross revenues generated from its commercial 
operations. In addition, the Department expects lease revenues of 
approximately $500,000 to be received from its lease of the Big Hill 
pipeline.
                 naval petroleum and oil shale reserves
Naval petroleum reserves-1
    Question. I am aware that the Chevron Corporation has filed a 
lawsuit regarding the equity determination for a portion of NPR-1. How 
might this lawsuit affect the schedule for the sale of NPR-1?
    Answer. On March 17, 1997, the U.S. District Court for the Eastern 
District of California entered an order which denied Chevron's motions 
and granted the United States' motion for summary judgment. 
Accordingly, the suit is now dismissed and will not affect the sale 
schedule.
    Question. In the last calendar year, the Appropriations Committees 
have approved two reprogrammings making available over $23 million for 
sale-related activities. This amount far exceeds original estimates of 
sale costs. Is the Department confident that it will be able to execute 
the sale within the amounts already made available for this purpose?
    Answer. The Department has just completed hiring the last set of 
contractors as required by section 3412(d)(1) of the National Defense 
Authorization Act for Fiscal Year 1996. These contractors are five 
independent experts in the valuation of oil and gas fields who will 
conduct separate assessments of the value of the interest of the United 
States in NPR-1. Based on the preliminary cost estimates for these 
contractors, the Department believes that the present level of funding 
authorized to execute the sale should be adequate.
    Question. If the requirements of the Defense Authorization Act are 
not met, or if the sale does not proceed for some other reason, the 
Department will have to operate the field for all of fiscal year 1998. 
Would the Department be able to operate the field for the entire year 
within the amount requested in the President's budget?
    Answer. The amount contained in the President's budget provides for 
operation of NPR-1 for seven and one-half months of the fiscal year, 
through mid-May 1998, and for operation of NPR-3 and the NOSRs for the 
entire fiscal year.
    Question. If not, what is the minimum additional amount necessary 
to operate the field for the remainder of the fiscal year, assuming no 
significant development activities were initiated?
    Answer. The minimum additional amount necessary to operate NPR-1 
through the remainder of fiscal year 1998 is estimated at $34 million. 
This does not include any significant development activities.
    Question. Should the sale not occur, how would Federal revenues be 
affected if no additional funds were made available for the operation 
of NPR-1 for the remainder of fiscal year 1998?
    Answer. If NPR-1 received no additional funds for the remainder of 
fiscal year 1998, it is estimated that operations would close down in 
mid-May of fiscal year 1998. Production and sale of petroleum and 
related products would cease at this time, resulting in a short-term 
revenue loss to the Federal Government estimated at $35 million per 
month for the remainder of the fiscal year. Further, cessation of 
operations at NPR-1 would probably result in reservoir damage, and 
additional production and revenue losses in the future.
    Question. Many different estimates have been made regarding the 
sale value of NPR-1 and the value of the revenue stream from NPR-1 
should the Federal government retain ownership. Many of these estimates 
factor in scoring rules, scoring windows and other budget-related 
arcana. Setting these factors aside, are there any market or 
programmatic reasons why the sale price of NPR-1 would be significantly 
lower than the net present value of the projected revenue stream, 
provided that the sale attracts a number of competitive bids?
    Answer. In compliance with the National Defense Authorization Act 
for Fiscal Year 1996, five independent experts in the valuation of oil 
and gas fields will conduct separate and independent assessments of the 
value of the interest of the United States in Elk Hills. In preparing 
their assessments, these independent experts will consider the net 
present value of the anticipated revenue stream that the Treasury would 
receive if the reserve were not sold, adjusted for any anticipated 
increases in tax revenues that would result if Elk Hills were sold. 
This net present value calculation will be prepared by the Department 
in conjunction with the Office of Management and Budget. The minimum 
acceptable sale price may be set no lower than the average of the five 
independent assessments or the average of three of these assessments 
after excluding the high and low assessments, whichever is higher. This 
process effectively ensures that, in setting the minimum acceptable 
sale price for Elk Hills, the Department will be able to consider six 
separate assessments, including the government's net present value 
calculation, of the future revenues that would have accrued to the 
government from continued operations.
    Question. The budget justification indicates that only development 
activities with a short pay-back time will be undertaken in fiscal year 
1998. If funded at a level higher than the request, are there 
activities that could be performed at NPR-1 prior to the sale date that 
would result in a net ``profit'' to the U.S. Treasury?
    Answer. There are no additional activities (such as drilling or 
facilities work) that could be started, completed and provide a net 
``profit'' to the U.S. Treasury by the February 1998 sale date.
    Question. If so, what are those activities, how much would they 
cost, and how much revenue would they likely produce?
    Answer. The only activity that provides a net ``profit'' in such a 
short time is remedial well work, which is already funded in the fiscal 
year 1998 budget.
   management and administration of naval petroleum reserves 1 and 2
    Question. $20 million is requested for Management and 
Administration at NPR-1 and NPR-2, only $500,000 less than the amount 
appropriated for fiscal year 1997. The request also indicates that $2.2 
million in prior year funds will be available for this activity in 
fiscal year 1998, an increase from fiscal year 1997. Why is the request 
for this activity not reduced to reflect the sale of NPR-1?
    Answer. The request for this activity was reduced to reflect the 
sale and estimated operating time for fiscal year 1998. However, these 
reductions were offset by one-time cost increases for M&O contractor 
severance and contract close-out activity.
    Question. How much does the Department expect to pay for severance 
and other such costs?
    Answer. The fiscal year 1998 budget requests $15.8 million for 
contractor severance costs. Of this amount, $4.6 million is budgeted in 
the Management and Administration activity. The remainder is budgeted 
in Production Operations and Technical Services. Contract close-out 
costs for fiscal year 1998 are budgeted at $4.5 million in the 
Management and Administration activity.
                          development drilling
    Question. $26 million and $17 million were appropriated for 
Development Drilling in fiscal year 1996 and fiscal year 1997, 
respectively. Have these drilling activities been ``profitable'' for 
the Treasury, as expected?
    Answer. The development drilling programs for fiscal year 1996 and 
fiscal year 1997 have been extremely profitable. In fiscal year 1996, 
23 wells were drilled and placed on production. The response of those 
wells has been an increase in production of 5,000 barrels of oil per 
day (BOPD) and 25 million cubic feet of gas per day. On an oil 
equivalency basis, this represents 9,166 barrels of oil equivalent per 
day (BOEPD). Without assigning a value to the gas produced that is not 
sold (most of the gas is used on site for maintaining the pressure in 
the reservoirs), the payout for these 28 wells is 11 months--a very 
successful program.
    For fiscal year 1997, five wells of the 17 planned have been 
drilled and completed as of March 21, 1997, and placed on production. 
Although production testing is currently in progress on these wells, 
the current oil production rate is about 970 BOPD (an average 
production rate of 193 BOPD/well). The wells are expected to payout 
within seven months and will be very profitable. The remaining wells in 
fiscal year 1997 development drilling program are also expected to 
payout within a comparable period. The total response of the 17 wells 
planned for fiscal year 1997 is expected to be over 5,000 BOPD and add 
over 11 million barrels of proved reserves. There have been no 
indications that this development drilling program will be anything but 
very profitable for the Treasury.
                         development facilities
    Question. $15.6 million is requested for Development Facilities, a 
large portion of which will be used for the Rule 4701 NOx 
reduction project. Are these funds sufficient to complete the Rule 4701 
project?
    Answer. It is not likely that the $11.4 million budgeted in fiscal 
year 1998 will be needed by NPRC for compliance with Rule 4701.
    In fiscal year 1995, the local air district commenced a formal rule 
making for proposed Rule 4701 to reduce emission levels for 
NOx and CO and to establish a limit for volatile organic 
compounds (VOC). Early versions of the Rule required that all internal 
combustion engines in operation at NPR-1 greater than 50 horsepower 
meet very stringent NOx/CO/VOC emission limits by May 1999. 
Based on preliminary engineering analyses it was determined that given 
the current configuration of the engines (numerous very large engines 
driving ``one of a kind'' compressor units) significant and very 
expensive modifications would be required to meet the proposed emission 
limits. The fiscal year 1998 portion of the work was estimated to be 
$11.4 million, and this figure was included in the NPRC fiscal year 
1998 Facility Development budget.
    Concurrent with engineering analysis, NPRC continued to participate 
actively in the rule making process with the intent of reducing the 
requirements that ultimately would be included in the final Rule. The 
rule making process continued over an approximate 2-year period before 
the Rule was finalized and formally put in place in December 1996. Not 
knowing what the final outcome of the rulemaking would be, NPRC 
continued to budget $11.4 million in fiscal year 1998 throughout the 
rule making process to cover what was believed to be the most likely 
rule making outcome: i.e., that NPRC's efforts to reduce requirements 
significantly were not likely to be successful. Upon release of the 
final Rule in December 1996, however, and based on Rule clarifications 
received from the air district on March 17, 1997, Rule requirements 
have been reduced significantly, and the compliance date for NPRC 
deferred until May 2001. On the basis of these recent developments, and 
reduced requirements, NPRC is now of the opinion that the $11.4 million 
budgeted for fiscal year 1998 will most likely not be required to 
comply with Rule 4701. It must be understood, however, that the full 
impact of the Rule is still being analyzed. The next step in the 
compliance process is for NPRC to collaborate with the air district and 
develop a compliance plan that is to be submitted to the district for 
review by December 1997. The district then has 6 months until July 1998 
to approve or disapprove NPRC's plan. It is anticipated, based on 
experience, that during the process of compliance plan development, 
NPRC will be introduced to at least some requirements that to this 
point have not been obvious which would require funding. It is 
considered, however, that any such requirements can be funded with 
funds budgeted for Rule 4701 in the fiscal year 1997 budget.
    Question. Is it necessary to complete this project at NPR-1 prior 
to sale?
    Answer. No. As stated above, the project does not need to be 
completed until May 2001. Assuming the sale is completed in February 
1998, the work on 4701 that NPRC needs to accomplish between now and 
sale completion is to collaborate with the air district and develop a 
compliance plan that reflects a thorough understanding of regulatory 
and engineering requirements. Understanding regulatory requirements 
will require intensive collaboration with the air district. 
Understanding engineering requirements will require data analysis, 
field/pilot tests, engineering studies and evaluations, cost analyses, 
and conception engineering designs. The goal is to have a cost 
effective compliance plan in place for the new owners. The actual 
funding of the implementation plan will fall to the new owners. The new 
owners should have no problem completing the compliance project if the 
sale is completed by or near February 1998, as scheduled.
    Question. What would happen if the project was deferred?
    Answer. With the change in compliance date from May 1999 to May 
2001, together with the reduction in requirements, in effect the 
project has already been deferred. It does not appear that deferring of 
the project will have an adverse effect on NPRC.
    Question. What sanctions would be incurred if the project is not 
completed by the deadline?
    Answer. If an operator willfully does not meet the May 2001 
compliance date, they could be fined up to $25,000 per day per 
violation and jailed for up to one year by the State of California. 
Similar sanctions are in place at the Federal level. Additionally, the 
district could revoke all equipment operating permits, and for each 
piece of equipment (approximately 500 in number) the facility could 
incur similar penalties.
    In addition to the final compliance date of May 2001, there also 
are intermediate milestone date requirements (such as the requirement 
to complete a compliance plan by December 1997), and the same sanctions 
that apply to the final date also apply to intermediate dates.
    Question. Will the requirements of Rule 4701 apply to the purchaser 
of NPR-1 as they apply to DOE?
    Answer. Yes, the requirements of Rule 4701 will apply to the 
purchaser of NPR-1.
     increase for technical services at naval petroleum reserves-3
    Question. A $2 million increase is requested for Technical Services 
at NPR-3. Is the entire increase attributable to activities at the 
Rocky Mountain Oilfield Testing Center?
    Answer. Yes, the entire increase is attributable to the Rocky 
Mountain Oilfield Testing Center, and is based on increased industry 
interest in the test center and a large increase in proposed projects.
    Question. Would a lesser increase simply result in fewer tests or 
cooperative agreements at the facility?
    Answer. If funding for this activity were reduced, it would result 
in the completion of fewer projects.
    Question. If provided, would the budget increase leverage an 
increase in non-Federal cost-sharing at the facility?
    Answer. Yes, since all projects performed at the test center are 
cost shared, the increase requested will increase private industry 
cost-sharing.
    Question. It appears that savings achieved at NPR-3 through 
operational and management efficiencies are being funneled into the 
Rocky Mountain Oilfield Testing Center, resulting in a flat 
appropriation request for NPR-3. Are there Development Facilities or 
Development Drilling activities that could be performed with these 
funds that would generate a net return to the Treasury over a 
relatively short time period?
    Answer. Analyses of proposed facility and drilling projects 
indicate that none of the projects would generate a net positive return 
to the Treasury in a relatively short time period.
    Question. If so, why were funds not requested for such activities?
    Answer. Funds were not requested for these activities because 
technical analyses have not identified any projects that would provide 
a reasonable degree of profitability.
    Question. Why is RMOTC a higher priority?
    Answer. RMOTC appears to be a higher priority only because of the 
lack of opportunities for investments in NPR-3 drilling and facilities 
projects. In addition, RMOTC is generating increasing industry interest 
and support, and provides positive benefits through cost-shared 
projects.
            program direction for naval petroleum reserves-1
    Question. Within the amount requested for Program Direction, the 
justification indicates that funds will be used for severance and 
employee transition. Does the Department anticipate that funds will be 
needed in fiscal year 1999 for residual severance costs or similar 
requirements related to NPR-1 personnel?
    Answer. The Department plans to complete all NPR-1 severance and 
employee transition actions in fiscal year 1998, and no funds are 
anticipated to be required for these activities in fiscal year 1999. It 
is expected that funds will be required in fiscal year 1999 to support 
10 NPR-1 employees to work on close-out of the M&O contract and the 
Unit Plan Contract.
    Question. If so, how much will be required and in what account will 
such funds be requested?
    Answer. Funding for NPR-1 employees in fiscal year 1999 will be 
requested in the Program Direction account for NPR-1, however estimates 
of the amount required have not yet been developed.
                          unobligated balances
    Question. The Budget Appendix indicates that a high level of 
unobligated balances will exist in the NPOSR account at the end of 
fiscal year 1998, despite the sale of NPR-1. Is the table in the Budget 
Appendix correct?
    Answer. The table in the Budget Appendix reflects the correct 
number for fiscal year 1996 of $437 million, but is not correct for 
fiscal year 1997 and fiscal year 1998. The correct numbers for fiscal 
year 1997 and fiscal year 1998 are $425 million for each year.
    Question. What is the reason for the large unobligated balance that 
carries forward each year?
    Answer. The large unobligated balance carried forward each year 
reflects program revenues deposited in the NPOSR appropriation account 
as a result of the appropriation law for fiscal year 1992 and fiscal 
year 1993. This law was subsequently changed with passage of the fiscal 
year 1994 appropriation, and all revenues since fiscal year 1994 have 
been deposited in the Miscellaneous Receipts account at the U.S. 
Treasury. The revenues contained in the balances brought forward total 
$424.5 million and are not available to the program for use. It would 
be appropriate for these revenues to be returned to the U.S. Treasury.
    Question. Does the Department anticipate that at the end of fiscal 
year 1998 there will be any prior year balances available to the NPOSR 
program for use in fiscal year 1999?
    Answer. The Department does not expect there will be any prior year 
balances available to the NPOSR program for use in fiscal year 1999.
                                 ______
                                 
                  Questions Submitted by Senator Byrd
              energy supply and the role of fossil energy
    Question. What percentage of the United States energy supply is 
fossil-based?
    Answer. Fossil-based energy comprised 85 percent of total U.S. 
energy supply in 1995.
    Question. Is the picture much different when the global energy 
supply is considered?
    Answer. Fossil-based energy comprised 86 percent of world energy 
supply in 1995.
    Question. Based on the Energy Information Administration's 
projections, is the energy supply mix expected to change?
    Answer. U.S. fossil-based energy is projected to increase from 85 
percent in 1995, to 88 percent of total supply by 2015. World fossil-
based energy consumption is projected to increase 86 percent to 87 
percent between 1993 and 2015.
    Question. When we look specifically at the electricity aspect of 
the energy picture, how much of electricity is derived from fossil 
fuels?
    Answer. Fossil-based electricity generation comprised 68 percent of 
U.S. electricity generation in 1995. Fossil-fuel use accounted for 63 
percent of the world's electricity generation in 1995.
    Question. How much of this is coal?
    Answer. Coal-fired electricity generation comprised 51 percent of 
U.S. generation and 36 percent of global generation in 1995.
    Question. Is the outlook for sources of electricity anticipated to 
change?
    Answer. Total fossil-based electricity is projected to increase to 
80 percent of U.S. generation by 2015. Share of U.S. coal-based 
generation is projected to remain basically flat contributing 50 
percent (including cogenerators) to electricity generation in 2015. 
Globally, the share of fossil use for electricity generation is 
projected to increase slightly to 66 percent in 2015.
    Question. Does any other source of fuel come close to coal in 
meeting our electricity demands?
    Answer. No. The next highest energy source for U.S. electricity 
generation is nuclear which is projected to decline from 20 percent in 
1995 to 10 percent in 2015. Globally, the next highest share is for use 
of renewable energy (including hydroelectric) rising slightly from 22 
percent in 1995 to 23 percent in 2015.
    Question. In light of these types of projections, why is the fossil 
budget proposed to decrease $18.3 million, or 5 percent, in the fiscal 
year 1998 budget?
    Answer. Fossil energy R&D remains a high priority at the Department 
of Energy and an integral part of a portfolio of energy R&D programs to 
ensure a secure energy future under current fiscal constraints. The 
budget, along with available Clean Coal Technology funds, allows 
pursuit of a full range of fossil energy options for the future.
    Question. What impact will the proposed fiscal year 1998 funding 
level for the fossil energy program have on the timely development of 
technologies that will allow for the continued use of fossil fuels in a 
more effective and environmentally-sensitive manner?
    Answer. The Fossil Energy Program continues to be a high priority 
in our overall energy R&D portfolio. We believe that the proposed 
fiscal year 1998 funding is a reasonable level given the current fiscal 
constraints and the need to structure a balanced energy R&D portfolio 
to meet the future energy and environmental challenges. Given the 
current uncertainties resulting from electricity generation industry 
restructuring, it appears that the time window of opportunity is 
widened, thus allowing us to develop these technologies within a time 
frame that can ensure the continued use of fossil fuels more 
effectively and in a more environmentally-sensitive manner.
    Question. If Congress were to fund the energy efficiency budget 
fully, what effect would that have on reducing our use of energy?
    Answer. Estimated primary energy displaced due to DOE energy 
efficiency programs at the requested funding level is projected to be 
0.5 to 0.8 quads in the year 2000 and 4 to 7 quads in 2010. This 
translates into consumer and business energy cost savings of $3.5 to 
$4.3 billion per year in 2000 and $25 to $44 billion per year in 2010.
    Question. Mr. Secretary, there are a number of promising 
technologies under development in the fossil energy program that appear 
to be under funded in fiscal year 1998. The budget seems to walk away 
from commitments and schedules developed for cooperative programs in 
the area of advanced power systems, such as turbines, fuel cells, and 
low emission boiler systems. Yet these technologies, if proven and 
cost- competitive, can contribute to more efficient use of energy in a 
more environmentally sound manner. What effect will the proposed fiscal 
year 1998 budget have on our ability to complete these programs in the 
2000 timeframe?
    Answer. The proposed fiscal year 1998 budget may cause some 
slippages in the original 2000 time frame completion schedule for 
turbines and fuel cells by 2 years and possibly the same for the low 
emission boiler systems. However, we believe that the budget, as 
submitted, represents a reasonable balance among the various 
technologies in our energy portfolio given the current budget 
constraints.
    Question. What are the current forecasts with respect to energy 
demand--is it expected to remain relatively constant, or is it expected 
to grow?
    Answer. Between 1995 and 2015, U.S. energy demand is expected to 
grow one percent per year.
    Question. What are the Department's projections about how we will 
meet the challenge of addressing increased demands for energy?
    Answer. Increasing demand for electricity generation is projected 
to be satisfied primarily through increasing use of natural gas 
followed by increased use of coal and a modest increase in renewable 
energy through 2015. Nuclear electricity generation is projected to 
decline.
    Question. What consequence would program ``stretch-outs'' have on 
our ability to have economically viable alternative power generation 
systems available to respond to projected growths in energy demand?
    Answer. The uncertainty, due to the prospects for deregulation of 
the electricity market, has delayed the incentive for the market to 
deploy new technologies in its generation mix. Therefore, limited 
``stretch-outs'' of deployment of alternative power generation are not 
expected to severely affect the market's ability to respond to 
projected growth in energy demand.
    Question. How realistic is it to assume dramatic shifts in the 
foreseeable future when it comes to our energy picture--both in terms 
of where our energy comes from and how we use it?
    Answer. Current projections of the energy picture does not 
anticipate any dramatic shifts in the mix of energy supply of energy 
use.
                         global climate change
    Question. To what extent do you believe improved technologies being 
pursued as part of the fossil energy program will contribute to the 
more efficient production of energy and improved environmental 
performance in a way that will help our global environment?
    Answer. We believe that the improved technologies being pursued as 
part of the Fossil Energy Program will have a major global contribution 
to more efficient energy production and improved environmental 
performance. The goals of the advanced technologies are to almost 
double the efficiency of current powerplants and to reduce the carbon 
dioxide emission by over 40 percent. The environmental systems 
technologies being pursued are aimed at reducing pollutant emissions by 
up to 90 percent, at a fraction of today's cost. This attractive 
combination can encourage the deployment of these advanced technologies 
in the use of fossil fuels around the world to create a cleaner global 
environment, especially in developing and transitional countries which 
rely heavily on fossil fuels.
    Question. Given that the pressure is to address the global 
environmental debate sooner rather than later, doesn't that argue for 
staying on track in the development of some of these new fossil energy 
technologies so that they can contribute to our having available as 
broad an array of economically viable options to meet our energy needs 
as possible?
    Answer. Given current budgetary constraints, there is a need to 
balance our overall energy portfolio by considering many viable 
options, including fossil energy technologies, to address the global 
climate issue.
    Question. If so, then why should the Committee concur in the 
proposed reductions to the fossil energy budget?
    Answer. We believe that given the current budget constraints, the 
Fossil Energy Program budget submitted to the Committee represents a 
reasonable balance of the overall energy portfolio options.
    Question. Will spending less somehow make these technologies 
available any sooner?
    Answer. No, spending less will not make these technologies 
available any sooner.
    Question. Isn't it true that some of the programs DOE is working on 
in advanced coal fired power generation systems can reduce emissions of 
carbon dioxide by more than 30 percent compared to current baseline 
systems?
    Answer. Yes. Current conventional coal powerplants range in 
efficiencies from less than 30 percent for older plants to 36 percent 
for newer plants. Our portfolio of coal-fired powerplant technologies 
are aiming at efficiencies in excess of 60 percent, thus having the 
potential for reducing carbon dioxide emissions by close to half.
    Question. And in terms of cleaner fuel sources, such as natural 
gas, don't some of the technologies under development--such as advanced 
turbines and fuel cells--have the potential to reduce emissions 30-50 
percent compared to current systems?
    Answer. Yes. Our Advanced Gas Turbine Program and our Fuel Cells 
Program are aimed at developing powerplants with efficiencies in excess 
of 60 percent and when coupled with coal, can have the potential for 
reducing carbon dioxide emissions within that range compared to current 
systems.
    Question. Wouldn't the successful deployment of these technologies 
help further progress towards reducing emissions?
    Answer. Yes, they would in comparison with currently available 
technologies.
    Question. And if so, doesn't it make more sense to address the 
technological issues before considering binding targets?
    Answer. It would be desirable to address the technological issues 
early. However, given the long-range, high risk nature of the 
technology being developed, the 60-percent efficiency goal for coal 
power systems will not be attained any earlier than 2010.
    Question. To what extent are global environmental concerns driven 
not just by the U.S. but also by pollution and emissions elsewhere?
    Answer. Managing emissions outside the United States is critical to 
solving the problem of greenhouse gas emission increases. For example, 
although North America CO2 emissions (in tons of carbon) are 
projected to increase from 1.56 billion tons per year (TPY) in 1990 to 
2.084 billion TPY in 2015, global totals increase from 6.07 billion TPY 
to 9.35 billion TPY over the same period.
    Question. Is it not possible that the successful development of 
alternative technologies, which could then be exported, could 
contribute to the global solution as well as provide job opportunities 
in the U.S.?
    Answer. Yes, it is possible to realize the potential for these 
advanced technologies, if successfully developed and exported, to 
contribute to the global solution, as well as provide opportunities in 
the United States. In fact, these are among the program drivers in the 
development of these technologies.
                         clean coal technology
    Question. The fiscal year 1998 budget proposes some restructuring 
of the funding profile for the Clean Coal Technology program. While I 
am pleased that the Administration has not proposed the huge raids on 
the clean coal program that have been rejected in the past, I still 
have some concerns about the proposal. Is it accurate that the DOE 
budget proposal for fiscal year 1998 assumes a ``savings'' in current 
year budget authority of $286 million from the clean coal technology 
program?
    Answer. The Clean Coal Technology budget proposal for fiscal year 
1998 includes a rescission of $153 million and a deferral of $133 
million until fiscal year 1999. The proposed $153 million rescission 
represents savings made available from approved project restructuring 
and projects that ended prior to completion. The proposed deferral of 
$133 million would not decrease the total value of the Clean Coal 
Technology Program. The combined rescission and deferral represents a 
proposed decrease in budget authority of $286 million for the Clean 
Coal Technology Program in fiscal year 1998 and an increase of $133 
million in budget authority in fiscal year 1999.
    Question. Isn't this somewhat disingenuous in that the 
Administration recognizes that some of these are not true savings from 
clean coal, because the deferral amount will become available right 
away next year?
    Answer. No. The proposed decrease in budget authority for fiscal 
year 1998 represents an earnest effort to be fiscally responsible in 
meeting budget constraints in fiscal year 1998, as well as reducing 
overall Clean Coal Program costs wherever possible. The combined 
rescission and deferral represents a proposed decrease in budget 
authority of $286 million for the Clean Coal Technology Program in 
fiscal year 1998 and an increase of $133 million in budget authority in 
fiscal year 1999. The proposed rescission amount of $153 million 
represents savings made available from approved project restructuring 
and projects that ended which results in a net decrease in overall 
program budget authority and would decrease the total cost of the Clean 
Coal Technology Program. The proposed deferral of $133 million would 
not decrease the total cost of the Clean Coal Technology Program. The 
proposed deferral reflects known and acknowledged schedule delays in 
several projects and does not represent ``true savings'' from the Clean 
Coal Technology Program.
    Question. Is it mere coincidence that the estimated savings from 
the clean coal deferral total nearly the same amount of the proposed 
fiscal year 1998 increase for the energy efficiency program?
     Answer. In the Department's annual budget process, all programs 
are independently reviewed in regard to their resource requirements. As 
a result of the schedule delays in several major Clean Coal projects, a 
deferral of budget authority from fiscal year 1998 to fiscal year 1999 
was proposed. The overall DOE budget for fiscal year 1998 reflects many 
decreases and increases due to various factors including resource 
requirements, schedule and priorities. The overall budget constraints 
require decisions that trade-off savings found in some programs against 
increased requirements in others in order to fund a balanced energy 
portfolio.
    Question. If we were to defer clean coal funding, wouldn't it make 
more sense to not spend any of the artificial savings in fiscal year 
1998 given that the dollars will be required in fiscal year 1999?
    Answer. The overall annual budget constraints for the Department 
require reallocation of resources between programs each year to conduct 
programs in the most efficient manner.
    Question. In addition to the proposed deferral, the budget also 
includes a recommended rescission of $153 million. To date, Congress 
has already rescinded $323 million from the original clean coal program 
appropriation of $2.7 billion. Has DOE been able to identify $323 
million in savings yet? In other words, is there enough funding in the 
clean coal program under current law to complete projects still in the 
pipeline?
    Answer. Under current law, there is a surplus of funds after 
fulfilling all commitments for the remaining projects in the Clean Coal 
Technology Program. Even after the proposed $153 million rescission for 
fiscal year 1998, adequate funds would exist to fully fund all projects 
in the pipeline assuming no major contingencies.
    Question. It is my understanding that a restructuring of the 
PENELEC clean coal project in Pennsylvania must occur if the clean coal 
program is to avoid a deficit under the proposed rescission scenario. 
What is the status of this project and has the necessary restructuring 
(and resulting savings) occurred?
    Answer. Negotiations are continuing with PENELEC to restructure and 
downsize the Warren Station External Fired Combined Cycle (EFCC) 
Project. Additionally, negotiations are continuing with PENELEC to 
restructure and relocate the York Atmospheric Fluidized Bed Combustion 
(AFBC) Project. The projected savings of $40 million are associated 
with the downsized Warren Station EFCC Project and not the York AFBC 
Project. The resulting savings are expected to occur when the 
Cooperative Agreement is officially modified. Even after the proposed 
$153 million rescission for fiscal year 1998, adequate funds would 
exist to fully fund all projects in the pipeline assuming no major 
contingencies.
    Question. When do you expect to know for sure whether the estimated 
savings from PENELEC will accrue?
    Answer. The estimated savings which are based on the Warren Station 
EFCC Project will officially occur when the Department makes a decision 
on the restructured project and officially modifies the Cooperative 
Agreement. The Department expects to make a decision on both of these 
projects and modify the Cooperative Agreements accordingly by early 
summer 1997.
    Question. What is DOE's current level of confidence on the cost 
estimates associated with the clean coal projects currently in the 
pipeline?
    Answer. The Department's confidence level in the remaining Clean 
Coal projects is the same as it has been for all the other projects. 
The cost estimates on all these projects are normally accurate to 
within plus or minus 20 percent in the early design stages, and the 
accuracy increases as the projects progress toward completion. We are 
likely to incur cost increases with the remaining projects, as they are 
large repowering and greenfield projects, which are in the design 
stage. However, as most of the Clean Coal Technology projects are 
either in operation or have ended, the need isn't as great to maintain 
as large a management reserve for cost increases. Please note that each 
Cooperative Agreement states that the government will consider cost 
sharing cost increases subject to available appropriations, but the 
government is under no obligation to fund them.
    Question. Under the proposed rescission, is there any allowance 
being provided for the possibility of cost growth?
    Answer. Yes. The Department has taken into account the anticipated 
savings from restructured projects, the risk of projects not continuing 
to completion, and probable cost increases on other projects in 
arriving at the proposed rescission. The Department believes that 
sufficient funds remain even with the proposed rescission in fiscal 
year 1998 to complete the existing Clean Coal projects.
    Question. Is cost growth something that is common with new 
technologies?
    Answer. Cost growth is common for new technology demonstrations. 
Cost growth was anticipated from the beginning of the program, with the 
Department provided the authority to share in cost growth of up to 25 
percent of the originally awarded federal commitment to a project.
    Question. Has cost growth been experienced on the earlier clean 
coal projects?
    Answer. Of the twenty projects that have concluded operations under 
the Clean Coal Program, only three projects had no cost growth from the 
original Cooperative Agreement amount. Two additional projects had 
minimal cost growth to perform emissions characterization testing that 
was not part of the originally budgeted project. Of the 40 projects 
currently in the Clean Coal inventory, 26 have had some amount of 
federal sharing in cost growth. As of December 31, 1996, the Department 
has approved a total of nearly $120 million in federal funds for cost 
growth in the Clean Coal Program.
    Question. On another clean coal matter, the Administration is 
proposing an advance appropriation of $50 million, to become available 
in fiscal year 1999, to initiate an international clean coal program 
with China. Does the Administration envision that this will be a one-
time requirement, or will there be additional international clean coal 
projects in the future?
    Answer. This will be a one-time requirement.
    Question. What is different about the technology proposed for this 
international initiative from the technologies currently being worked 
on as part of the domestic clean coal initiative?
    Answer. The IGCC technology that would be utilized for this 
initiative must be adapted for the Chinese environment. Adaptations 
would be made to achieve lower capital costs, performance with Chinese 
coals, and lower operating costs. Modifications would also be made to 
the technology to allow for less stringent performance standards than 
those imposed for the U.S. market.
                     advanced clean fuels research
Coal preparation
    Question. The fiscal year 1998 budget proposes to increase funding 
for air toxics by $812,000 in order to finance a down selection from 
three contractors to one in the area of advanced coal cleaning. Why is 
increased funding necessary for a downselection?
    Answer. Increased funding is necessary for a downselection because 
of the larger scale research and development effort now necessary to 
fully investigate the potential of advanced coal cleaning to reduce the 
trace elements that are precursors to potential hazardous air 
pollutants that could be emitted during coal combustion. Research work 
on air toxics (Phase I) has already demonstrated some good results that 
are worthy enough to proceed with obtaining economic, as well as 
technical, information on the technology.
    Question. Does going to one contractor correlate with proceeding to 
a next phase of the air toxics program?
    Answer. Yes, going to one contractor correlates with proceeding to 
Phase II of the air toxics program.
    Question. If so, what will be the next major objective to be 
accomplished by the remaining contractor?
    Answer. The next major objective to be accomplished by the 
remaining contractor is a proof-of-concept demonstration of a coal 
cleaning technology for control of hazardous air pollutant precursors.
    Question. The budget proposes an increase of $140,000 for advanced 
dewatering research to enable the commercial deployment of advanced 
coal cleaning systems already developed. How will the increased funding 
proposed expedite the resolution of problems in this area which have 
impeded commercial development?
    Answer. The budget proposes an increase of $420,000 for advanced 
dewatering research to facilitate greater commercialization of advanced 
dewatering and fine coal cleaning technologies. This increased funding 
will expedite the resolution of problems in this area by supporting the 
formation of a coal preparation or solid fuels consortium that will 
interface with industry and conduct appropriate research related to 
solid fuels processing. The consortium will include academic, industry, 
and government involvement.
    Question. If the technology involved is otherwise commercially 
viable, why is this not an investment that the owner of the technology 
should make?
    Answer. The owner of the technology does not have sufficient 
resources to make the initial investment necessary to fully 
commercialize the technology.
    Question. An increase of $266,000 is proposed to fund new ideas for 
lab scale research. The budget indicates these funds will be used for 
research on solid fuels for advanced combustion systems. What benefit 
would come from this higher funding level?
    Answer. This $266,000 increase is due to increased funding for a 
greater level of effort in advanced dewatering research as discussed in 
previous answers.
    Question. Why is it important to spend money on solid fuels for 
advanced combustion systems?
    Answer. The benefit that will come from the higher funding will be 
greater commercialization of fine coal cleaning technologies. It is 
important to spend money on solid fuels for advanced combustion systems 
because these technologies have the potential to effect significant 
improvements in coal-based power systems, including improved 
efficiency, economics, and environmental performance. Other benefits 
include the potential to develop coal-based fuels of consistent quality 
for new boiler applications, the ability to reduce emissions of acid 
rain and hazardous air pollutant precursors from coal-fired power 
systems, and a reduced dependence on imported oil.
                          direct liquefaction
In-house research and advanced liquefaction
    Question. A reduction of $279,000 is proposed for in-house research 
on advanced liquefaction. This will affect activities at the Pittsburgh 
site. What impact will this funding reduction have?
    Answer. The reduction of $279,000 is proposed in the key activity 
for laboratory and bench scale innovative research which includes FETC 
in-house research. Therefore this reduction will come out of in-house 
innovative research activities which support coprocessing of coal and 
waste and direct liquefaction. This reduction is consistent with the 
redirection of priorities leading to a change in emphasis of activities 
at FETC. The development of liquefaction technologies will proceed on a 
longer schedule while efforts on other activities will be accelerated.
    Question. What activities will be eliminated at the lower funding 
level?
    Answer. $200,000 of this reduction will come out of in-house 
innovative research activities which supports coprocessing of coal and 
waste and direct liquefaction. Therefore, these activities will be 
stretched-out. It is not anticipated that any projects will have to be 
eliminated.
                     coprocessing of coal and waste
    Question. An increase of $595,000 is proposed for coprocessing of 
coal and waste. What is the objective of conducting bench-scale studies 
in this area?
    Answer. Coprocessing of waste products from coal is the most 
promising approach very recently found for greatly reducing the cost of 
liquid fuels from coal (while also eliminating waste products). 
Development of a continuous bench scale database for coprocessing of 
wastes (such as plastics, tires refinery wastes, and mixed solid 
wastes) with coal and petroleum resid technology offers the potential 
for producing a supplementary source of low sulfur liquid distillate 
for refinery upgrading. The distillate crude could compete with 
petroleum crude at $20 per barrel or lower. An important additional 
benefit will be the reduction of landfill required for waste disposal.
    Question. What additional benefits are expected if the funding is 
increased from the current level of $300,000?
    Answer. The bench scale database for the concept would be expanded 
to include municipal solid waste which is primarily paper materials and 
refinery waste materials. This would significantly increase the 
availability of waste materials for production of distillate liquids 
and would also provide additional significant environmental benefits by 
reducing landfill space and providing environmental waste cleanup. This 
database would be available for use in feasibility studies and economic 
evaluation of this coprocessing concept.
    Question. How will this research area contribute to achieving the 
goal of developing economically competitive and environmentally 
acceptable technology for the manufacture of liquid fuels from coal?
    Answer. The development and demonstration of coprocessing of coal 
with resid and waste materials (plastics, tires, refinery wastes, 
municipal solid wastes) technology offers the potential for producing 
low sulfur, premium distillate crude which could compete with petroleum 
crude at $20 per barrel or less. The distillate would be utilized in 
existing refinery facilities. The liquefaction facilities would be 
state-of-art complying with all environmental siting requirements. The 
development and potential demonstration activities which will be 
partnered with industry would be directed to mitigate technical, 
economic and environmental concerns, so that commercialization of these 
technologies could be accomplished by the private sector without 
further government involvement.
    Question. What is different between this research initiative and 
the activities being pursued by the Consortium for Fossil Fuels 
Liquefaction?
    Answer. This research is focused on continuous bench scale 
development to achieve a database which can be utilized in further 
development of the technology leading to engineering scaleup and 
feasibility studies. The Consortium for Fossil Fuels Liquefaction is 
comprised of five universities (University of Kentucky, University of 
Pittsburgh, Auburn University, West Virginia University. University of 
Utah) and is chartered to conduct innovative studies to improve our 
understanding and providing novel approaches to direct liquefaction of 
coal. For the last several years the consortium has been conducting 
innovative laboratory research in the coprocessing of coal and waste 
materials, expanding the database by looking at additional sources of 
waste to be processed. This information is utilized as the basis for 
defining the continuous bench scale tests. The Consortium work and the 
continuous benchscale research is complementary.
                    pioneer plant feasibility study
    Question. The fiscal year 1998 budget proposes $100,000 for a 
``pioneer plant feasibility study''. What is the proposed plant, and 
how is it different from liquefaction technologies that have, as of 
yet, not been cost-competitive?
    Answer. The purpose of the feasibility study is to further define 
the concept, feed materials including coal to be used, database 
requirements and siting issues related to the design of a ``pioneer 
plant'' by an industrial team. The direct liquefaction pioneer plant is 
envisioned to be a small commercial plant to demonstrate technology for 
coprocessing of coal with resid and wastes. It would be built adjacent 
to an existing refinery which would provide the resid for coprocessing, 
the low sulfur distillate crude would be returned to the refinery for 
upgrading to produce refined products, the waste gases produced in the 
liquefaction facility would be processed in the refinery and petcoke 
produced in the refinery could be used to produce hydrogen for the 
liquefaction process. The combing of these activities would 
substantially lower the capital cost of the liquefaction facility.
    The purpose of the first-of-kind ``pioneer plant'' demonstration, 
which would be partnered with an industrial group, would be to answer 
technical, economic and environmental issues so that private sector 
could finance and economically operate these facilities without any 
government involvement.
    The economic analysis based on bench scale data suggests that the 
syncrude distillate from a commercial coprocessing liquefaction plant 
could compete with crude at $20 per barrel or less.
    Question. Who are the partners on this feasibility study?
    Answer. The Federal Energy Technology Center earlier this year 
distributed a Sources Sought Announcement which asked for parties who 
would be interested in participating in feasibility studies to submit 
responses of interest. These responses from interested parties are 
currently being reviewed. The Office of Fossil Energy envisions 
significant participation from the private sector and interested 
stakeholders, such as state and local governments.
    Question. What is the cost-sharing that will be associated with 
this effort?
    Answer. There are no specific project discussions at this juncture. 
The Office of Fossil Energy is interested in substantial cost-share to 
be provided by the industrial and stakeholder partners for this 
activity.
    Question. What is the estimated cost to construct the plant?
    Answer. The specific costs of the pioneer plant will not be known 
until a feasibility study is completed which will define site specific 
aspects and produce the required engineering database. Preliminary 
estimates based on the existing bench scale database suggest that a 
plant to produce 12,000 barrels per day of distillate crude could cost 
in the $350 to $400 million range.
    Question. What would be the Federal share?
    Answer. The funding of the first-of-kind ``pioneer coprocessing 
plant'' would have to be negotiated between the industrial and 
stakeholder partners and the government. The staff of the Office of 
Fossil Energy, is studying innovative approaches to identify possible 
options that may be ways to pay the up-front costs for this ``first-of-
kind'' pioneer plant demonstration. The proposed effort is to conduct a 
cost-shared feasibility study to better define engineering aspects and 
development concepts that could result in a successful project.
                         indirect liquefaction
Air separation membrane development
    Question. In fiscal year 1998, the Department proposes to spend 
$191,000 to initiate development of an ``air separation membrane''. Why 
is development of this product necessary?
    Answer. In indirect coal liquefaction, oxygen or enriched air from 
the air separation plant is used to combust the coal in the gasifier to 
produce synthesis gas which is the precursor for liquid fuels and 
chemicals. Current air separation plants use cryogenic technology which 
is both capital and energy intensive and accounts for a significant 
portion of the product costs for indirect liquefaction. Recent advances 
in membrane R&D have shown its use in air separation offers great 
promise as a cheaper alternative to the conventional cryogenic 
technology. Any liquefaction technological developments that can 
significantly lower the cost of oxygen will result in U.S. technologies 
being more competitive in the global market.
    Question. How is it anticipated to contribute to lowering costs?
    Answer. In the conversion of coal, petroleum coke, biomass, waste 
plastics, and any other carbonaceous material to electricity, fuels, 
and chemicals via gasification, the production of oxygen via 
conventional cryogenic air separation technologies can account for up 
to 25 percent of the total capital cost of the facility. Preliminary 
indications are that the use of ceramic membranes for producing oxygen 
has potential for reducing the cost of oxygen by 35 percent. In a 
current CRADA, the economic impact of this novel technology on the cost 
of fuels and power from IGCC, Indirect Liquefaction, IGCC/indirect 
liquefaction coproduction, and advanced combustion technologies are 
being assessed. If such economic improvements are confirmed, it is 
envisioned that a joint project between the Indirect Liquefaction, 
IGCC, and Advanced Power Systems programs would be initiated to speed 
the development and commercialization of this technology. If 
successful, improvements in efficiency will result in their being 
competitive in the market in the next decade.
    Question. What previous investments in indirect liquefaction are 
failing to realize their potential because of this problem?
    Answer. None. The major thrust of the indirect liquefaction program 
has been to develop a novel liquid phase reactor to convert synthesis 
gas from advanced coal gasifiers to premium fuels and chemicals. The 
accomplishments from this program include the successful proof-of-
concept (POC) scale development of liquid phase methanol technology 
which is now under commercial demonstration at the Eastman Chemicals 
plant in Kingsport, Tennessee with the support from the DOE Clean Coal 
Technology program. The current effort is to extend the know-how in 
this technology to the liquid phase Fischer-Tropsch (F-T) technology 
which is to convert synthesis gas to premium hydrocarbon fuels and 
chemicals. The proposed work on air separation membrane represents a 
new initiative which is to further reduce the costs of indirect liquids 
through a system integration approach.
    Question. What is the estimated total cost to resolve the air 
separation membrane issue?
    Answer. The proposed program would be structured in two phases: 
Phase 1 is laboratory research to validate technical feasibility. The 
federal cost of the phase 1 program is estimated to be $12 million over 
three years, assuming at least 50 percent industrial cost share. In 
addition, due to the applicability of air separation technology to both 
fuel and power systems it is anticipated that federal costs would be 
shared through a joint program in this area. If the proposed effort 
were started in fiscal year 1999, phase I activity would be completed 
around 2002.
            consortium for fossil fuel liquefaction sciences
    Question. A group of six universities, including West Virginia 
University, has been conducting research and investing promising 
technologies for ways of converting waste materials into oil using coal 
liquefaction technology. If a cost-effective means can be determined, 
this may be a way to achieve the environmental benefit of helping 
dispose of urban waste by co-processing it with coal to develop a new 
domestic oil source. What results have been achieved to date as a 
result of Federal support provided for this consortium?
    Answer. The Consortium for Fossil Fuel Liquefaction Sciences has 
conducted considerable laboratory experimentation of coal with waste 
material such as tires, plastics, paper and other waste materials to 
provide the fundamentals which are now being exploited at the 
continuous bench scale level. The consortium is also performing a study 
to determine the optimum feeds and conditions for a conceptual waste/
coal liquefaction facility. This approach has the potential of reducing 
the cost of coal derived liquid fuels to below $20 a barrel.
    Question. Are there important ``next steps'' that need to be taken?
    Answer. The next steps would include development of a continuous 
bench scale database for coprocessing of coal/petroleum resid/waste 
materials. The continuous database is being developed by Hydrocarbon 
Technologies, Inc. (HTI). Emphasis is being placed on establishing 
process conditions and expanding the waste materials that can be 
effectively handled. This database will be utilized for future 
feasibility studies for a coprocessing ``pioneer plant'' facility.
    Question. In fiscal year 1997, the consortium is funded at a level 
of $1 million. The group has requested $1.7 million for fiscal year 
1998, but no funding is proposed in the DOE budget. What could be 
accomplished if the Consortium's requested funding level ($1.7 million) 
is provided?
    Answer. If the requested funding of $1.7 million for fiscal year 
1998 is provided, the Consortium could continue investigating 
additional methods for pre-treatment and exploring additional 
coprocessing feed mixtures utilizing coal with municipal solid waste, 
plastics, used tires, and other hydrogen-rich waste. The program would 
be able to explore additional commercial opportunities to utilize the 
cleaned product stream and convert it into high value products such as 
commercial chemicals for transportation fuel production. Efforts would 
also increase to improve the environmental performance of direct 
liquefaction concepts leading to potential reduction in carbon dioxide 
production.
    Question. What would be achieved if the prior year funding level 
($1 million) is maintained?
    Answer. With the restoration of the prior year (fiscal year 1997) 
funding level of $1.0 million, the Consortium could continue to 
maintain the present level of effort in conducting bench-scale research 
to improve the data base of knowledge for coal/waste coprocessing.
                 advanced clean/efficient power systems
Advanced pulverized coal-fired powerplant
    Question. A major objective of this program is to redesign the 
currently widely- used pulverized coal combustion system to gain major 
performance improvements. In the end, it is hoped that the result will 
be a powerplant design with very low emissions (<1/6 New Source 
Performance Standards) and significantly higher efficiency (> 42 
percent) than conventional plants. If this can be achieved, export 
opportunities for these technologies could be pursued.
    Low Emission Boiler System (LEBS).--This program was conceived as a 
four phase technology development effort to test at a scale sufficient 
to provide performance guarantees for a commercial system when the test 
is completed. Three contractors completed phase II (engineering 
development) in fiscal year 1996; during fiscal year 1997, three 
contractors will complete Phase III (engineering design of proof-of- 
concept test facility); for fiscal year 1998--budget proposes 
downselect to one contractor to continue Phase IV (proof-of-concept 
facility construction and operation). Based on the results to date in 
the LEBS program, are there particular strengths of the various 
technologies being developed by the three contractors that would lead 
DOE to support continuing more than one contractor to Phase IV?
    Answer. The program objectives, plant efficiency, emissions levels, 
and cost are the same for each contractor. Although each contractor 
uses different technologies, based on the results, to date, it appears 
each will meet the requirements for Phase II and Phase III. Currently, 
it is premature to judge the specific strengths and weaknesses of the 
technologies under development. However, it can be observed that two 
distinct development approaches are being pursued. One, the Kalina 
cycle, represents a high risk, revolutionary approach to bring a 
totally new power technology into the marketplace. The other represents 
a low risk approach to greatly extend the performance of pulverized 
coal plants in a less revolutionary manner. The process for selecting a 
developer to continue in Phase IV of the LEBS program will be to form a 
Federal team of experts who will review and evaluate the Phase II and 
Phase III results as submitted by each of the three contractors. 
Selection will be based on an evaluation of the submissions and arrived 
at by a ranking grounded on a set of technical and other criteria.
    Question. Are the economics of some of the technologies under 
consideration more attractive than others?
    Answer. Until the submission of the results for Phase II and Phase 
III, there is no basis to conclude that one technology is more 
economically attractive than another technology.
    Question. How so?
    Answer. A thorough and critical evaluation of the results for 
Phases II and III is required before a conclusion regarding the 
economics of each technology can be made.
    Question. What is the schedule for making a down-selection prior to 
the start of Phase IV?
    Answer. Results for Phase II and Phase III are due at the end of 
July 1997. A 2-month evaluation period is planned. Phase IV is 
scheduled to begin in early fiscal year 1998.
    Question. Might the selection of one contractor's proposed 
technology as compared to another's affect the funding requirements for 
fiscal year 1998?
    Answer. Yes, but we expect to negotiate a cost, a cost-sharing 
level, and a schedule for the project acceptable to both DOE and the 
contractor.
    Question. To what extent is the overall DOE funding required over 
the life of Phase IV a factor in the down selection decision-making 
process?
    Answer. We expect to select the best proposal based on a thorough 
evaluation of the results from Phases II and III as ranked against a 
set of criteria. For the anticipated funding, we expect to negotiate a 
cost, a cost-sharing level, and a schedule for the project acceptable 
to both DOE and the contractor.
    Question. What funding is necessary in fiscal year 1998 to begin 
Phase IV?
    Answer. We believe the request for $5,462,000 allows us to begin 
Phase IV in fiscal year 1998.
    Question. What was the original program plan for the duration of 
Phase IV?
    Answer. The duration of Phase IV was always anticipated to be 
approximately 3 years.
    Question. Is it possible to stick to this schedule at the funding 
level proposed for fiscal year 1998?
    Answer. Until a developer is selected and negotiations begin, it is 
premature to know, with any certainty, the actual duration of Phase IV. 
For the larger proposals, the schedule could be extended beyond three 
years if funding levels could be increased sufficiently in future 
years.
                          indirect fired cycle
    Question. The High Performance Power Systems (HIPPS) program 
incorporates a new high temperature advanced furnace that integrates 
the combustion, heat transfer, and emission control processes. As with 
LEBS, HIPPS is geared at increased efficiencies (> 45 percent) and 
reduced emissions (< one-tenth New Source Performance Standards). These 
system efficiencies will also contribute to reduced carbon dioxide 
emissions levels. The fiscal year 1998 budget proposes continuation of 
Phase II (engineering development and testing) for the HIPPS program. 
There are presently two contractors participating in this program. An 
increase of $1.5 million is proposed to put the program on a schedule 
to complete Phase II by the year 2000. What is the estimated cost to 
complete Phase II?
    Answer. In order to complete Phase II at the end of fiscal year 
2000, a total of $44 million is required for fiscal years 1998 to 2000.
    Question. What level of cost-sharing are the partners contributing 
to this program?
    Answer. The cost sharing required in Phase II of the HIPPS project 
is 25 percent.
    Question. Given the significant additional costs and time required 
to complete Phase II, should this program be continued?
    Answer. We recommend that HIPPS be continued. The Fossil Energy 
RD&D Program has a number of technologies in its portfolio, HIPPS being 
one of them. This balanced approach reduces the overall risk in 
achieving the Fossil Energy mission. To not continue HIPPS, increases 
this risk.
    Question. What consequences will accrue if the increased funding 
for HIPPS is not provided for fiscal year 1998?
    Answer. The schedule will be stretched. However, the current re-
structuring occurring in the electrical power industry has widened the 
window of opportunity for advanced pulverized coal technologies. At 
this time, a delay of several years does not appear to have a major 
impact on the potential success of HIPPS technology.
    Question. Will the schedule be stretched to the point that it no 
longer makes sense to continue HIPPS?
    Answer. It depends on how it is stretched. A schedule based on 
historical funding does not appear to place the success of HIPPS 
technology in jeopardy since it is a longer-term technology.
    Question. Which is more important based on technological promise--
continuing more contractors to Phase IV in LEBS or continuing the HIPPS 
program?
    Answer. While LEBS currently is of higher priority, both LEBS and 
HIPPS are promising technologies--LEBS for the near-term and HIPPS for 
the mid-term. Both should remain in the Fossil Energy portfolio of 
technologies. The approach of including several technologies that would 
enter the market at different time periods reduces the overall risk of 
Fossil Energy achieving its mission.
                 integrated gasification combined cycle
    Question. This technology can convert coal into a clean gas used to 
fuel gas turbines and provide steam for a steam turbine cycle. 
Increased efficiencies (> 52 percent) and reduced emissions (< one-
tenth NSPS) are the goal. To date, costs have not been reduced 
sufficiently to make this a widely used technology. DOE's program is 
focused on hot gas sulfur and particulate removal and control of air 
toxics and pollutants. To assist in these efforts, a desulfurizer 
process development unit (PDU) is being constructed at Morgantown. What 
is the status of construction of this unit?
    Answer. As of February 1997, PDU construction is 78 percent 
complete and scheduled for start of shakedown operation in fall 1997. 
Integrated operation will begin in June 1998.
    Question. Are additional funds necessary in fiscal year 1998 to 
complete construction?
    Answer. No funds in addition to the fiscal year 1998 Budget Request 
are needed to complete construction. Within the funding for IGCC, $2.4M 
will be required to complete construction activities and $530,000 will 
be required to complete shakedown operation activities during fiscal 
year 1998 (total $2.93M).
    Question. Are these funds included in the budget request?
    Answer. Yes, the required funds have been included in the fiscal 
year 1998 budget request.
    Question. What is the significance of the desulfurizer PDU to 
making integrated gasification combined cycle technology more cost-
competitive?
    Answer. The Hot Gas Desulfurization (HGD) PDU is a flexible 
facility capable of operating either as a fluid-bed or transport-bed 
reactor. Reactant gas is provided by a synthesis gas generator that can 
simulate a broad range of coal gasification product compositions. The 
PDU will operate over a wide range of sulfur concentrations and process 
conditions to optimize performance and provide engineering data for a 
wide variety of IGCC applications. Compared to other HGD technologies, 
the transport and fluid-bed reactors provide for a stable operation, 
improved heat integration, improved sorbent performance and life, and 
lower capital cost. These features are expected to lead to a reduction 
in capital cost, as well as higher efficiencies for future IGCC 
applications. The engineering data and capital cost reduction to be 
provided by the PDU are expected to lead to a reduction in the cost of 
electricity.
    Question. How will the PDU contribute to better efficiency and 
reduced emissions?
    Answer. Development of the fluid-bed and transport reactor 
technology for hot gas desulfurization is expected to result in 
approximately a 2 percentage point improvement in overall plant thermal 
efficiency compared to conventional technologies. Such improvements in 
efficiency from hot gas desulfurization coupled with further 
developments in advanced power cycles, advancements in air separation 
technologies using ceramic membranes, and the coproduction of 
environmentally superior transportation fuels and/or high value 
chemicals, has potential for achieving very high thermal efficiencies, 
approaching 55-60 percent by 2010. At these efficiencies, IGCC 
technologies will be among the cleanest, environmentally friendliest 
technologies for the generation of electricity and other products.
    Question. The budget also includes a proposed increase of $1.251 
million for enhanced testing of sorbents to address hot gas clean-up 
and sulfur controls. What portion of this funding will be used for 
testing of sorbents in the desulfurizer being constructed at 
Morgantown?
    Answer. No portion of this funding increase will be used for 
testing of sorbents in the FETC Morgantown hot gas desulfurization PDU. 
The funding increase is for continued R&D and testing of novel and 
advanced sorbents to control sulfur and NOx emissions, 
completing R&D on sulfur recovery concepts, and validating performance 
of promising hot gas cleanup materials, components, or subsystems in 
facilities through slipstream/coupon testing. Such work is to be 
conducted at General Electric, Research Triangle Institute, and 
industrial companies yet to be determined through competitive 
solicitations.
    Question. Why is it important to conduct tests both at Morgantown 
and at the IGCC clean coal project at Tampa?
    Answer. Two very different reactor concepts are being tested by 
Tampa Electric and FETC Morgantown. The Tampa project will demonstrate 
the General Electric moving-bed desulfurizer concept for hot gas 
cleanup. This concept has been developed by General Electric over the 
past 10 years through DOE sponsorship. It has been taken through the 
research scale-up process from bench-scale simulated gas testing to 
real coal gasifier-fired Process Development Unit testing. It is ready 
for demonstration in a commercial setting as planned for this year at 
Tampa Electric's Polk Power Station. The FETC desulfurizer is at the 
Process Development Unit testing scale. It employs two reactor 
concepts, the fluid-bed and transport-bed reactor for hot gas 
desulfurization. It is fired by a simulated coal gas, and initial R&D 
efforts will focus on transport-bed desulfurization.
    All three concepts are being developed and proven out in order to 
establish the most efficient and effective desulfurizer system for hot 
gas cleanup. Hot gas cleanup is a critical subsystem to both IGCC and 
PFB technologies in order to achieve much higher efficiencies. The 
Department believes that it is necessary to develop more than one 
desulfurizer system to minimize the technical risk. Additionally, the 
two desulfurizers at FETC Morgantown will be used to test and develop 
various sulfur sorbents. The Tampa CCT project is demonstrating the 
larger G.E. moving-bed desulfurizer as a critical subsystem versus 
conducting a sorbent R&D test program.
                       pressurized fluidized bed
    Question. This technology involves high combustion and heat 
transfer efficiency; sulfur dioxide removal through the introduction of 
sorbents; and low NOx emissions as a result of low 
combustion temperatures. In fiscal year 1998, an increase of $796,000 
is recommended for continued research at Morgantown on hot gas 
particulate cleanup and to improve understanding of combustion in the 
PFB technology. The objective is to reduce the risks associated with 
commercialization of PFB technology. To what extent is the funding 
necessary for the research at Morgantown linked to technical issues 
that have surfaced as a result of testing done at the Wilsonville 
facility?
    Answer. Filter testing to date at Wilsonville is limited to 
shakedown mode of operation. There are insufficient hours of operation 
for technical issues to surface to date. The Wilsonville Advanced PFBC 
pilot scale process, which includes high-temperature filter systems, is 
scheduled to go into operation in first quarter 1998. The Morgantown 
Research Development Program is the primary center of effort which 
focuses on filter systems development in support of future testing at 
Wilsonville. For example, the filtration systems are being developed in 
partnership with scientists at the Oak Ridge National Laboratory and 
with cost-share industrial vendors such as Westinghouse Science & 
Technology Center (Pittsburgh, PA); Pall Corporation (Cortland, NY); 
Babcock & Wilcox (Lynchburg, VA); DuPont/Lanxide (Newark, DE); 
Techniweave (Rochester, NH); Combustion Power Company (San Mateo, CA); 
and Industrial Filter & Pump Mfg. Company (Cicero, IL). Other vendors 
providing systems and components include Coors Ceramics (Golden, CO); 
3M (St. Paul, MN); Refractron Technologies Corp. (Newark, NY); and 
CeraMem (Waltham, MA). This research is necessary in support of the 
performance of advanced PFBC systems in order to meet current and 
future particulate emissions standards and stringent gas turbine inlet 
specifications. In addition to supporting the Wilsonville facility, the 
Morgantown research also supports the DOE Clean Coal Technology Program 
which currently has one advanced PFBC project that will utilize this 
technology.
    Question. If the increased funding is not provided, what 
consequence will this have on making further progress towards proving 
the viability of the PFB technology?
    Answer. If the increased funding is not provided, it would 
significantly delay resolution of key filter issues, e.g., long-term 
temperature degradation, overall system reliability, and would 
significantly increase the performance risks associated with the hot 
gas cleanup system operation at Wilsonville and the Lakeland Advanced 
PFBC CCT Demonstration project.
                          natural gas research
Coal mine methane
    Question. The fiscal year 1998 budget proposes $963,000 for 
research into the issue of coalmine methane. Current mining practices 
often result in venting of methane gas to the atmosphere, which is a 
concern in terms of greenhouse gases. Is the release of methane gas 
into the atmosphere a problem for all mines, or is it particularly 
focused on smaller mines?
    Answer. Methane emissions from coal mines are a significant source 
of greenhouse gas. EPA estimates that in 1988 about 9.0 to 12.6 million 
metric tons of carbon equivalent (MMTce) was released from the methane 
emission of 60 mines classified as large and gassy (greater than 0.5 
million tons of coal per year and greater than 500 cubic feet of 
methane per ton of coal). EPA further estimates that 19.2 to 30.0 MMTce 
will be released from coal mines in 2000.
    Question. Why is it more of a problem for smaller mines?
    Answer. The goal of the program is to expand existing research 
efforts to broaden the range of cost-effective technologies/methods for 
recovering and utilizing methane associated with mining, especially in 
smaller mines where the economics of methane recovery is marginal.
    Question. How would the proposed funds be used?
    Answer. Ten Phase I awards were made in fiscal year 1995 for 
feasibility studies in response to a competitive solicitation that 
sought proposals for cost-shared demonstrations of alternative ways by 
which recoverable methane released in the course of underground coal 
mining could be economically utilized. Based on an assessment of these 
studies, five of the proposers were selected for Phase II engineering 
design preparation. The requested amount would fund the Phase II 
Engineering Design for the five contractors selected.
                       advanced turbines program
    Question. In fiscal year 1997, Congress funded the advanced 
turbines program at a level of $46.6 million. In fiscal year 1998, the 
Administration proposes to reduce this program by $15.2 million to a 
level of $31.4 million. This reduction occurs despite indications that 
development of advanced turbines is a high priority because of the 
potential results--high efficiency (greater than 60 percent, as 
compared to current power generation systems in the 35 percent range). 
When the turbine program began, the Department laid out its plan for a 
comprehensive program and a series of timetables. Based on the funding 
provided to date for this program, what is the current schedule for 
completion of the turbines program?
    Answer. Based on the funding to date, and assuming future funding 
is consistent with the ATS Turbine funding profile provided to Congress 
in fiscal year 1994, estimated completion is the end of 2000. However, 
with the fiscal year 1998 budget request of $31.4 million, the 
estimated completion is the end of 2002.
    Question. How does this compare to the initial proposal?
    Answer. The funding provided thus far is consistent with the same 
completion date as the initial proposal. However, with the fiscal year 
1998 budget request, the estimated completion is stretched out by two 
years.
    Question. How does the funding level proposed for fiscal year 1998 
affect the schedule?
    Answer. The administrative budget for fiscal year 1998 of $31.4 
million would stretch out the program by 2 years.
    Question. What are the advantages and disadvantages of stretching 
out the schedule?
    Answer. An advantage to stretching out the schedule is that budget 
needs are spread out over a longer time period, thus enabling us to 
deal with budget constraints. The disadvantage to stretching out the 
schedule is the potential loss of market share to foreign competitors 
and increases in overall program cost due to slip in schedule.
    Question. How does it affect the overall cost of the program?
    Answer. The overall cost of the program would escalate due to 
general inflation caused by a stretch in the schedule. This is due to 
work that will have to be performed at a date later than currently 
planned with attendant higher labor and material costs.
    Question. Does the fiscal year 1998 budget include adequate funding 
to complete all aspects of Phase III (full scale component and sub-
system testing)?
    Answer. The fiscal year 1998 budget of $31.4 million is adequate to 
complete the originally planned baseline activities for fiscal year 
1998 (including Phase III), but will stretch out the overall program 
schedule by up to 2 years.
    Question. Are there promising technological advances thus far in 
the turbines program that merit further investigation as part of phase 
III?
    Answer. With the funding levels of fiscal year 1997 ($46.6 million) 
Phase III has remained on schedule and several promising technological 
advances have been made in the program. Both General Electric and 
Westinghouse have performed tests and collected data to verify that 
their advanced gas turbine designs can be successfully manufactured and 
operated. During the past year, both General Electric and Westinghouse 
have made significant progress in advanced turbine engine design and 
technology validation testing. GE successfully completed heat transfer 
testing on full-scale, first-stage nozzle cascades at their laboratory 
in Evendale, Ohio. Results of the test showed that steam cooling is as 
effective as predicted with pre-test calculations. Steam cooling is a 
revolutionary technique which has not yet been used to enable gas 
turbine operation at ultra-high efficiencies. The GE Advanced 
Technology Combined Cycle promises improved economics of electric power 
generation with outstanding environmental performance in natural gas 
and coal-fired applications. Under the first year of Phase III, 
Westinghouse has also been highly successful in technology development 
and testing. During this stage of the program, Westinghouse has 
successfully developed and tested the piloted-ring combustor for ultra-
low NOx emissions with excellent stability, advanced seals 
for increased turbine efficiency, new thermal barrier coatings (TBC), 
and a new inspection tool to spot TBC defects before they become a 
problem. These promising technologies developed during Phase III may 
merit further investigations beyond the originally planned baseline 
activities for Phase III.
    Question. If so, what funding is necessary to conduct the 
investigations?
    Answer. Funding required to conduct the investigations and to 
remain on the original schedule is estimated at $58.6 million for 
fiscal year 1998 as given in the 1994 Advanced Turbine System Program 
Report to Congress.
    Question. If the increased funding is not provided, how will DOE 
proceed?
    Answer. A stretch out in the program will occur and certain 
activities planned to be initiated in fiscal year 1998 will not begin 
until fiscal year 1999.
    Question. There are presently two major contractors participating 
in the utility-scale aspect of the turbines program. Is it DOE's 
estimation that a logical down-selection to one contractor should occur 
after completion of phase III and prior to initiation of phase IV?
    Answer. The original baseline program is structured to include a 
down-select to one contractor to continue in Phase IV. Down-selection 
to one contractor for Phase IV continuation could occur prior to final 
completion of Phase III if sufficient information from Phase III exists 
upon which to base a selection. The Department is also evaluating 
options for a restructured program that could include the retention of 
both developers, while maintaining cost to the Government within the 
original program estimate.
    Question. What funding is necessary to initiate phase IV and keep 
the program on-schedule?
    Answer. Funding of $58.6 million (as indicated in the 1994 Report 
to Congress) is necessary to initiate Phase IV and keep the program on-
schedule.
    Question. Is this amount included in the fiscal year 1998 budget 
request? If not, what funding level is necessary to stay on schedule?
    Answer. No. The fiscal year 1998 budget request of $31.4 would 
result in a shortfall of $27.2 million needed to stay on the initial 
schedule. The funding level of $58.6 million would be required to stay 
on that schedule.
    Question. What is the estimated total cost of phase IV?
    Answer. The anticipated Government cost for Phase IV of the program 
is approximately $155 million.
    Question. What level of cost-sharing is anticipated?
    Answer. The anticipated range of industrial cost share for Phase IV 
is in the 60 percent range. It will vary depending on final selections 
and negotiations.
                               fuel cells
    Question. Fuel cells represent another technology supported in the 
fossil energy program because of their promising prospect as a highly 
efficient and environmentally ``clean'' power system. Technology 
development continues to address cost barriers that preclude widespread 
market introduction. These systems, which can be operated using natural 
gas, and gas and coal (liquefied into gas), offer reduced pollutants 
and lower emissions than conventional power systems. When combined with 
gas turbines, fuel cells have the potential to operate at higher 
efficiencies (70 percent) and low emissions. The fiscal year 1998 
budget proposes $46.3 million in total for the fuel cell program, a 
decrease of $3.8 million from the fiscal year 1997 level. As with the 
turbines program, multiple contractors are involved in a multi-year 
program. What impact does the proposed fiscal year 1998 funding level 
have on the schedule for the molten-carbonate fuel cell program?
    Answer. The requested funding level for molten carbonate fuel cells 
for fiscal year 1998 is $32.7 million and is a result of having to 
balance the funding priorities given budget constraints. The impact is 
a 2-year slippage in the original schedule. It is now expected that 
developers would have a commercially ready molten carbonate fuel cell 
power system in 2002.
    Question. What funding would be necessary to maintain the current 
schedule?
    Answer. The estimated amount as reported by the contractors 
required in fiscal year 1998 to maintain the current schedule is a 
total of $50 million.
    Question. If the fiscal year 1997 funding level cannot be restored, 
would DOE consider downselecting to one contractor in the molten 
carbonate program?
    Answer. Downselecting to one contractor in the molten carbonate 
program is not planned. The prospects of successful market entry and a 
sustained domestic fuel cells industry are enhanced by maintaining both 
developers although it may result in the schedule being slipped.
    Question. What are the advantages and disadvantages of doing such a 
downselection at this time? (Appear to be in Phase III--product 
improvement and cost reduction--which is anticipated to last through 
fiscal year 1999).
    Answer. The advantages of a downselection to one contractor at this 
time are the concentration of requested molten carbonate funding to the 
remaining contractor thus allowing acceleration of that contractor's 
schedule. Disadvantages of down selection of a developer at this time 
include the following: It could result in collapse of the downselected 
developer or entry of foreign investors to fill the gap; since each 
developer is targeting a different power system application, it would 
leave that application unfilled; it would not protect the taxpayers' 
investment in this highly beneficial technology; the establishment of a 
strong, diverse, domestic fuel cell industry would not be realized; 
clean, highly efficient energy benefits, high value jobs and other 
economic benefits to the United States would be limited.
    Question. A different type of fuel cell technology is the solid 
oxide fuel cell. This program is proposed for funding at a level of 
$12.4 million in fiscal year 1998, roughly level with the fiscal year 
1997 appropriation. It is my understanding that the industry partner in 
this program has identified a need of $16 million for SOFC in fiscal 
year 1998. If this higher level is not provided, what do you anticipate 
will happen with the program?
    Answer. The requested level for fiscal year 1998 for the solid 
oxide fuel cell is a result of having to balance fiscal constraints 
with program needs to generate an overall balanced portfolio of 
technologies. The effect is that the developer is expected to stretch 
out the development schedules for 2 years and reach a commercially 
ready power system in about 2002.
                                 ______
                                 
                 Questions Submitted by Senator Cochran
                  state and local partnership programs
    Question.  Mr. Secretary, I've heard some good things about DOE's 
State and Local Partnership Programs as they operate in Mississippi. 
These funds have been used by our State Energy Office to create 
partnerships with other levels of government, non-profit entities, and 
businesses to leverage substantial additional funding and resources. 
While the fiscal year 1998 Request would provide a modest increase over 
last year, it is still far below the level provided back in fiscal year 
1995. Are you aware of the success that some of the States have 
achieved with these funds?
    Answer. We are indeed aware of the success of these programs. As 
example we cite the following programs sponsored by the State of 
Mississippi:
    Master Lease Program.--Utilizing services of legal and financial 
consultants funded under a DOE State Energy Program, the Mississippi 
Department of Economic and Community Development (MDECD)--Energy 
Division worked with state government leaders and secured legislative 
authority to establish a tax-exempt loan program through which a third-
party financier would provide pre-arranged, tax-exempt financing for 
energy efficiency projects in public facilities. The Master Lease 
Program reduces high origination fees associated with individual 
project financing and streamlines an otherwise lengthy funding process. 
The Energy Division provides technical assistance to the public 
administrators in determining an energy management improvement plan and 
provides the financier with verification of project need. Currently, 
more than $2.5 million in energy projects with an estimated $400,000 
annual energy dollar savings are underway in facilities operated by 
public school and local governing authorities.
    Alternative Passenger Rail Program.--Funding provided by the MDECD-
Energy Division along with other state, federal, local government 
units, and private entities has enabled four Mississippi coastal 
municipalities to renovate or construct manned or unmanned passenger 
facilities for both passenger and freight rail services. The 
renovations, such as parking lot improvements, upgrading handicapped 
facilities, and enhancing public waiting areas, enables the 
municipalities to promote energy efficiency by diverting traffic into 
intermodal activities such as park-and-ride and use of public transit 
for local travel along the Mississippi Gulf Coast.
    Energy Efficient Building.--Through local, state and federal 
funding, an energy efficient, environmentally controlled Math/Science 
Complex building was constructed on the campus of Northeast Mississippi 
Community College, Booneville, Mississippi. The MDECD-Energy Division 
provided both technical assistance and funds to install the most energy 
efficiency technologies currently available. The building has served as 
a model for energy efficient management planning for public use 
facilities. It has also been featured on national and international 
radio and television stations and in national consumer and trade 
magazines.
    Over the history of the State Energy Program and its predecessors, 
the State Energy Conservation Program and the Institutional 
Conservation Program, on a Nationwide basis over 8,000 State energy 
projects of many types have been funded, and over 69,000 schools and 
hospitals buildings have been made more energy efficient. Additional 
funding provided by DOE end-use sector offices since fiscal year 1996 
has allowed States to implement additional State-oriented building, 
industrial, transportation and utility sector programs.
    Question.  Given these good results, why isn't the funding for the 
State Partnership Programs being increased even more to bring it back 
in line with the fiscal year 1995 level of $53 million?
    Answer. In addition to the increased funding the Administration has 
proposed for the State Energy Program, which includes the State 
partnership activities, the Department of Energy has provided funding 
from end-use sector offices for Special Projects under SEP. Those funds 
totaled $11.2 million in fiscal year 1996 and $9.8 million in fiscal 
year 1997. It is anticipated that Special Projects funding will 
continue in fiscal year 1998. Traditionally State Energy Offices have 
been able to leverage their Federal funds for this program at the rate 
of 4 non-Federal dollars for each Federal dollar received, and have 
leveraged as much as 13 to 14 non-Federal dollars for each Federal 
dollar for some activities.
                         clean coal technology
    Question. Mr. Secretary, there is a very large clean coal 
technology project currently underway in Mississippi. What are your 
thoughts on DOE's long-term commitment to the Clean Coal Technology 
Program?
    Answer. The DOE is fully committed to the successful completion of 
the Clean Coal Technology Demonstration Program. Considerable effort is 
being dedicated to careful financial management and project stewardship 
of the program to successfully achieve a number of objectives. These 
objectives include completion of all projects in the program that 
continue to show success in achieving their technical milestones while 
at the same time providing the fiscal management that permits the 
Department to recommend the rescission of funds as they become excess 
to the needs of the program in accomplishing it's objectives.
                                 ______
                                 
                  Questions Submitted by Senator Leahy
                   energy information administration
    Question. Given this winter's unusually high prices for many fuel 
commodities across the country, especially home heating oil and 
propane, what actions is the Energy Information Agency planning to take 
to address the need for increased tracking and dissemination of 
information on trends in fuel prices?
    Answer. The Energy Information Administration took a number of 
measures to make the public aware of price volatility in the market 
place during the 1996/1997 heating season. EIA increased the frequency 
of its State Heating Oil and Propane Program (SHOPP) survey from 
semimonthly to weekly, thereby providing residential heating oil and 
propane prices on a more timely basis. In addition, EIA prepared 
numerous briefings, presentations, and articles, keeping the public 
informed of current market conditions. In early November, EIA 
cosponsored the Winter Fuels Conference in Washington, D.C., to inform 
energy officials about heating fuel outlooks for the upcoming winter 
heating season.
    Weekly price and supply information were disseminated through 
publications, market watch publications, phone (price hotline), fax-on-
demand, and the Internet. Through its energy emergency communications 
protocol with State Energy and Emergency Management offices, EIA was 
able to exchange information with states regarding any concerns and 
problems associated with transportation logistics, motor driver waiver 
restrictions, refinery problems, and heating fuel shortages. EIA also 
participated in biweekly conference calls with state offices to keep 
them informed of energy markets, as well as the status of the Low 
Income Home Energy Assistance Program. Currently, EIA is conducting an 
analysis of the propane market to examine the supply and demand 
conditions of the past heating season. This report will be published in 
May 1997.
    With respect to increasing the tracking and dissemination of fuel 
price information, EIA recognizes that there are several gaps in its 
coverage of sensitive winter fuels. These include timely data on retail 
natural gas prices year around and on other winter fuels during 
critical stock building periods in the late summer. There is little 
likelihood these gaps can be filled with existing resources. EIA will 
continue, however, to conduct the SHOPP survey for the upcoming heating 
season, publish monthly price and supply data, provide heating fuel 
assessments as needed, and coordinate energy information with State and 
Federal agencies.
    Question. In particular, I am concerned about the effects of 
potential cuts in EIA's budget on the provision of state-based data. 
How will EIA insure that this information is produced?
    Answer. EIA recognizes that state-level data is essential to many 
users and expects to continue its current coverage within the 1998 
budget. This has been possible through smaller samples and more 
efficient editing, processing, and dissemination procedures, including 
electronic methods. Nevertheless, any erosion of EIA resources from 
proposed levels may jeopardize all programs, including state-level 
data.
    Question. The Administration has stated that one of its primary 
goals for the coal program of the Fossil Energy and Research 
Development is to develop super-clean emission control systems for 
SO2, NOx, air toxics and particulate matter that 
can be applied to existing plants. Has the Department conducted studies 
or models on how these developments will assist industry in meeting the 
proposed EPA ozone and fine particulate standards and what cost-savings 
have been projected for industry in developing new systems?
    Answer. We have not conducted any modeling studies of the proposed 
EPA ozone and particulates standards. However, the goals of our 
programs are to achieve greater than 95 percent reduction in 
SO2, 70- to 90-percent reduction in NOx at one-
half the cost of currently available approaches, and to reduce 
particulate emissions to less than one-tenth New Source Performance 
Standards. Achievement of those goals could significantly reduce the 
cost of meeting potential new standards and the regulations implemented 
to achieve those standards.
                        electricity deregulation
    Question. As states begin to develop and implement their utility 
restructuring plans, a number of questions arise about the future of 
existing energy generating facilities that face regulatory and other 
costs that may affect their competitiveness. Some may argue that the 
closure of these plants will have environmental benefits and the 
federal government should look at ways to assist these facilities to be 
converted to more cost-effective power generation or decommissioning. 
Has the Department considered the establishment of a ``decommissioning 
fund'' to assist facilities and their surrounding communities reduce 
the economic impact of the transition.
    Answer. The overall impact of restructuring on plant retirement 
patterns is unclear, but we would not be surprised if it hastened the 
retirement of some existing fossil and nuclear generation units. We are 
aware of the potential economic hardships related to plant retirement, 
particularly in a small community that has relied on the plant as both 
a major source of employment and tax revenue. The Department has not, 
however, considered the idea of an economic decommissioning fund. The 
core of the problem appears to be the need for new economic development 
in communities affected by plant closures. We see this as an issue that 
states need to address as part of their overall plans for the 
transition to competition in retail electric markets.
                                 ______
                                 
                 Questions Submitted by Senator Dorgan
                  cooperative research and development
    Question. The scientific community, as well as the Administration 
itself in its 1994 report: ``Science in the National Interest'', 
recognizes the significance of basic research as the foundation for 
emerging technologies. The basic research component of the Jointly 
Sponsored Research program under the DOE Cooperative Agreement ensures 
that development activities address the public interest and not the 
special interests of individual industry partners; it is the antithesis 
of ``corporate welfare''. Yet, each year the Department of Energy's 
budget request fails to include funding for basic research under this 
program. Congress has traditionally restored funding for the basic 
research component so this crucial function has, fortunately, been able 
to continue. Can you provide me with the Department of Energy's 
justification for not including basic research funds in the Cooperative 
Research and Development Account?
    Answer. The Department is very satisfied with the cost sharing that 
both the Western Research Institute (WRI) and the University of North 
Dakota Energy and Environmental Research Center (UNDEERC) are receiving 
under the jointly sponsored research program. In order to get the 
greatest benefit from our limited budget resources, it was decided to 
support the cost shared aspects of this program instead of the base 
program, because it leverages the government funding to provide for 
significantly more research, and better assures its development in the 
marketplace.
    Question. The Department has recognized the EERC's expertise by 
including $1.864 million for cost-shared coal related research approved 
by the Department of Energy and which is consistent with the Fossil 
Energy mission. Did the DOE intend to limit this research initiative to 
coal to the exclusion of oil and gas, and if so, why?
    Answer. The Department, in requesting funds for University of North 
Dakota Energy and Environmental Research Center (UNDEERC), has 
anticipated a need to utilize the specific, recognized talents of the 
UNDEERC employees in the area of coal research. Currently, UNDEERC is 
providing support to Fossil Energy in the Advanced Clean/Efficient 
Power System area and it is possible that the Department would have a 
need for additional research in this area or in the Advanced Clean 
Fuels Research area.
                          advanced fuel cells
    Question. During your testimony before the subcommittee last year, 
you mentioned that you would be testing in the commercial market 
``advanced fuel cells'' that were developed under the Fossil Fuel R&D 
Program. Can you advise me of the results of these tests?
    Answer. The Molten Carbonate Fuel Cell Program has two field test 
demonstrations of technology developed under the Fossil Energy R&D 
Program. The first is a megawatt-scale integrated unit in Santa Clara, 
CA, operated by the City of Santa Clara. Testing has just been 
completed. The general power plant operation was successful despite 
some technical problems encountered. The unit operated as designed and 
produced full rated electric power into the power grid resulting in the 
largest fuel cell power plant operated in the United States. The 
fundamental problems experienced were not caused by principal 
developmental equipment and are easily surmountable. Plant operating 
time was limited to about 4,000 hours primarily by private-sector 
funding. The second field test demonstration is a 250-kilowatt 
integrated unit near San Diego, CA, operated by the local utility. It 
contains the world's largest molten carbonate fuel cell stack. 
Operation began in January and is currently successfully generating 
about 80 percent of full electric power and co-generated heat. 
Operating time of about 8,000 hours is scheduled. No significant 
technological problems have been encountered.

                          subcommittee recess

    Senator Gorton. The subcommittee will stand in recess until 
9 a.m., Thursday, April 10, when we will receive testimony from 
the Bureau of Indian Affairs and the National Indian Gaming 
Commission.
    [Whereupon, at 4 p.m., Thursday, March 13, the subcommittee 
was recessed, to reconvene at 9 a.m., Thursday, April 10.]



  DEPARTMENT OF THE INTERIOR AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

                              ----------                              


                        THURSDAY, APRIL 10, 1997

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 9 a.m., in room SD-124, Dirksen 
Senate Office Building, Hon. Slade Gorton (chairman) presiding.
    Present: Senators Gorton, Cochran, Domenici, and Bennett.

                       DEPARTMENT OF THE INTERIOR

                        Bureau of Indian Affairs

STATEMENT OF HON. ADA E. DEER, ASSISTANT SECRETARY FOR 
            INDIAN AFFAIRS
ACCOMPANIED BY:
        HILDA A. MANUEL, DEPUTY COMMISSIONER OF INDIAN AFFAIRS
        JOANN SEBASTIAN MORRIS, DIRECTOR, OFFICE OF INDIAN EDUCATION 
            PROGRAMS
        DEBORAH J. MADDOX, DIRECTOR, OFFICE OF TRIBAL SERVICES
        TERRY VIRDEN, DIRECTOR, OFFICE OF TRUST RESPONSIBILITIES
        JAMES H. McDIVITT, ACTING DIRECTOR, OFFICE OF MANAGEMENT AND 
            ADMINISTRATION
        LINDA RICHARDSON, DIRECTOR OF AUDIT AND EVALUATION
        JERRY SCHWEIGERT, FACILITIES TRANSITION PROGRAM STAFF
        ROSS MOONEY, DAM SAFETY OFFICER, BIA

                             budget request

    Senator Gorton. Good morning. The subcommittee meets today 
for the second of its hearings on 1998 budget requests for 
agencies funded by the Subcommittee on Interior and Related 
Agencies.
    This morning we will hear testimony regarding the 1998 
budget request for the Bureau of Indian Affairs and the 
National Indian Gaming Commission. Testimony on the Office of 
the Special Trustee for American Indians will be heard in 
conjunction with the Secretary of the Interior's hearing.
    We will begin with the Bureau of Indian Affairs and then 
proceed to the National Indian Gaming Commission [NIGC]. 
Because members of the subcommittee may have questions on both 
programs, we ask that all of the witnesses remain at the table 
for the duration of the hearing.
    Ada Deer, who has announced her departure from the BIA but 
who has not yet been replaced, will present testimony on the 
BIA budget together with staff. Ada Deer will also testify on 
behalf of the NIGC as the Commission's Acting Chairman. I 
encourage both the Bureau and the Commission to complete their 
processes for finding a permanent Assistant Secretary and 
Chair.
    Before you begin I would like to remind everyone here of 
the formidable task before the subcommittee. We are responsible 
for funding a number of diverse agencies. A large part of the 
bill is devoted to funding the four land management agencies: 
the Park Service, the Bureau of Land Management, the Fish and 
Wildlife Service, and the Forest Service. The cost of day to 
day management of our natural resources continues to increase 
in spite of a reduction in the rate of land acquisition, and 
inventories of infrastructure maintenance backlogs are 
increasingly unmet and growing into the billions of dollars.
    The second significant group of agencies in our bill is 
more loosely defined and consists of scientific agencies, like 
the Geological Survey, the Minerals Management Service, and the 
Office of Surface Mining, each of which has important 
regulatory, land management, or study responsibilities.
    The third major group of agencies in our bill are cultural: 
the Smithsonian, the National Gallery of Art, the Kennedy 
Center, and the National Endowments for the Arts and 
Humanities. While these agencies account for only a small 
portion of the total funds appropriated in the Interior bill, 
they are in many cases responsible for the protection of our 
Nation's heritage. As for the endowments, I imagine you are 
aware of the vocal support they receive from people all across 
the country, as well as from many Senators on both sides of the 
aisle.
    The fourth grouping of funding is for a portion of the 
Department of Energy programs.
    A final group consists of programs for the benefit of 
native Americans, including the BIA and the NIGC, but also 
including the Indian Health Service, for which the cost of 
simply maintaining existing levels of health services increases 
at an annual rate that exceeds inflation by a substantial 
amount.
    The bill will be increasingly burdened also by the costs 
associated with reform of trust responsibility functions.
    I have broken the bill out this way, Ms. Deer, so that you 
can see what your challenges are. The competition for funds 
will be even more fierce if the President and Congress are 
unable to enact a budget that includes measures that enable us 
to achieve balance without relying almost exclusively on 
reductions in discretionary spending. It is becoming ever more 
possible that such draconian measures are likely.
    The President's budget this year is relatively generous 
with this subcommittee, but the President's budget is also, by 
any rational and conservative standard, dramatically out of 
balance, and we will simply not get the allocation in the 
President's budget unless there is an agreement on entitlement 
reform and a number of other issues that have caused dramatic 
differences between the Congress and the President in the past.
    I hope we are going to be able to get that full allocation, 
but I am going to have to plan for a markup which has 
considerably less. As I told you each of the last 2 years, 
under those circumstances we are going to need your aid and 
assistance in setting priorities for the programs that are 
under the jurisdiction of the Bureau.
    With that, I will be delighted to hear your opening 
statement.

                   summary statement of hon. ada deer

    Ms. Deer. Thank you, Mr. Chairman, and the other 
distinguished members of the committee when they arrive.
    Senator Gorton. We hope we will have some more of them here 
before you are finished.
    Ms. Deer. I am delighted to be here today to present 
testimony on support of the President's request for the Indian 
affairs budget. Rather than read the prepared testimony which 
has already been submitted for the record, I will present a 
very short summary.

                       introduction of Associates

    Accompanying me we have: Hilda Manuel, Deputy Commissioner; 
Deborah Maddox, Director of Tribal Services; Terry Virden, 
Director of the Office of Trust Responsibilities; Joann 
Sebastian Morris, Director of Tribal Education; and Jim 
McDivitt, budget and administration. I am not sure I have your 
correct title, but those are your functions.
    Mr. McDivitt. Close enough.
    Ms. Deer. This budget is extremely lean. Yet it is 
responsive to the needs of the tribal communities. It provides 
funds for the basic operation of the Bureau and will permit us 
to alleviate some backlogs in trust programs. Great care has 
been taken in its preparation and we strongly urge this 
committee to appropriate funds at the President's requested 
level of $1.73 billion.
    The proposed budget contains a modest increase of $126 
million over the fiscal year 1997 appropriation. Nearly one-
half of this increase will accrue to the tribal priority 
allocation to support vital tribal governmental services such 
as law enforcement, social services, child welfare programs, 
among others.
    Since 1995 shortfalls in these programs have been 
particularly serious. The exceptionally harsh weather patterns 
of the past 2 years have damaged buildings, roads, bridges, and 
other physical infrastructure in many areas, increasing needs 
as well.
    About one-third of the requested increase will benefit 
Indian schools. I have made a point of visiting as many tribal 
and BIA schools as possible. Recently I had the opportunity to 
visit the Chief Leschi High School in Washington State. While I 
was there I learned, Mr. Chairman, that you have been a strong 
advocate and supporter for the school, and I want you to know 
how much your efforts are appreciated.
    It is a wonderful school, one of the finest, and any 
community would be proud to have a school like this. I wish 
that every school in our system was like the Chief Leschi High 
School. Unfortunately, this is not the case. Classrooms are 
overcrowded in virtually all of the schools and some are in a 
disgraceful state of dilapidation and disrepair. The bus fleet 
is aging, a process accelerated by the rough roads and harsh 
climates in much of Indian country.
    Funding has not kept pace with the needs of our school 
system, which are growing. We anticipate an annual increase in 
enrollment of approximately 3 percent. One-third of the BIA's 
requested construction budget will be used for education 
construction so that we can continue to replace some of the 
unsafe schools on the priority list.
    The schools on that priority list are some of the oldest, 
most dilapidated schools in our system; $8 million of the 
requested increase in the facilities improvement budget and 
repair will be used for school repairs.
    At a minimum, we must provide children a safe learning 
environment in schools that meet accreditation standards and 
good teachers who are provided essential training and 
continuing education. The requested resources are vital to this 
result.
    The remainder of the requested increase will be used to 
address high priority needs in a number of areas, particularly 
in relation to public health and safety. Some $4 million of the 
increase will be used to repair structural deficiencies in 
high-hazard dams on Indian lands. This is particularly 
important given the severe flood conditions in many areas of 
the country this past year.
    We have requested a $12 million increase for public safety 
and justice construction, which will fund the construction and 
repair of detention centers and the establishment of fire 
protection safeguards and schools and other facilities.
    Mr. Chairman, I know that you are interested in determining 
the level of tribal investment in various tribal governmental 
operations in comparison to the Federal contribution. I am 
pleased to be able to address this issue here today. While 
there are some differences between the accounting methodologies 
used by Federal and tribal governments respectively, we were 
able to produce a reasonably reliable snapshot based on 
information in the single audit reports filed by tribal 
governments.
    We reviewed the expenditures documented by 192 tribes in 
these reports. The total came to 1.3 billion. You may be 
surprised to learn that 45 percent of the total, or $593 
million, came from the tribes' unrestricted general fund. 
Department of the Interior contributed slightly less than 25 
percent or $324 million. The remaining 30 percent, or $399 
million, came from other Federal and State sources.
    Finally, Mr. Chairman, I know you have had serious concerns 
about the BIA's efficiency. I would like to take this 
opportunity to emphasize that we have been sensitive and 
responsive to fair criticism. I have long been a strong and 
outspoken advocate of measures to make the Bureau a more 
efficient, effective responsive, and responsible agency, and I 
have pushed hard to improve its management and operations.
    We have also worked hard to carry out Congress' intent to 
shift greater authority and responsibility for program and 
service delivery to tribal governments. Accordingly, we have 
been able to reduce our FTE level by more than 2,000 positions 
since 1995, achieving our lowest staffing level in more than 15 
years. This is due to large congressional budget reductions as 
well as increased tribal contracting.
    In spite of diminished resources, we have achieved a 66-
percent improvement in resolving material weaknesses in our 
management. We have satisfactorily resolved 11 material 
weaknesses, bringing the number from 16 to 5 in the last 4 
years. We have closed all of the 123 overdue external audits 
which existed when I was sworn in and none are overdue at this 
time.
    We have dramatically improved the rate at which corrective 
actions are taken to problems identified in internal audits, 11 
internal audits have been closed just since September.
    While we have worked hard to improve our management and 
become more efficient, we have realized some negative impacts 
from downsizing. The backlogs in land titles and records have 
increased. Recently the inspector general identified problems 
in our computer operations attributable to lack of staff. There 
was a loan servicing failure in the Phoenix area because of 
insufficient staff.
    The few modest increases requested in this budget will 
allow us to alleviate some of the most severe backlogs in our 
trust operations, including land titles and records and 
administrative records management, and to continue work toward 
replacement of the facilities management information system.

                           prepared statement

    We have made a real difference in the way our Nation 
conducts its affairs with the first Americans. Today 90 cents 
of every dollar directly serves tribal communities and tribal 
members. Gone is the attitude that the Bureau knows what is 
best for Indian people. Today the Bureau works to empower 
tribal governments. It is a new era. Yet we must be cognizant 
of and act consistently with the solemn duties and obligations 
to which our Nation pledged itself some 200 years ago.
    There are no frills in the budget that we have presented 
today. Hard choices were made and priorities were set. We urge 
favorably the consideration of the President's request.
    Thank you and we are open for questions.
    [The statement follows:]

                  Prepared Statement of Hon. Ada Deer

                              introduction

    Good morning, Mr. Chairman and Members of the Committee.
    The Bureau of Indian Affairs (BIA) is the principal bureau 
within the Federal Government responsible for the 
administration of federal programs for federally recognized 
Indian tribes, and for promoting Indian self-determination. In 
addition, the BIA like all Federal agencies has a trust 
responsibility emanating from treaties, statutes, judicial 
decisions and agreements with tribal governments. The mission 
of the BIA is to enhance the quality of life, to promote 
economic opportunity, and to carry out the responsibility to 
protect and properly manage the trust assets of Indian tribes 
and Alaska Natives. The BIA provides resources and delivers the 
kinds of services to support tribal government operations 
similar to those provided by State, city, and municipal 
governments. These services include, but are not limited to: 
law enforcement, social services, education, housing 
improvements, loan opportunities for Indian businesses, and 
leasing of land.
    The BIA currently provides Federal services to 
approximately 1.2 million American Indians and Alaska Natives 
who are members of more than 550 federally recognized Indian 
tribes in the 48 contiguous States and in Alaska. The BIA 
administers more than 43 million acres of tribally-owned land, 
more than 10 million acres of individually-owned land, and over 
400,000 acres of federally owned land which is held in trust 
status.
    The Bureau is headed by the Assistant Secretary--Indian 
Affairs, who is responsible for BIA policy. Reporting to the 
Assistant Secretary are the Deputy Assistant Secretary for 
Indian Affairs, the Deputy Commissioner of Indian Affairs, the 
Director, Office of Indian Education Programs and the Directors 
of the Offices of American Indian Trust, Self Governance and 
Audit and Evaluation. Day-to-day operations of the BIA are 
directed by a Deputy Commissioner of Indian Affairs, who has 
authority over 12 Area Offices, 83 Agency Offices, three 
subagencies, six field stations, and two irrigation project 
offices. The Director of the Office of Indian Education 
Programs has direct authority over 26 education line officers. 
At the end of fiscal year 1996, the BIA's total employment was 
10,672 full-time equivalents.

                              streamlining

    While increased tribal contracting of programs and the 
transfer of schools to tribal operation has resulted in a 
consistent decline in BIA staff over the last decade, the most 
significant change in Bureau staffing levels occurred in fiscal 
year 1996 as a result of Congressional budget reductions. The 
number of BIA staff is at its lowest level in over 15 years; 
FTE levels have been reduced by more than 2,000 since 1995.
    The BIA Central Office has been trimmed to a ``residual'' 
level where only trust and inherently federal functions remain. 
Management and administrative positions have been reduced 
bureau wide to levels at or below the ratios and proportions 
recommended by the National Performance Review. Budget 
specialists, acquisition specialists, accountant positions, and 
personnel specialists have all been reduced by significant 
numbers.
    At the field level, many FTE reductions are taking place as 
a result of increased tribal contracting and self-governance 
compacting. One recent example is the Red Lake Agency in 
Minnesota, where the Red Lake Band of Chippewas is now 
contracting for all BIA funded programs resulting in the 
displacement of more than 70 Bureau employees. Another example 
is the Mississippi Band of Choctaws who are taking over all of 
the BIA facilities operations at the Choctaw Agency displacing 
12 to 15 BIA employees. Many tribes which have not previously 
contracted with the BIA are issuing notices of intent to 
contract an entire agency, such as in the Albuquerque Area, or 
law enforcement programs, as has occurred at several agencies.

                    fiscal year 1998 budget overview

    The fiscal year 1998 budget request for the BIA is $1.73 
billion in current appropriations, an increase of about $126 
million above the 1997 enacted level. The budget emphasizes the 
resources tribes need to provide basic reservation programs, 
develop strong and stable governments, ensure accreditation of 
Bureau schools, address critical infrastructure needs, and meet 
the Secretary's trust responsibilities. The BIA continues to 
keep administrative costs low; more than nine of every ten 
dollars appropriated to the BIA is provided directly to 
reservation programs.
    While the BIA's role has changed significantly in the last 
two decades with an increasingly greater emphasis on Indian 
self-determination, Indian tribes still look to the Bureau to 
provide a broad spectrum of critical and complex services 
administered either by the tribes or the BIA: from an education 
system for an estimated 52,400 elementary and secondary 
students; to 24 tribally controlled community colleges; to law 
enforcement and detention services on more than 200 
reservations; to social services programs for children, 
families, the elderly, and the disabled; to management of the 
forest, mineral, fishery and farmland resources on trust land; 
to the maintenance of more than 25 thousand miles of roads and 
bridges on rural and isolated reservations; to economic 
development programs in some of the more depressed areas in the 
U.S.; to the negotiation and implementation of legislated land 
and water claim settlements; to the replacement and repair of 
schools and detention centers; and to the repair of structural 
deficiencies on high hazard dams.

                      operation of indian programs

    In fiscal year 1998, the total request for Operation of 
Indian Programs (OIP) is $1.54 billion, an increase of $105 
million over the fiscal year 1997 enacted level.
    Within OIP, the single largest budget activity is tribal 
priority allocations (TPA) on which tribes depend for basic 
necessities and services such as law enforcement, child 
welfare, scholarships, natural resource management, and other 
programs critical to improving the quality of life and the 
economic potential of the reservations. Congress has given the 
tribes the flexibility to prioritize funds among TPA programs 
according to their unique needs and circumstances. TPA supports 
the goals of Indian self-determination by providing tribes with 
a choice of programs, as well as the means of delivery, either 
by the tribe or the BIA.
    In fiscal year 1998, TPA will comprise nearly half of the 
BIA operating budget. The TPA activity is funded at $757 
million, an increase of $76.5 million over the fiscal year 1997 
enacted level, to help tribes address the unmet needs in basic 
programs. Shortfalls in these programs have become particularly 
serious with the reductions in this activity since 1995.
    In fiscal year 1998, the BIA will continue to operate as a 
highly streamlined and decentralized agency, with maximum 
resources going to tribal programs. The BIA has identified $3.4 
million that will be transferred to TPA programs in fiscal year 
1998. The BIA anticipates that about half of the fiscal year 
1998 operating budget will be spent directly by tribes which 
elect to operate various Bureau programs under self-
determination contracts, grants, or self-governance compacts. 
Self-governance compacts, which give tribes greater flexibility 
to administer BIA programs, now number 60 and are expected to 
rise to more than 70 in 1998.
    Congress continues to fund specific Indian Education 
programs in response to treaty requirements and federal 
statutes. Current Indian Education programs are governed by a 
number of laws, including the Snyder Act, the Johnson O'Malley 
Act, the Elementary and Secondary Education Act, the Tribally 
Controlled Community Colleges Assistance Act, the Tribally 
Controlled Schools Act; the Education Amendments of 1978; the 
Hawkins Stafford Act; and most recently, Goals 2000 and the 
Improving America's Schools Act. Collectively, these laws are 
aimed at ensuring quality education of Indian youth and 
improving the long-term employment and economic opportunities 
on reservations.
    The fiscal year 1998 budget includes a significant 
investment in Indian education. The request for School 
Operations, which will fund schools and dormitories serving an 
estimated 52,400 elementary and secondary students in 23 
States, is $467 million, an increase of $16.8 million over 
fiscal year 1997. The increase is needed to ensure that schools 
can deliver quality education, maintain accreditation, and 
provide safe and adequate transportation for an estimated 3 
percent annual increase in enrollment. The BIA anticipates that 
between School Years 1996-97 and 1998-99, the student 
population will increase by more than 3,000.
    The budget provides an additional $3 million for operating 
grants to the 24 tribally controlled community colleges, which 
have been successful in providing college-age and adults with 
college degrees and eventual professional employment. It is 
also anticipated that this increase will support Tribal 
Community Colleges as they provide job training, continuing 
education and GED's to those seeking employment due to Public 
Law 104-193, the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996 (Welfare Reform).
    The budget includes trust investments crucial to saving 
additional costs in the out years. The BIA environmental 
management program is increased by $3 million to begin to 
address the backlog of environmental cleanup work, which is 
estimated at approximately $200 million. An additional $1.5 
million is needed for water rights studies and negotiation, as 
successful negotiations are always less costly than litigated 
claims. An additional $3.4 million is requested to address the 
backlogs in adjudication and certification of title and 
ownership to Indian lands. Until the backlog is eliminated, 
trust income cannot readily provide an accurate and timely 
reflection of account holders' land interests and related 
revenues.

                              construction

    The request for the BIA Construction appropriation is 
$125.1 million, with over one-third for Education Construction. 
In the last 2 years, the BIA has made progress in eliminating 
the unobligated balance in Construction facilities projects, 
mainly due to an increasing emphasis on tribal contracting for 
projects. The unobligated balance at the end of 1996 was the 
lowest in 5 years.
    The Replacement School Construction program funds the 
replacement of older, unsafe, and dilapidated schools on 
reservations according to a Congressionally approved priority 
list, which is currently limited to 16 schools. In fiscal year 
1998, $14 million is requested to construct the Many Farms High 
School in Arizona, the fourth school on the Priority List. The 
main facility was demolished due to structural building 
failure; therefore, the 400 children at Many Farms are 
attending school in portable trailers that are more than 17 
years old and have now deteriorated to the point where 
children's safety could be at risk. The Education Facilities 
Improvement and Repair Program is funded at $32 million and 
includes an increase of $8 million to continue to address the 
$682 million backlog of repair work in existing education 
facilities.
    The budget also requests $16.5 million, an increase of $12 
million above the fiscal year 1997 level, for Public Safety and 
Justice construction. This activity funds detention centers on 
reservations and fire protection safeguards in schools and 
other facilities. Tribes cite law enforcement as a top 
priority; without adequate reservation detention facilities, 
offenders are prematurely released into the community. An 
increase of $2 million is requested for facility improvement 
and repair of existing detention facilities. The budget also 
includes $9.1 million for replacement of the Ute Mountain Ute 
Detention Facility in Colorado and $1 million to complete the 
design of the facility to replace the Salt River Detention 
Center in Arizona. Inmates of the current Ute facility are 
housed in a building so overcrowded that the health and safety 
of the inmates are a serious concern. A recent consent decree 
requires the BIA to immediately address the overcrowded 
conditions at the Ute facility.
    The budget includes $22 million, an increase of $4 million 
over fiscal year 1997, for the correction of structural 
deficiencies of high hazard dams on Indian lands. The backlog 
of repairs to hazardous dams currently exceeds $400 million. In 
fiscal year 1998, the BIA will begin correction of high risk 
problems on dams in Wyoming, New Mexico, and Montana.

   indian land and water claim settlements and miscellaneous payments

    The program provides payments to meet Federal requirements 
for legislated settlements. The fiscal year 1998 budget request 
includes $59.4 million for payments for settlements resolving 
long standing tribal claims to water and lands. A large portion 
of the fiscal year 1998 request is dedicated to the Ute Indian 
Rights Settlement, in order to move closer to the funding 
schedule set forth in the settlement.

           tribal shares and the national performance review

    The centerpiece of the National Performance Review 
Reinventing Government Phase II in the BIA is the tribal shares 
process. Along with the negotiated rulemaking process for self-
governance compacts and self-determination contracts, the 
tribal shares process is the mechanism that the BIA is using to 
accelerate the transfer of program operations to tribes and, 
ultimately, to downsize and restructure the BIA. The tribal 
shares process builds on the Administration's commitment to the 
policy of self-determination and local decisionmaking.
    The first attempt to implement tribal shares was completed 
by a BIA team in February 1996. However, the process was 
delayed because consultation meetings with tribes revealed that 
tribes wanted full tribal participation in reviewing and 
determining inherently federal functions and their costs. The 
tribes feared that additional dollars identified for tribal 
shares would again be taken by the Congress for budget 
reductions as had occurred in fiscal year 1996. Tribes were 
also disappointed by the relatively small amount of funding 
being made available for tribal shares which offered little 
financial incentive to choose to contract/compact BIA programs. 
Some small tribes were also concerned about the diminishing 
amount of resources available to provide for tribes which did 
not contract services from the BIA.
    Since September 1996 the Deputy Commissioner authorized and 
directed the election of 24 tribal representatives, two from 
each of the 12 areas, to serve as members of a tribal workgroup 
to establish a mutually agreeable tribal shares determination 
process in partnership with the Bureau. The joint federal/
tribal workgroup recently met and achieved consensus on their 
plan to publish a list of inherently federal functions in the 
Federal Register by May 1, 1997. During the 90-day comment 
period, May 1-August 1, 1997, three regional tribal 
consultation meetings will be scheduled to obtain feedback and 
explain the list of functions. A revised list of inherently 
federal functions will be published as final in September 1997. 
The next phase of the tribal shares process is the 
identification of the costs associated with performance of the 
inherently federal functions, as well as the costs associated 
with functions available for contracting. The projected 
completion date is May 1998.

                 government performance and results act

    As required by the Government Performance and Results Act 
(GPRA) of 1993 (Public Law 103-62), the BIA intends to submit a 
final strategic plan to the Congress by the end of fiscal year 
1997. Based on a multitude of statutes, court rulings and 
treaty obligations, the plan will define the Bureau's long-term 
mission, broad goals and objectives. The program goals and 
objectives reflected within the budget justifications support 
these broad goals. In fiscal year 1998, the BIA will complete 
the fiscal year 1999 annual performance plan which will expand 
upon these programs goals by adding performance measures. These 
performance measures will help indicate the BIA's progress in 
meeting its mission as set forth in the strategic plan.
    The BIA has made progress in implementing a GPRA pilot 
project for forestry and ecosystem restoration in the Pacific 
Northwest. The project's strategy included tribal participation 
in prioritizing projects which has resulted in a noticeable 
improvement in the tribe's satisfaction with funding 
distribution. The BIA is continuing to refine its methodology 
of collecting accurate data to measure overall project 
performance.

                               conclusion

    The funds requested in the President's fiscal year 1998 
budget are critical to the health and well-being of tribal 
communities, tribal governments, and the tribal resource base. 
This funding will allow the Government as trustee to fulfill 
trust obligations and reduce the liability for failure to meet 
legally defined trust obligations.
    This concludes my opening comments. My staff and I would be 
happy to respond to your questions.

                 sources of money for tribal government

    Senator Gorton. Thank you, and let me say before I begin my 
questions that, at least for myself, I am quite favorably 
impressed with the changes that you have made, not only in your 
administration, but with respect to tribal shares, over the 
period of your time here. You have a right to be proud of a 
great deal of what you have done, because much of it is not 
just purely administrative, but based on a set of theories.
    I would like you to go over once again those sets of 
figures of the sources of money for tribal governments and 
exactly what services it is that they cover. Would you read 
that for me?
    Ms. Deer. Level of tribal investment in various tribal 
government operations?
    Senator Gorton. Yes, yes.
    Ms. Deer. In comparison to the Federal contribution?
    Senator Gorton. Yes; that is what I am after.
    Ms. Deer [reading]:

    While there are some differences between the accounting 
methodologies used by Federal and tribal governments 
respectively, we were able to produce a reasonably reliable 
snapshot based on information in the single audit reports filed 
by the tribal governments. We reviewed the expenditures 
documented by 192 tribes in these reports. The total came to 
$1.3 billion.
    You may be surprised to learn that 45 percent of the total, 
or $593 million, came from the tribes' unrestricted general 
fund. The Department of the Interior contributed slightly less 
than 25 percent, or $324 million. The remaining 30 percent, or 
$399 million, came from other Federal and State sources.

    Senator Gorton. OK, that is what I would like to pursue. 
Those figures relate to the moneys expended by tribal 
governments on their governmental activities, am I correct in 
that understanding?
    Mr. McDivitt. Yes; that is correct.
    Senator Gorton. That does not include their expenditures on 
other activities, even though some of them may have been funded 
by the BIA? Or does that include all the distributions of 
moneys from the BIA to the tribes?
    Ms. Richardson. Mr. Chairman, it includes all expenditures 
from the BIA and Federal agencies to the tribes, the general 
fund expenditures of tribes' unrestricted funds. Then tribes 
have a special revenue fund and in the special revenue fund all 
of the Federal funds are accounted for, and State funds as 
well.
    Senator Gorton. Now, how, Ms. Deer--or any of your staff 
can answer this question if they wish--how do you determine at 
this point how much each tribe receives out of that fund?
    Ms. Manuel. Out of the special revenue fund or the general 
fund?
    Senator Gorton. The general fund.
    Ms. Manuel. We do not have any control over the general 
fund. These are typically funds that are generated from tribal 
enterprises.

                        tribal fund distribution

    Senator Gorton. No; I do not mean what the tribes are 
spending. I mean how do you determine--I have got the wrong 
question. How do you determine, of the money that we 
appropriate to BIA and that you distribute to the tribes, how 
do you determine how much each tribe gets?
    Ms. Manuel. Historically, the funding that has been 
allocated to tribes has been based on an old system that the 
Department and the Bureau had in place for several years called 
the Indian priority system, where the tribes in each location 
and each area establish what they felt was their need for 
funding on the basis of population, land base, forestry 
dollars. They looked at the number of forestry acres.
    There was a process that actually was followed which to 
this day when we look at funding for new tribes we take the 
same factors into consideration.
    So the funding was established years ago and it has been 
pretty constant. Tribes pretty much know what their base 
funding has been for the past several years.
    Senator Gorton. And is it affected at all by your 
individual agreements with individual tribes on tribal shares? 
Do those agreements guarantee a certain share?
    Ms. Manuel. They should not, but we are finding in some 
locations where, especially where you have multitribe agency 
situations where the tribes all share an agency and one of the 
tribes or two of the tribes may want their shares, there is a 
process that the superintendent and the area director have to 
undertake to ensure that, if they provide a share to the 
requesting tribe and it is a share of a program or an activity 
that is funded to benefit all the tribes in that agency, if 
they take their share there has to be a determination that the 
reduction in funding and resources will not impact or harm the 
remaining tribes who do not take their shares.
    Senator Gorton. Now, in making these determinations do you 
take into consideration the relative prosperity or poverty of 
the individual tribes, the income that the tribes are receiving 
from other sources?
    Ms. Manuel. No.
    Senator Gorton. You do not?
    Ms. Manuel. Not in determination of tribal shares. It is 
based strictly on what has traditionally been available to that 
tribe through the budget formulation process.
    Senator Gorton. Well, that leads me to a policy question 
for Ms. Deer. Through my State news clippings the other day I 
learned of a story about the Colville Tribe in north-central 
Washington. The thrust of the story is that the members of the 
tribes were going to meet on the following Saturday to 
determine how to distribute $10 million in gambling profits.
    They had four proposals that were going to be before them, 
I think all of which included distributions--or most of which 
included per capita distributions to the members.
    Is it appropriate, Ms. Deer, for us to consider the profits 
that tribes are making from gambling over and above the 
salaries they pay, in determining how much money the taxpayers 
of the United States should distribute to those tribes for 
their annual governmental activities? Should the tribes be 
required to put some of those profits into activities that 
demonstrate a degree of self-sufficiency in the case of those 
tribes that have gambling enterprises that make profits?
    Ms. Deer. As you know, Senator, the tribes must spend 
money, according to the Indian Gaming Regulatory Act, for 
tribal economic development, for improving the tribal welfare, 
for improving the quality of life on their reservations. They 
make contributions also to other governmental, and charitable 
purposes.
    I have not seen that particular article you are referring 
to, but the tribe must submit and receive permission to 
dispense these per capita payments.
    Senator Gorton. I am sorry? Must receive permission to do 
what from whom?
    Ms. Deer. There has to be a request made by the tribe. They 
must receive permission from the Secretary.
    Senator Gorton. In other words, from you.
    Ms. Deer. Well, it is just not me, but it is the whole 
process, yes, in order for the per capita payments to be 
distributed.
    I would point out that the States also have lotteries and 
that there is no, at this point as far as I know, no tie-in for 
dispersal of Federal funds in relation to the State lotteries. 
The tribes are opposed to that type of testing. The Bureau does 
administer some eligibility criteria in some of their programs, 
such as housing improvement and higher educational services and 
general assistance.
    So I think from your point of view it is a question that 
has arisen and would require some additional study and 
discussion in my opinion.
    Senator Gorton. Well, I have here the statute and one of 
the purposes for the use of those revenues, to quote from the 
statute, is to ``fund tribal government operations and 
programs.''
    Ms. Deer. That is true.
    Senator Gorton. Now, my question is whether or not your 
formula for distribution for government operations programs 
should not reflect those profits, so that more of your 
distributions would go to tribes that are isolated and do not 
have this form of income and less should go to those tribes 
that do have that, the ability to fund at least some of their 
governmental operations through gambling revenues.
    The answer was that you have got a formula that is an 
ancient formula, that has hardly ever changed. Should it not 
change in the light of these, these relatively new sources of 
income?
    Ms. Manuel. I think the IGRA does provide that opportunity, 
because if you look at the statute it does require that the 
Secretary be satisfied that the tribe--before we approve a 
revenuesharing per capita plan, we have to make a determination 
that in fact the tribe is spending--and we have established 
that to be at least one-half or 50 percent of whatever the 
gaming revenue is, for the purposes that are authorized in the 
statute, before they can distribute it as per capita.
    And I would certainly encourage my area directors to look 
at situations where, if there is a shortfall in tribal 
government funding and clearly the tribe has revenue from 
gaming that could offset that and they are not looking at 
spending it for offsetting their shortfall, we would have to 
take a real hard look at their per capita plan before it is 
approved.
    Senator Gorton. So that the last alternative I see here in 
this clipping, which says $8 million for per capital 
distribution and $2 million for government activities, would be 
unlikely to be approved?
    Ms. Manuel. That is right, that is right.
    Senator Gorton. We now have Senator Domenici here. Since I 
have a whole long lists of questions and I know that Senator 
Domenici is responsible for the whole budget, I am going to 
defer to him for any statement he has and any questions that he 
has.
    Senator Domenici. Sir, I would prefer that you go on maybe 
15 minutes.
    Senator Gorton. All right. Well, you tell me whenever it is 
that you would like to ask questions.
    Senator Domenici. May I just comment, however, on the one 
issue you have raised with reference to Indian profits from 
gaming. The one thing that is of concern to me in any effort to 
do a new formula is that we clearly should understand the great 
disparity, even among casinos and gambling profits.
    My State has been in a state of turmoil, as you know, as to 
whether or not our Indian casinos are legal or illegal. It has 
nothing to do with us. It has to do with State law. After many 
months of wrangling, they are going to make them legal.
    We have some that make very little money, some that make a 
lot of money, and I think it is all going to change.
    Senator Gorton. And some that are so isolated that they 
cannot do it at all.
    Senator Domenici. What bothers me is, if you get into a 
formula where you then have all those who do not have casino 
profits that are getting a certain amount, and then all of a 
sudden the gaming falls off and then you have got to change the 
amount they are getting. I think before we do anything like 
that we ought to be very careful to understand it.
    I also truly believe that, from the standpoint of Indian 
economic development, unless there is some big social damage 
occurring, gaming is a source of funding. People take one side 
or the other of that with reference to gambling all the time. 
It does seem to me, however, that Indian people have hit upon 
something that does give them an opportunity to raise their 
standards of living and to do some very exciting things for 
their people.
    Whatever one reads about the very, very wealthy, those who 
are making millions and millions of dollars, it is a lot 
different than my State. A lot of my casinos in New Mexico--
casinos in New Mexico; I should not say mine. I do not have 
anything to do with it. [Laughter.]
    Sometimes I refer to New Mexico that way, but I should stop 
that.
    In any event, a lot of gaming revenue is going for 
improvements. It is rather interesting. A couple of Pueblos 
have built some very exciting facilities for their people. They 
are very positive projects. I have not visited every one, but I 
have visited enough to say that there are some very 
responsible, in anybody's sense, uses of these funds for the 
Indian people.
    I think we need a little time to see how that works in 
States like mine, as compared with perhaps a few that have the 
biggest casinos in the world. I guess there is one up there on 
the east coast. So they are very different. I think the 
question is a legitimate one, but clearly I still believe it is 
a little premature to decide how to change gaming. I guess I 
would resist your efforts if you move that way this year.

                             tribal shares

    Senator Gorton. Ms. Deer, on this subject of tribal shares 
agreements and decentralization and greater authority on the 
part of the individual tribes, how far have you proceeded? How 
many tribes now have such agreements?
    Ms. Deer. Are you talking about tribal shares?
    Senator Gorton. Yes.
    Ms. Deer. That whole process has not been completed yet. 
Ms. Manuel, can you explain a little more about that? There 
have been many, many meetings on this.
    Ms. Manuel. We do not have any tribes that are taking their 
shares under the authority of title I of Public Law 93-638, 
which is the contracting self-determination part. We do have, 
as you know, about I believe 60 tribes that take their shares 
under self-governance. In other words, they have negotiated 
self-governance compacts and are now in the self-governance 
program.
    As I reported, I believe a year ago, we were looking at 
having completed the tribal shares process, where we have 
clearly identified inherently governmental functions or 
inherently Federal functions, identified the contractable, 
compactable activities and functions in a very detailed manner. 
That process has been further delayed by actually the tribes 
themselves.
    I established a work group in July of last year to ask them 
to provide us assistance and to work with us in developing this 
final process to enable the tribes that had indicated at that 
time their desires to take their shares under the 638 title I 
section. They have spent--the tribal work group, which consists 
of two representatives from each of our 12 areas, tribal 
leaders, who sit on this work group, in turn established a 
smaller work group to work with Bureau staff in trying to come 
to some final closure on the tribal shares process.
    Last month in Albuquerque, the complete work group met, 
heard from the subwork group, and determined that they were 
still at least 2 years away from completing and coming to some 
final tribal shares process.
    What we are going to do, and in fact, I believe in May, we 
are taking to the Federal Register a notice to the public of a 
preliminary list of inherently Federal functions, what we, 
working through the tribal work group, have identified as 
inherently Federal or inherently governmental functions, that 
will be published for public comment.
    Senator Gorton. So you do not need any further authority, 
then? Only 60 tribes take their shares, and you have got a 
process that is going to take another couple of years. I think 
in each of the last 2 years we have expanded the number of 
tribes.
    Ms. Manuel. I do not believe we have.
    Senator Gorton. You do not need any additional authority in 
that connection?
    Ms. Manuel. No; I think the authority we have now under 
title IV is sufficient. We expect that we will probably have at 
least 10 more tribes. The 60 compacts do represent 200-plus 
tribes.
    Senator Gorton. That is right, OK. But you have enough 
authority?
    Ms. Manuel. Yes; that is right.
    Senator Gorton. You are not going to need any more from us 
this year?
    Ms. Manuel. That is right, no.
    Senator Gorton. Now, you have already anticipated my next 
question, something that Ms. Deer referred to. What is an 
inherently Federal function? Is it a short enough list so you 
can tell me right here what you are going to publish among 
those functions that you think are essentially Federal?
    Ms. Manuel. No; it is not short enough. That is why we want 
to publish the list, because I am sure there are probably 
functions or activities that we did not think of and the public 
will have the opportunity to come and let us know. And even the 
definition has created some great debate and discussion within 
the tribal work group, within the Federal work group, and I 
believe even the solicitor's opinion has not been that specific 
or clear, and in fact has referred us to a number of 
governmental publications out of OMB that define how you look 
at and determine what is inherently Federal.
    But simply, the easiest response is it is those functions 
which by statute or even judicial opinion can be performed only 
by a Federal official and cannot be delegated to anyone other 
than a Federal official.
    Senator Gorton. So you do see a permanent and significant 
Bureau of Indian Affairs?
    Ms. Manuel. Yes.
    Senator Gorton. You do not see the end of this process 
being one in which there is a set of formulas or block grants 
pursuant to which aid goes directly from the Congress to each 
individual tribe and each individual tribe makes all of its own 
decisions? That is not the end process?
    Ms. Manuel. No; in fact, as you know, Indian tribes and 
Indian affairs is the most regulated business in the Federal 
Government. There are just hundreds and hundreds of statutes 
that impose some statutory requirement on the Secretary.
    Senator Gorton. Sure, but those statutes could be repealed.
    Ms. Manuel. Most are based either in treaty or have some 
historical foundation that is based in the political 
relationship between tribes and the United States.
    Senator Gorton. So you do not see any time in the future in 
which either the bill that Senator McCain had last year from 
the Indian Affairs Committee or a simple block grant proposal 
that we had briefly in this bill last year would be 
appropriate? The administration is not going to recommend any 
fundamental statutory changes in the relationships between the 
Federal Government and the tribes?
    Ms. Manuel. I think there will be fundamental changes in 
how the Bureau conducts business as tribes become more 
sophisticated and progressive and take on the noninherently 
Federal activities and functions. You are going to see, I 
think, a much more streamlined organization that I think will 
be comprised of purely professional technical skills and 
abilities that are going to be there to provide technical 
assistance to tribes.
    You are not going to see the Bureau of Indian Affairs of 10 
years ago, where you had 15, 16,000 employees and the Bureau 
did pretty much everything for tribes. They ran the courts, 
they ran the police, they ran the social services program. I 
think you are not going to see that kind of an organization.
    Senator Gorton. I have just been informed that Senator 
McCain is reintroducing his bill today. Assuming that it is the 
same bill as it was 2 years ago, will the attitude of the 
Secretary and the Bureau be identical to what it was a year 
ago?
    Ms. Manuel. From the Bureau's perspective, the concept of 
developing a Bureau with the active participation of the tribes 
is something that we believe in and we are doing for the tribal 
shares process. The only aspect of the bill that concerned me 
was the many layering of consultations and compacts that were 
required, and if the bill is identical I would have great 
problems supporting it.
    Ms. Deer. Mr. Chair.
    Senator Gorton. Yes?
    Ms. Deer. I would like to mention that at the meeting of 
the tribes, the President and the Cabinet on April 29, 1994, 
the President did reaffirm the government-to-government 
relationship between the Federal Government and the tribes. So 
I think that that outlines the basic thrust of the 
administration toward the tribes to reaffirm the government-to-
government relationship.
    Senator Gorton. But you are not going to propose a 
statutory change like Senator McCain's? We are going to get 
nothing from you with respect to fundamental statutory change?
    Ms. Deer. I doubt it.
    Senator Gorton. OK.
    Senator Domenici.
    Senator Domenici. Yes.
    Senator Gorton. I have finished my questions on this 
subject matter area, so if you have some.
    Senator Domenici. I thank you. Thank you very much, Mr. 
Chairman.

                          education facilities

    I want to talk just for 1 minute and also share with you a 
concern. You know, in America we all say the gateway to the 
future is in education, and that opportunity is closely linked. 
Frankly, one of the biggest shortcomings that we are foisting 
on young Indian people is the inferiority of the Bureau of 
Indian Affairs school system that they run for the young Indian 
people. Not all of them, I understand.
    First I have four or five questions, just to make my case, 
of individual schools run by the BIA where I have had to 
intervene, or a school is left half built, or dormitories that 
are patently necessary way out in Navajo country are not built, 
so the school does not work.
    Now, it seems to me that there is an awful lot of money 
being spent sort of running in place and making legal decisions 
and determining the nuances of relationships, while in Indian 
country among the Indian people the education plant is falling 
apart. Now, is anybody here capable of telling us the current 
evaluation of what is needed to bring just physical plants--do 
not worry about whether we get enough teachers--just to bring 
them up to standards that others are living under in the United 
States? How much is that?
    Is my recollection of $700 million for dilapidated 
buildings and inferior, second-rate schools and dormitories, 
correct? Is that a fair number?
    What is your name, sir?
    Mr. Schweigert. Jerry Schweigert. I am the Director, Acting 
Director, of the old Office of Construction Management. Now we 
are the facilities transition program staff.
    Yes, we did, for the 1998 budget, we ran a new inventory or 
updated our inventory, and we found that to bring all of our 
facilities up the standards, codes and standards, it would cost 
approximately $890 million.
    Senator Domenici. So close to $1 billion?
    Mr. Schweigert. That is correct, sir.
    Senator Domenici. I have heard a couple of Senators who had 
a chance to go out and visit Indian schools on their 
reservations. Maybe you have, too, Mr. Chairman. I am talking 
about the dilapidated condition of a school and just its total 
inferiority. I heard one Dakota Senator speak about that. I was 
wondering whether anybody could get educated in that kind of 
facility.
    This issue causes me a great deal of concern. I will say, I 
am not terribly impressed with the President's budget, asking 
for $5 billion for here and there new construction of schools 
around the country, when the one school system that, for better 
or for worse, that we are responsible for does not even have 
adequate buildings to educate young Indian people. I do not 
think you have got a budget to take care of anything like that.
    We are not even making any headway on the priority list on 
education. It is longer rather than shorter each year that you 
fulfill the top five or six requests. Is that a fair 
assessment?
    Mr. Schweigert. Well, as the buildings age, currently we 
have 63 percent of our buildings that are over 30 years of age 
and 26 percent that are over 50 years of age. Normally we 
design the life of a building around 30 years. So our buildings 
are basically aging and 80 percent of them are education 
related. So as our buildings age, they escalate in 
deterioration. So the older they get, the faster they 
deteriorate.
    Senator Gorton. Excuse me. Can I interrupt?
    Senator Domenici. Of course.
    Senator Gorton. Does that 30 year rule and 30 year and 50 
year percentages represent a different set of standards from 
public schools in most of the 50 States? Aren't a majority of 
all of our schools over 30 years old?
    Mr. Schweigert. Normally our facilities are designed and 
built along the same codes and standards as public schools are.
    Senator Domenici. That was not his question.
    Senator Gorton. That really was not my question. Are not 
most public schools more than 30 years old?
    Mr. Schweigert. I have no idea, sir, on that.
    Senator Domenici. I think for a number of reasons that is a 
relevant question. You might want to plug that in and see if 
somebody in the Department of Education knows. I will bet they 
do. I think that does give us another set of facts that we 
would want to explore.
    Nonetheless, the kids, they are the ones at the bottom of 
this that have to get helped. They are not getting the right 
education. So we have got to work on that issue.
    I have two or three education issues that I want to raise, 
as I indicated. I do not like to do this and I wish the system 
was running so we would not be up here doing this, so I would 
not be in a subcommittee saying fund this particular school 
even though it is not on the priority list because we ought not 
be running a school system as broad as that in my opinion. I 
think you agree with that, Mr. Chairman.
    Senator Gorton. I certainly do.
    Senator Domenici. I am going to just tick them off for you, 
and I would appreciate an answer for the record from whomever 
is qualified. Santa Clara Day School, this remains two-thirds 
completed. Last month I raised the issue with you, Madam 
Secretary, and I pointed out that the school was a monument to 
the incompetence--and I say this very, very forthrightly--to 
the incompetence of the Bureau of Indian Affairs and its 
monumental bureaucracy.
    Somehow or another, somebody has been able to identify 
$300,000. Apparently it needs $900,000 to get finished, and I 
would ask you to explain for the record what the situation is.
    [The information follows:]
                         Santa Clara Day School
    A Public Law 93-638 contract was awarded to the Pueblo of Santa 
Clara on December 19, 1991, in the amount of $1,312,041. The funds were 
authorized for the renovation and expansion of the existing day school 
serving grades Kindergarten through 6th grade.
    Additional funds for phase 2 were requested by the Bureau and were 
received in the fiscal year 1995 appropriations to complete the 
project. Subsequent contract modifications including phase 2 funding 
resulted in a revised contract award amount of $3,416,123. The phase 2 
funding was requested from Congress based on the Tribe's Architect's 
estimate of what it would cost to complete all work on the project. 
However, when the Tribe awarded the construction subcontract in 
November 1995, the total combined appropriation was insufficient to 
complete all of the work in the project. The Tribe awarded the 
subcontract at an amount which exceeded the Architect's estimate by 
$643,064 or 23 percent. The Tribe has been pursuing additional funds 
estimated at $1.2 million to complete the renovation project.
    The fiscal year 1997 Senate Report contained the following 
direction: ``The Committee urges the BIA to continue its efforts to 
settle the dispute over funding for the facilities improvement and 
repair at the Santa Clara Day School.''
    Working with the Tribe's planning administrator, FMCC provided an 
additional $315,000 on March 4, 1997, based on items of work that were 
felt to be absolutely necessary and were related to safety and health 
conditions. In addition, in a letter dated March 3, 1997, from the 
Director, FMCC 997 letter to the Tribe, the Tribe was requested to 
provide additional information so that a final decision on additional 
funding could be made by FMCC. The information requested has not been 
received as of May 19, 1997. The tribe has requested additional items 
of work that were outside Congressional authorization and are not 
safety and health related.
    The construction appropriation does not have funds to cover these 
costs in today's environment of constrained budgets. The major item in 
the Tribe's request is a new gymnasium. The Tribe has a community 
center, with gym, across the street from the school which the school 
has been using for physical education. Although unobligated balances 
exist in the Facilities Improvement and Repair Program, funds are 
already committed to specific projects which were justified in prior 
budget requests.
    In addition to the $315,000 indicated above, FMCC will make 
available to the Tribe, at no cost, new surplus equipment and 
furnishings from completed school construction projects. We have made 
the offer to the Tribe and the Tribe is working with FMCC staff to 
determine if what we have available will meet the needs of the school.
Conclusion
    FMCC could potentially provide an additional amount up to $185,000 
without seeking reprogramming authority from Congress and without 
impacting other funded projects, but does not have the remaining 
$700,000 for non-health and safety requirements.

                       mescalero apache proposal

    Senator Domenici. I have another. Again, I do not know why 
I should have to do these, but one of the tribes in New Mexico 
that ranks high in good management is the Mescalero Apaches, 
Wendell Chino's tribe. I think when they have a good idea you 
ought to give it serious thought. They want to put a manager in 
to manage all the programs of the Bureau that apply to them. 
They have had great success whenever they have had management 
in their various industries and businesses. I urge you to 
consider that request, and I am submitting for the record for 
you to review a letter with attached documents from Wendell 
Chino indicating why they think this is a good idea. Would you 
take a look at that, please?
    [The information follows:]

                       Mescalero Apache Proposal

    The Tribe proposes to contract for the Superintendent's 
position without assuming responsibility for all agency 
positions and responsibilities. This would create a situation 
where federal employees were being supervised by a person other 
than a federal employee and would violate federal personnel 
laws.
    The Superintendent provides direct service to the Tribe 
and, in addition, supervises federal employees, has other 
federal responsibilities and reports to the Albuquerque Area 
Director. Consequently, if contracting were to occur based on 
the Tribe's current proposal, in order to comply with federal 
law, it would be necessary for the Bureau to retain federal 
supervision over federal employees by withholding the 
supervisory portion of the Superintendent's responsibilities 
from the contract, and placing that function with another 
federal employee.
                                ------                                

                       Letter From Wendell Chino
                                    Mescalero Apache Tribe,
                                      Mescalero, NM, April 9, 1997.
Hon. Pete V. Domenici,
U.S. Senate,
Washington, DC.
    Dear Senator Domenici: Mescalero Apache Tribe is in the process of 
attempting to contract the Superintendent's position at Mescalero 
Indian Agency. In place of the superintendent we want to hire a manager 
so we can breathe new life and innovation into the agency with a 
manager.
    For years as you know, we have utilized several managerial 
positions with our Tribal enterprises and they have proven highly 
successful. We believe it is time we applied the same concept and 
principle with just one position under contract at Mescalero. All of 
the trust obligations and responsibilities remain with the Bureau of 
Indian Affairs through the remaining positions and branches at the 
Mescalero Indian Agency.
    Enclosed is a position paper we developed regarding the proposed 
agency manager. We are enclosing a copy of the pertinent code of 
Federal Regulations which allows for a contract of all or part of the 
Bureau Programs in Mescalero.
    We trust that you will support our efforts to contract the 
position. In addition we hope you will convey to the Secretary of 
Interior about our new concept that can make the Bureau of Indian 
Affairs highly successful on an Indian reservation.
            Very truly yours,
                                          Wendell Chino, President.
                                 ______
                                 

                             Agency Manager

                             scope of work

    The scope of this contract will establish a managerial 
position between the Mescalero Apache Tribe and the Bureau of 
Indian Affairs. This position will manage the work force of the 
Mescalero Apache Agency and will be responsible for its day to 
day operation.
    The Agency Manager will coordinate all activities which 
contribute to the accomplishment of the Bureau of Indian 
Affairs mission statement. Much of this will be accomplished by 
the management of the Agency Branch chiefs as they carry out 
the trust responsibility of the Federal Government.

                        the agency manager will

    Maintain an Official relationship between the Federal 
government and the Tribe, providing programs and services in 
this capacity develops and fosters a positive relationship 
between the Tribe and the Bureau which supports a co-equal 
partnership arrangement in carrying out all governmental Trust 
and program responsibilities of the Bureau to the Tribe and its 
people.
    Responsible to the Tribe for the Trust and program work of 
the agency branch chief and the federal employees they 
supervise. The Agency Manager administers these programs and 
services in accordance with Federal Laws, regulations, 
policies, procedures, and guidelines and has the authority to 
use discretion concerning the uses of all government resources 
(dollars, manpower, facilities, supplies and materials); 
establishes internal policies, and controls all program and 
activities in a manner which will best benefit the Tribe and 
its people.
    Reviews the planning, organizing, coordinating, operating, 
evaluating, and controlling actions taken and recommendations 
submitted by immediate subordinates to assure compliance with 
technical, managerial and administrative requirements. Reviews 
justifications for resources such as personnel, funds, 
equipment or facilities; compares them with other requirements; 
and endorses, modifies, or rejects them as considered 
appropriate. Also, reviews a variety of progress reports, 
status records, comments of tribal and bureau and management 
officials and similar data to ensure that assigned functional 
objectives are being achieved.
    The Agency Manager is to justify, defend, negotiate or 
settle matters involving significant or controversial issues. 
This usually involves active participation in conferences, 
meetings, hearings, or presentations involving problems or 
issues of considerable consequences or importance. The 
manager's contacts usually have diverse viewpoints or 
objectives requiring the manager to achieve a common 
understanding of the problems and a satisfactory solution by 
convincing them, arriving at a compromise, or developing 
suitable alternatives.
    Based on knowledge and understanding of tribal goals, 
priorities, and needs determines the kinds and scope of 
programs and services to be provided by the Agency. Determines 
results to be achieved. Develops policies, rules, and 
procedures to carry out operations, organizes work into 
manageable units and allocated resources to each. Discusses 
proposed final plans with the Tribal President and make 
modifications as necessary.
    The Agency Manager is the official responsible for settling 
disputes, negotiating joint ventures and finding solutions to 
complex problems between the Tribe, Federal Agencies, State 
Government and private enterprises.
    The Agency Manager will direct the planning, organization 
staffing, and budgeting of the total Federal Government 
operation which provides a variety of programs and services; 
identify its goals, priorities, policy, guidelines and 
procedures; and determines, identifies, and procures the 
support necessary for implementation.
    The Agency Manager will be supervised by the Tribal 
President and receive advise, counsel, and analysis from the 
Area Director or his staff.
    The Agency Manager will have signature authority for all 
personnel actions, payroll, and leave.
    The Agency Manager will be responsible for the faithful and 
efficient discharge of the Federal Government's 
responsibilities to the Mescalero Apache People in accordance 
with established laws and approved policies, objectives, and 
standards, and for the protection and sound management for the 
extensive resources and funds held in trust by the United 
States Government for the Tribe as well as individual tribal 
members.
    The Agency Manager will supervise with the idea, of 
managing all functions through subordinate staff and allow the 
subordinate staff to have the latitude to manage their 
respective programs. This latitude will provide greater 
stability, span of control and confidence to supervisors giving 
them the ability to be more effective.
                                ------                                


                     Subpart B--Application Process

Sec. 271.11 ELIGIBLE APPLICANTS.

    Any tribal organization is eligible to apply for a contract 
or contracts with the Bureau to plan, conduct, and administer 
all or parts of Bureau programs under section 102 of the Act. 
However, before the Bureau can enter into a contract with a 
tribal organization. It must be requested to do so by the 
Indian tribe or tribes to be served by the contract in 
accordance with Sec. 271.18.

Sec. 271.12 CONTRACTABLE BUREAU PROGRAMS.

    (a) Tribal organizations are entitled to contract with the 
Bureau to plan, conduct, and administer all or parts of any 
program which the Bureau is authorized to administer for the 
benefit of Indians. All or parts of any program include:
    (1) Any part of a Bureau program which is divisible from 
the remainder of the program so long as the contract does not 
significantly reduce benefits to Indians served by the 
noncontracted part(s) of the program. However, to the extent 
that it is within the Bureau's existing authority and the 
program or part thereof involves only one tribe and one Bureau 
Agency or Area Office, the benefits provided to Indians by the 
non-contracted part(s) of the program may be reduced at the 
request of the tribe. When the program or part thereof serves 
more than one tribe, the benefits provided by the non-
contracted part(s) of the program may be reduced when all of 
the tribes served consent to a reduction.
    (2) A single employee position only when the functions to 
be performed provide a direct service to Indians and meets the 
criteria in paragraph (a) of this section.
    (3) Programs or parts of programs or services that are 
authorized but not currently operated or provided by the 
Bureau.
    (4) Operation of, or services provided by, previously 
private schools.
    (5) Alterations and repairs in direct support of a 
contracted program. Individual construction projects are not 
contracted under title I of the act, but can be contracted 
under other authorities.
    (6) Architect and engineer services.
    (b) Paragraph (a) of this section also applies to trust 
resources programs or portions thereof. Additional criteria for 
contractable trust resources programs, or portions thereof are 
given in Sec. 271.32.
    [40 FR 51286, Nov. 4, 1975, as amended at 43 FR 37440, Aug. 
23, 1978.]

                               education

    Senator Domenici. I was in error. On the school that is 
two-thirds completed, you found $300,000 but the total needed 
is $1.2 million. So they are still $900,000 short.
    There is a very serious dormitory problem on the Navajo 
Nation. They have made a request with an inventory. I am very 
hopeful that you will take a look at that and give us your 
recommendations.
    I want to share another thought with the chairman. I do not 
know what to do about it, but we are in the process of taking 
an inventory of the Indian colleges and community colleges and 
post-high school institutions that we are in some way obligated 
to pay for, and it is absolutely amazing. On the one hand, we 
have some that we fund on par with what it costs to run a 
reasonably good, comparable non-Indian college. But we have 
these college institutions going up and some of the funding is, 
on just a rough analysis, $5,400 per student count is about 
average elsewhere, and we are funding them at $2,900.
    I do not know how anybody would expect to run a first class 
institution, unless the $5,400 is outrageous, and I do not 
imagine it is 100 percent outrageous. Maybe 30 or 20 percent, 
but not 100 percent. So I just share that here is another area 
where here we are encouraging our young Indian people to go to 
those schools, and they have got to be inferior by definition.

                           laguna industries

    I have one last issue, since you have invited me to take my 
turn and use your valuable time. I want to talk about the 
Laguna Industries in New Mexico. Are any of you aware of that? 
Do you know something about it?
    Ms. Manuel. Yes.
    Senator Domenici. Laguna Industries is one of the best 
success stories of an Indian group setting up a business, 
employing their own people, and doing some big time contracting 
with the U.S. Department of Defense. They are in the process of 
refinancing, and I would urge that you take a look at what is 
being recommended with reference to the refinancing package and 
seriously consider what might happen to that industry if the 
current financing is not continued in some way as you put a 
final package together.
    They have a huge backlog of jobs. Their management is back 
in shape. They employ over 500 Indian people in good jobs. I 
would very much like you to take a look at that situation. They 
have $40 million in backlog of contracts. I do not want to see 
somebody trying to make a point up here in the bureaucracy that 
they are smarter than the banks and that they know what is best 
when there is a market out there. I would hope you will take a 
look at this issue.
    Ms. Manuel. We have been working very closely with Laguna 
Industries and the bank. There is now a new bank involved. 
There were a lot of problems that we have worked through with 
the tribe and the management at Laguna Industries, and I think 
as of last week my understanding is that everyone was on board 
and we were going to be able to do what the tribe wanted.
    Senator Domenici. Well, I would hope then that you would 
take another look, will you, because I think it is not done. 
There is a proposal.
    Ms. Manuel. OK.

                               education

    Senator Domenici. Mr. Chairman, I hate to bother you with 
these kind of questions when you have the whole budget of this 
committee to put together, but this is a big piece of it. I 
thank you for the time.
    Senator Gorton. Well, Senator Domenici, even on my own list 
of questions here, the next ones were all on education. If you 
want to stay around for that, I can follow up and supplement 
yours. And if the education gentleman wants to take a seat up 
here again, that would be appropriate.
    First let me just ask you a factual question. Of all of the 
Indians of school age who live on reservations, what share, 
what percentage, what number, attend Indian schools and what 
number attend the regular public schools of the States in which 
those reservations are located?
    Ms. Morris. I do not have the figures for the 23 States 
where schools are located. Nationally, Indian students comprise 
85 percent of the public schools, 10 percent of BIA schools, 
and about 5 percent are in church or Catholic, various 
denominational schools.
    Senator Gorton. Roughly, when we are speaking about this 
budget and this money we are speaking about schools for about 
10 percent of the Indians?
    Ms. Morris. Ten percent.
    Senator Gorton. Are those schools usually in relatively 
isolated places?
    Ms. Morris. Yes; consistently.
    Senator Gorton. I am curious. I had a very parochial 
question before you came, Mr. Chairman. Ms. Deer was talking 
about the magnificent Leschi High School in the State of 
Washington, which has recently been completed and which I 
visited and which is a wonderful facility. It certainly is not 
isolated. It is about 1 mile from the city limits of the city 
of Tacoma.
    How do you set your priorities with respect to construction 
funds in Indian schools? Have we done that for you? Have we 
just told you which ones you are going to do, as against 
letting BIA make that determination itself?
    Ms. Morris. Mr. Schweigert handles the construction money.
    Mr. Schweigert. We do set the priorities, Senator. Those 
schools were prioritized in fiscal year 1992-93, and then in 
1993 Congress basically froze the 16 that were on the Federal 
Register. The prioritization goes back to about 1979, when the 
Bureau worked out the process with Congress which basically 
determined that the highest ranking factor would be unhoused 
students. Those students at Chief Leschi were basically 
unhoused when their school was condemned.
    Senator Gorton. The previous school.
    Mr. Schweigert. So they competed, and in 1993 when we went 
through the process and only five schools were eventually put 
on the Federal Register, 66 schools actually applied and would 
have been eligible, but the criteria has weighting factors that 
were determinative.
    Senator Gorton. How many of those five schools or the 
earlier 16 are still on a priority list? Are some of them under 
construction? Would the others still be priorities?
    Mr. Schweigert. Well, we basically froze the 1992-93 list, 
and so far we have built seven schools, and Chief Leschi was 
the last. We have nine more schools to go and that includes 
Many Farms, which was in the 1997, is now in the 1998 list as 
well.
    Senator Gorton. Does this budget have enough money in it 
for the completion of that school?
    Mr. Schweigert. Many Farms, yes. We put $14 million in the 
1998 budget, yes.
    Senator Gorton. Senator Domenici, you came up with that 
figure of $890 million on the backlog of school facilities. My 
notes say that there is another $400 million backlogged on dam 
repairs and $2 billion for irrigation projects. And the whole 
budget request for facilities construction is less than $74 
million out of that $2 billion, which certainly supports the 
point you made earlier.
    In addition, assuming you get that $74 million, how much of 
the funds that have already been appropriated are still 
unobligated, for all kinds of construction projects?
    Mr. Schweigert. Well, for education we have a little over 
$100 million currently unobligated. Those are all earmarked for 
specific projects.
    Senator Gorton. All on that list of 16?
    Mr. Schweigert. No; Many Farms is the only one.
    Senator Gorton. The rest is for rehabilitation?
    Mr. Schweigert. FI&R, facilities improvement and repair 
projects that go back several years. And with 638 and self-
determination regulations, we deal with the tribes and a great 
many of those projects are joint efforts between the tribes and 
the government, and it takes a while to get them designed and 
constructed.
    Senator Gorton. So would it be fair to say that with 
respect to the moneys that you have and are seeking now, the 
higher priority is for repair and rehabilitation than for new 
construction?
    Mr. Schweigert. Well, in the current budget, we have a much 
higher figure, $30 million-plus for facilities improvement and 
repair, versus $14 million for new construction, yes.
    Senator Gorton. And can I infer from your previous answer 
that, in addition to the money that we appropriate, that 
various tribes make contributions of their own to both 
construction and repair and rehabilitation projects?
    Mr. Schweigert. We have had several schools in Wisconsin 
that have built their own schools, but normally that is not the 
case.
    Senator Gorton. Either on construction or on improvement 
and repair?
    Mr. Schweigert. We supply the money for the schools, 
basically.
    Senator Gorton. How do you balance priorities? You have the 
frozen priority list for construction. How do you set up your 
priorities for repair and rehabilitation?
    Mr. Schweigert. We have an automated system. First of all, 
we have a backlog and our backlog is an amalgam of items that 
are comprised of codes and standards, national codes and 
standards such as the National Fire Code and so forth, and 
those are determined and put in a backlog by building. So we 
develop a program of requirements, the areas and agencies 
develop.
    On an annual basis they put their program of requirements 
in, and we have an automated system. We have an automated 
computer system that ranks all of these program of requirements 
that ultimately become projects, and it is a weighted average 
based on such things as the age of the students, the condition 
of the building, whether it is a fire code versus a structural, 
and things such as that.
    Senator Gorton. How much money have you actually spent on 
the repair and rehabilitation of Indian schools in the last 
year?
    Mr. Schweigert. Last year I think we spent $56 million.
    Senator Gorton. That's not much of a dent on the deferred 
maintenance, is it, or on the necessary repair and 
rehabilitation?
    Mr. Schweigert. Not if you consider that we have $890 
million, no.
    Senator Gorton. No.
    Ms. Deer, perhaps this is an inappropriate question for 
you, but do you have the slightest idea when the President is 
going to appoint a successor to you?
    Ms. Deer. Various names are in contention and so far no one 
has been officially announced.
    Senator Gorton. And have you agreed to stay on until your 
successor is nominated and confirmed?
    Ms. Deer. Confirmed, yes.
    Senator Gorton. So there will not be a vacancy.
    Ms. Deer. So we will have continuity, yes.
    Senator Gorton. My other subcommittee, Transportation, has 
the budget for Federal Aviation Administration and it is not as 
fortunate as the BIA. We have been waiting a long time for a 
successor to the leadership position.

                       law enforcement facilities

    Briefly, would you answer some of the same kinds of 
questions that you have answered now with respect to schools in 
connection with justice facilities: what your backlog is, what 
you are doing about the backlog, how you set priorities?
    Mr. Schweigert. Yes, I can, Senator. We have 34 justice 
facilities that we have responsibility for. We have 
approximately $112 million, $112 million it would take to do 
the repair or replacement of those facilities. Currently in our 
latest inventory we say that 13 of those facilities should be 
replaced.
    I do not have the exact figures in my head, but I think it 
was around $27 million. It was around $27 million to replace 
those facilities.
    Senator Gorton. My notes say that the budget has just over 
$2.5 million for existing public safety and justice facilities, 
so that would be about 10 percent of your backlog?
    Mr. Schweigert. Well, what we have is the 34 facilities, 
and we have 13 that we indicate--$34 million, my correction, 
$34.2 million that we should have replaced. The renovation of 
the 21 remaining facilities would be $22.7 million, and it 
would cost us approximately $5.7 million for planning and 
design.
    However, if we were to take those facilities and actually 
build them to the size that they should be, it would cost us 
approximately $112.7 million. So what I am using as the figures 
for replacement of the 13 is basically the same size as we 
currently have there that exist, not taking into consideration 
that they should be larger.
    So we do have a major--we did a major inventory of the law 
and order facilities here in the last 3 years.

                             safety of dams

    Senator Gorton. Let me go on. I guess I am with you for the 
next several sets of questions. Dam safety. Let us move the 
microphone down there and talk to me about dam safety.
    My notes tell me here that your classification of dams with 
respect to safety has less to do with the risk that one of them 
is going to fail as it does with the consequences of a failure 
if it took place. How do you determine and how do you set 
priorities for the repair of dams in looking at the actual risk 
of a failure?
    Mr. Virden. We participate with the Department of the 
Interior in a technical rating of all dams. The Bureau of 
Indian Affairs has approximately 100 dams out of the 400 the 
Department of the Interior has. And you are correct, the 
technical priority rating is based on consequences of failure.
    Senator Gorton. Is there a separate determination of the 
actual risk of a failure? You know, the consequences can be 
overwhelming and the chances of failure 1 in 10,000, and 
consequences in another case, I suppose, considerably smaller, 
but the dam may be in imminent danger of collapse. Is there a 
separate rating system for the chances of a failure as against 
what the potential consequences might be?
    Mr. Virden. I have a staff person here I can check with, 
but I believe that the technical rating priority system does 
include that, the structural soundness.
    Senator Gorton. How do you set your priorities for this? 
You have got 104 dams. How many of them are actually at serious 
risk of failure right now?
    Mr. Virden. Ross Mooney is our dam safety person.
    Senator Gorton. OK.
    Mr. Mooney. Good afternoon. My name is Ross Mooney.
    Senator Gorton. It is still morning. It just seems long.
    Mr. Mooney. It seems like we have been here for a while. 
[Laughter.]
    I am the dam safety officer for the Bureau of Indian 
Affairs. As Terry said, we have about 100 dams in the Bureau of 
Indian Affairs that are rated as a high or significant hazard. 
The criteria by which we evaluate dams is set up by the Federal 
guideline, which all Federal agencies must use throughout the 
country.
    There are two different things you look at. First is, as 
you said, the impact of the dam regardless of what its 
condition is. If it did fail, what is its impact on life and 
property? There are three classifications--high, significant, 
and low. Low hazard means nobody will get killed and minimal or 
no property damage will occur.
    To be on the departmental technical priority ranking list, 
a dam must be a high or a significant hazard. These two ratings 
mean that life is in danger and significant property damage 
could occur. You can have a perfectly safe dam, but it will be 
a high or significant hazard dam because if it failed, what we 
call a sunny day failure, it could take life or damage 
property.
    Over on the other side, you have technical factors, about 
eight of them, that you go in and look at various criteria of 
the dam--the seepage, the structural integrity--various factors 
that are then evaluated, assigned a point value. The Department 
under Secretarial Order 3078 has assigned the Bureau of 
Reclamation with departmental oversight. As part of their 
oversight responsibilities they are the keepers of the TPR, the 
technical priority ranking list.
    This list is comprised, I think, of about 420 dams now. As 
Terry said, we have 100. Actually we are up to about 110. Since 
the Indian Dam Safety Act was passed in 1994, it refers to I 
believe 54 dams. We have doubled that since then. It is not 
that we have built any dams. it is just that we have gone out 
and reevaluated the dams that we do know about. And some of 
them, because we found people living downstream, we have had to 
reclassify to high or significant hazard.
    We do have an agreement with the Bureau of Reclamation, by 
the way, to have them go out and do some of the technical work 
for us, the evaluations, since they are the experts in this 
area for the Department of Interior, and that is why they have 
departmental oversight.
    Is that the information you needed?
    Senator Gorton. Well, what are you going to get done if you 
get your $22 million this year? What dams are you going to work 
on and how have you determined which ones are going to get that 
relatively modest amount of money?
    Mr. Mooney. Well, the Bureau of Indian Affairs uses the 
TPR's for setting its priorities, the list. I neglected to say, 
when you assign all these points to each of the dams and add 
them up and you rank them, the dam with the highest number of 
points is at the top and it goes down. The Bureau of Indian 
Affairs uses this list for funding purposes, and we fund the 
dam with the highest likelihood of failure.
    Senator Gorton. If we get the $22 million, will we get 1 
dam completely repaired or 10?
    Mr. Mooney. Historically, we got $18 million in the past. 
You want to know what we would do for the $4 million?
    Senator Gorton. Whether it is $18 or $22 million. You have 
got all of these dams on the list. How many dams will that 
actually repair?
    Mr. Mooney. We will be working on 12 dams. There will be 
three dams for which the final construction will be funded.
    In the safety of dams program it is a six-step process from 
the evaluation of the dam as a high or significant hazard dam, 
then you go in and look at the physical site of the dam, and 
then you do the conceptual designs, final designs, and then 
finally construction. So it is a six-step process which takes a 
couple years to get through.
    Senator Gorton. So when you say--I am sorry; was it 12?
    Mr. Mooney. Yes; 12 dams we will be working on.
    Senator Gorton. Yes; but that includes the very first of 
those six elements?
    Mr. Mooney. Right.
    Senator Gorton. You will actually finish three?
    Mr. Mooney. We will actually fund the final construction 
for three. The rest will be funding the other portions of steps 
in other dams.
    Senator Gorton. All right. Thank you. You have certainly 
answered my questions.
    Good morning. One more set of questions.
    Senator Domenici. I am just here to listen.
    Senator Gorton. OK. Ms. Deer, as you of course well 
remember, last month the Indian Affairs Committee and the 
Banking Committee had a fairly well publicized hearing on 
Indian housing programs. We both learned, without regard to any 
misuse, that Indian housing costs are higher on average than 
other low income housing projects, partly, I suppose, because 
they are often in isolated areas, partly because of Native 
hiring preferences, and partly because of the Davis-Bacon Act.
    The misuses of the money in the Indian housing programs 
were nationwide and were significant. Fortunately, you did not 
have any responsibility for that. But I would like to ask the 
general question connected with all of these construction 
projects we are talking about, whether it is work on dams or on 
schools or on justice facilities: Are all of the same factors 
of additional costs applicable to other Indian construction 
projects as they are to schools?
    Second, do you run the risk of the same kind of misuse of 
money for which HUD was at least partly responsible?
    Ms. Deer. Well, let me say that nobody is perfect and that, 
yes, there have been problems. But we are consistently working 
to prevent problems, and in my earlier statement I talked about 
the resolution of these audits and better management. So 
everyone knows that we have to adhere to the highest standards 
and that when there are problems there is a lot of publicity on 
them.
    I would have to refer to our construction person in terms 
of your question about the general problems.

                  construction on indian reservations

    Senator Gorton. Well, I would like an answer to that 
question. Does construction of all these other facilities cost 
considerably more on Indian reservations than it does for local 
governments or in the private sector?
    Mr. Schweigert. In facilities, which I can speak for, 
Senator, our costs are relatively the same. Because of the fact 
that in most cases our facilities are in rural or out of the 
way places, they do cost more money generally, because you have 
to haul material and people in as opposed to cities and so 
forth, metropolitan areas.
    But we feel that our projects are well designed. We have 
architects and engineers that are registered normally in the 
States in which we design and build those facilities, and our 
cost estimates are based on national costs. So we feel that our 
costs are----
    Senator Gorton. Does either Indian preference or the Davis-
Bacon Act add significantly to the cost of these projects?
    Mr. Schweigert. It would depend on whether the tribes 
handled the project through a 638 contract. If they handle it 
through a 638 contract or a 297 grant, it could be higher 
because of their associated costs of managing the project.
    Senator Gorton. Thank you.
    Mr. Schweigert. But that would vary from tribe to tribe. 
There is quite a variance between tribes.
    Senator Gorton. Thank you.

                     education program performance

    I would now like to ask a few more questions on education, 
but in this case not education construction but education 
performance. Since we have a significant number of Indian 
students in Indian schools, but a far greater number in public 
schools, how do you evaluate the quality of education that is 
being provided by the Indian schools? Is there a significant 
difference in student performance in the Indian schools and 
among Indians in the regular public schools?
    Do we know that we are getting a decent quality of 
education for the money that we are investing?
    Ms. Morris. The difficulty surfaces because you do not have 
identical assessment measurements in public schools as in our 
school system or to compare also with, say, the church schools 
on the reservations. In the past there have been reports, none 
very recently, that gave indications that Indian students 
attending public schools fared much better than they did in 
Bureau schools. We have not seen a report in recent years that 
is documenting that.
    Within our schools, since about 1987-88 we have been 
working very strongly with the schools on improving. The focus 
has been on improving them academically. And there is an 
effective schools movement that began in about 1988, and that 
has continued now that there is legislation for Goals 2000 and 
the Improving America's Schools Act.
    All of our schools are in the school reform movement. They 
are looking at how they test the children, how they assess them 
with multiple measures, rather than simply standardized tests. 
There is one school that is in the process of getting 
reaccredited. Otherwise, 99 percent of the schools are all 
accredited now, whether regionally, and/or by the State.
    Senator Gorton. Are Indian schools required to meet the 
State education requirements of the State educational 
authorities in the States in which they are located?
    Ms. Morris. They are not required to. Many of them choose 
to. If they choose to be accredited by the State, then they 
follow those mandates.
    Senator Gorton. Did you say 99 percent were accredited?
    Ms. Morris. Either by a regional accreditation agency and/
or by the States. Some are dual accredited by a State and 
regional.
    Senator Gorton. How many of the Indian schools are actually 
accredited by the States in which they are located?
    Ms. Morris. Is it about 67? Yes.
    Senator Gorton. Can you make comparisons on ultimate 
performance by SAT scores? Are SAT scores in Indian schools 
comparable to those in public schools or comparable to the 
Indians in public schools who take SAT's?
    Ms. Morris. Again, we are not talking about standardized 
achievement tests, but SAT's, those that are preparing people 
for college----
    Senator Gorton. Right.
    Ms. Morris [continuing]. That is very much a voluntary test 
that young people can take, like the ACT's. And the States 
maintain that data, we do not, because the States administer 
the tests, those tests. So we could gather that data for you if 
you wanted it for the 23 States where we are, where we have 
schools. But we do not maintain that.
    Senator Gorton. Do you not think that that would be of 
considerable value to you?
    Ms. Morris. It would give us additional indicators. But 
again, it does not impact all of the young people.
    Senator Gorton. No; of course not.
    Ms. Morris. Because it is a voluntary test.
    Senator Gorton. It would seem to me that a comparison of 
how your young people who voluntarily take that test in Indian 
schools do as against the general population or against the 
Indian population in public schools would be of great value to 
you in determining and setting priorities.
    Almost 10 years ago, Congress requested that the Office of 
Indian Education Programs complete a comprehensive education 
plan on the requirements of Bureau schools and how best to 
address them. We, at least, have never received such a plan. At 
last year's hearings you told us that a single comprehensive 
plan was found to be inappropriate for all of the various 
schools, and I am told that your office has been developing a 
strategic plan to comply with the requirements of the 
Government Performance and Results Act of 1993.
    When are we going to see that, and how does it differ from 
what was requested in 1988?
    Ms. Morris. I was not here 10 years ago and I understand 
that there was quite a bit of turmoil that was generated as a 
result of that request. I do not know the facts behind that.
    Our intention in this last year since I have come in as the 
Director has been to set a plan for the next 5 years that any 
organization, any entity, has to have. You have to have a plan 
to know where you are going and to measure yourself to see what 
progress you are making. So we have been meeting with staff in 
the field, with tribal reps as well, to develop a strategic 
plan.
    A draft was prepared last December. We started consultation 
with tribes in February on that. We are in our official 
consultation mode right now. The first regional hearing, 
regional consultation in fact, started today for the east 
coast. The draft plan has been distributed across the country. 
The strategic plan is a part of our consultation package. There 
are eight major items that we are consulting on, and it is 
included in the yellow consultation booklet that has been 
distributed for review prior to the consultations.
    If we did not get a copy to you and your staff, we can do 
that so you would have a copy of that. But it has been 
available since December.
    Senator Gorton. OK. We would like that.
    [Clerk's note.--Due to its volume, the above mentioned 
document has been retained in subcommittee files.]

                       remarks of senator bennett

    Senator Gorton. Senator Bennett, at this point I am at the 
end of one set of questions and ready to move to another. We 
are delighted to have you here, and if you have any comments or 
any questions I will defer to you at this point.
    Senator Bennett. Thank you, Mr. Chairman. I am going to 
have to leave very shortly because, in the genius of the 
Senate, we have two subcommittees of the Appropriations 
Committee meeting simultaneously and I am a member of both of 
them. So I am going to have to run off.
    Senator Gorton. You are going to have to ask my 
transportation questions for me.
    Senator Bennett. Yes; I will do my best to do that.
    I have a personal observation. We had an Indian foster 
daughter who lived with us for 4 years coming off the 
reservation. We put her in the schools where we lived then in 
the Los Angeles area and found a very significant difference 
between her Indian experience and the experience she had in 
public schools in the Las Virgines School District in the Los 
Angeles basin.
    When she returned to the reservation, which was an 
appropriate thing for her to do given her past experiences and 
her long-term life goals, her educational opportunities dropped 
off very dramatically from those that she had had in our 
neighborhood, and we were sorry to see that happen.
    We stayed in touch with her, consider her still a foster 
daughter, and her child our foster grandchild. We are 
personally very distressed at what we see as a rather bleak 
future for this grandchild compared to what would be available 
if she could somehow get into a school that we would consider 
more traditional in the American educational system.

              long-term goal for bureau of indian affairs

    It is a universe of one and it is never fair to make 
generalizations from it, but I could not resist, given the line 
of questioning you are having. And that brings me to the 
general question that I guess, Ms. Deer, is your 
responsibility, of what is the long-term goal of the Bureau of 
Indian Affairs?
    We are giving you roughly $2 billion every year to spend 
on, if I understand your testimony correctly, about 1.2 million 
Indians. Where do we want this segment of our population to be 
10 years, 20 years from now? What are we hoping to build with 
this $2 billion that can say to my foster granddaughter, things 
are going to be better for you and your children as a result of 
the money the Federal Government is spending than they were for 
your mother? We are building a ramp toward what? Fill in the 
blank for me.
    Ms. Deer. The Bureau of Indian Affairs is the main 
mechanism by which the U.S. Government carries out its 
responsibilities to the tribes as outlined in the treaties and 
court decisions and attorney general's opinions and other types 
of acts. I would envision the Indian tribes having the basic 
standard of living comparable to the rest of the U.S. 
population.
    At this point, by every single census American Indians and 
Alaska Natives are at the bottom of the socioeconomic ladder. I 
feel that there is the power here, especially in the 
Appropriations Committee, to meet many of these needs. It is 
not rocket science. We need to invest more in education, more 
in health services, so that the tribes will be able to march 
into the 21st century with hope.
    So I would emphasize that you have the power in your 
capacity as U.S. Senators, as members of this Appropriations 
Committee, to allocate sufficient resources so that we can 
repair the dams, so we can build the schools, so we can make it 
possible for the tribes to have a very realistic standard of 
living.
    Senator Bennett. So the long-term goal is to raise the 
standard of living, without making any attempt to bring the 
Indian population into any kind of integration with the rest of 
the population of the country?
    Ms. Deer. Many thousands of Indian people live in urban 
areas, and it is an individual's choice whether they want to 
live on the reservation or whether they want to live off the 
reservation. You ask a very interesting question which has been 
the subject of many articles and many discussions, integration 
versus assimilation. I would point out in the fifties 
relocation was one of the policies, where they attempted to 
have many Indian people leave the reservations and move into 
the cities. It was also the termination era, et cetera.
    I would like to point out that it would be important for 
individuals to have the choice and for the tribes to exercise 
their choices in all these matters. And at this point, again, 
if there could be a long-term commitment on a bipartisan basis 
to fund these programs, we could resolve many of these 
problems.
    We, the United States, rebuilt Europe after World War II, 
and this is a much smaller population. It is within our 
interior boundaries. So I would ask you to consider this as you 
make your deliberations.
    Senator Bennett. Well, this is an appropriations hearing, 
so probably not the proper venue for this, but, yes, we put 
money into the Marshall plan and rebuilt Europe, and then we 
disappeared economically. We stayed there militarily for a 
variety of reasons, but at the invitation of the Europeans. We 
put them on their feet and then they took over.
    Is there an anticipation that at any point this will cease, 
in the European pattern?
    Ms. Deer. That is Europe and this is this country, and we 
are talking about the native peoples here. Efforts such as the 
self-governance, self-determination, have been aimed at helping 
tribes assume more responsibility and to make a change from the 
previous policies of paternalism that the Bureau and the 
Government followed to one of self-governance and self-
determination.
    So I think it is too far in the future to anticipate that, 
but I always anticipate that there will be American Indians and 
Alaska Natives living in this country, that we will have a 
government-to-government relationship with. This is a large 
country. We have millions of people here, and I think that the 
fact that we have approximately 2 million Indians now is a 
great tribute to the courage and the leadership of the 
individual Indian people as well as the tribes, in view of the 
harsh policies and many of the problems that the tribes have 
encountered over the years.
    Senator Bennett. Well, as I said, this is probably not the 
appropriate venue to have this discussion, but we appropriate 
money year after year--and if I am not mistaken, Mr. Chairman, 
is this not the largest single portion of this subcommittee's 
budget?

                programs subcommittee is responsible for

    Senator Gorton. Well, Senator Bennett, you bring up 
something that I want all the audience to be able to come up 
and see when they wish. This chart shows the relative amounts 
of money spent for the various purposes within this 
subcommittee's jurisdiction. The blue are Indian programs. That 
is not as tall as all of the land management programs together, 
but it is taller than any one of them.
    Senator Bennett. Yes.
    Senator Gorton. Land management agency budgets are large. 
Energy and research and cultural activities are all much 
smaller. So yes, funding in our bill for native programs is a 
considerable amount of money. It is larger than any single 
other purpose, but it is not as large as all of our land 
management combined.
    Senator Bennett. Yes; I see. Well, coming from where I come 
from, in the business world, I always like to think in terms of 
a strategic plan and a goal, and where this is going to take us 
5 years, 10 years from now. Or are we in a circumstance where 5 
years, 10 years, 20 years from now, we are going to be 
appropriating money on a maintenance basis and nothing is going 
to change, other than we want to raise the standard of living 
within the present context?
    If that is the policy decision made someplace else, I 
should understand that that is what our appropriations' 
function is. But I would like at some venue to open that 
question, and this is clearly not the venue, and I have 
exhausted my time.
    Senator Gorton. No; it is appropriate--no, on the contrary, 
Senator Bennett, it is an appropriate venue for that. I asked 
that question of Ms. Deer last year and got the answer that you 
fear, that it is essentially a maintenance program.
    I guess my followup question to yours to Ms. Deer would 
relate to the fact that, while the goal is that the standard of 
living of Indians in Indian country be roughly the equivalent 
of that of all Americans, in fact, it is the lowest 
socioeconomic identifiable ethnic group in America, which would 
seem to me at least to indicate that 150 years of this kind of 
policy have been an overwhelming failure.
    I guess my philosophical question to Ms. Deer would be, is 
that simply because we have not appropriated enough money and 
that it should be double or more of this, more or less in 
perpetuity? Is it because of the total ineffectiveness of the 
Department of the Interior and the Bureau of Indian Affairs for 
100 years or more? Or is it because there is a conceptual flaw 
in attempting to keep people separate and say that there are 
obligations toward them other than their own obligations to 
work for themselves?
    Ms. Deer. You have asked a mouthful of questions.
    Senator Gorton. I sure have. I think that is what Senator 
Bennett was looking at, too.
    Ms. Deer. Indian people want to be Indians. They want to 
live in the reservation areas. They would like to maintain the 
culture, the kinships. Not everyone wants to melt into the 
mainstream. When the relocation came, some Indians did stay in 
the cities, but there was a lot of travel back and forth.
    One of my own tribal people camped out in Chicago--this is 
my term--camped out in Chicago for 30 years. When retirement 
came, she now lives 10 miles from the reservation. So Indians 
moved into the cities, but established Indian centers and 
maintained their cultural and ethnic identity.
    Again, these are questions that I think would be very 
appropriate for the tribal people to answer. But I want to say 
that Indian people want to be Indians, wherever it is, and each 
person can decide for themselves what this means. But we do 
envision the Federal Government carrying out its 
responsibilities as specified in the treaties and the court 
decisions and the Attorney General's opinions and some of the 
other actions.
    I think that, to answer your question about the cost, the 
wealth of this country is built from the wealth of the tribes. 
This all at one time was Indian country and, as you know, over 
a long period of time the reservations were established, and 
the tribes have been deprived of meaningful economic 
opportunity for many years. In my opinion, if there could be 
this long-term commitment to resolve some of these very serious 
problems that we talked about here with the schools, with the 
dams and roads and so on, and help the tribes with their 
economic development projects, the tribes could in all 
probability really function well.
    There are tribes that are doing this now, and I would point 
out that the Mississippi Band of Choctaw Indians has done a 
remarkable job in a 30-year period, going from the bottom of 
the socioeconomic ladder in Mississippi to now being the major 
force in that area. This has occurred through the hard work and 
determination and leadership of the chief and the tribal 
leaders there, taking advantage of the opportunities that were 
made available by this Government. They are doing well and I do 
not envision that they would want to make backward changes.
    So some of the problems of the tribes are very hard to 
solve. For example, out in the plains we have significant 
numbers of people and there are not enough resources at this 
point to adequately meet the health and education and economic 
development needs of the tribes out there.
    So again, it is hard to answer in a global way speaking for 
all the tribes, because there are small tribes, there are 
medium tribes, there are large tribes. I really do appreciate 
the many-faceted questions that are being asked here and I 
would encourage all of us to carry on some additional discourse 
when it is appropriate.
    Senator Bennett. I suppose we have probably exhausted that 
subject, but I am sure we are going to come back to it again 
and again, because you have given me an example of a tribe that 
demonstrated--I know nothing about it. I am just taking what 
you told me at face value. I would guess, from what you have 
said, this is a tribe which members have shown some fairly 
significant entrepreneurial spirit, created their own economic 
activity, and, therefore, got themselves into a circumstance 
where the long-term vision can be that they would ultimately be 
off any Federal kind of subsidy, just the way, back to your 
earlier analogy, the Europeans have gotten off the American 
subsidy at the end of the Second World War.
    If indeed that is a correct analysis of what you said, it 
would seem to me the clear message on the part of all of 
society, as manifested through its elected representatives 
here, would be to try to engender that entrepreneurial spirit 
on the part of every tribe, because the Mississippi Choctaw 
Indians apparently solved their problems. Their standard of 
living is not at the bottom. They have, in your phrase, become 
one of the leaders in that area.
    That is what I would like to see eventually happen, so that 
we could look at this money and say ultimately this was seed 
money put up by the Federal Government, on the basis of which 
the Indian tribes in America, wisely using this seed money, 
became economically self-sufficient and weaned themselves to 
the point where they would not require it any more.
    But if that is a philosophical no-no and you are saying, 
no, under the treaties these people must never be weaned from 
some kind of a Federal subsidy, then I want to know if that is 
the basic policy.
    Ms. Deer. The tribes wish to have economic self-sufficiency 
and, as I mentioned earlier, good education, good health. We 
have tribes that have achieved some of these and I mentioned 
one, the Mississippi Choctaws. Others are striving toward this.
    But again, the reason I mentioned the Marshall plan was to 
remind all of us how we helped rebuild the European countries, 
and we have not been able yet to do that, to help the tribes 
rebuild so that they can be economically self-sufficient.
    Senator Bennett. I think we have exhausted this.

                         political contribution

    Senator Gorton. I would like to go on to another question. 
Recently the Washington Post reported that the Cheyenne Arapaho 
Indians had given $107,000 to the Democratic National Committee 
during the course of last fall out of a welfare fund for tribal 
members who need help with hospital bills, heating bills, and 
the like, from a tribe with what the newspaper described as 80 
percent unemployment.
    Was that an appropriate use of tribal money?
    Ms. Deer. Well, let me say that tribes, like all other 
groups of citizens, do have the right to make political 
contributions. I am not sure that that is where the money came 
from, but it is their basic right. And I think that your 
question is appropriate.
    Senator Gorton. Well, do you know the source of that 
$107,000 contribution?
    Ms. Deer. No.
    Senator Gorton. You say you do not know whether it was from 
the tribal welfare fund?
    Ms. Deer. No; I do not have that information.
    Senator Gorton. Do you know whether Federal appropriated 
funds were involved, went into that fund out of which the 
contribution was made?
    Ms. Deer. No; I am sorry, I do not know that.
    Senator Gorton. Does BIA have the right to ask?
    Ms. Manuel. We are fairly certain that the funds did not 
come from Federal sources. However, you may be aware that the 
inspector general has sent a letter to Mr. Regula and Mr. 
Livingston dated April 8 that indicates that there will be an 
audit by the inspector general on the Federal funds, as 
requested.
    Senator Gorton. I am sorry. The inspector generalof the 
Department of the Interior?
    Ms. Manuel. Yes; of the Department of the Interior.
    We have been working with the Bureau of Indian Affairs and 
the Cheyenne Arapaho Tribe over the last couple of years over 
some audit issues, so that we are fairly certain that these 
funds did not come from Federal dollars. Upon the conclusion of 
the inspector general's review and our own conclusion of the 
outstanding audit issues that we are working with the tribe on, 
I think we can give you a more definite answer.
    Senator Gorton. But the Cheyenne Arapaho Tribe does get a 
distribution for tribal government and for other purposes from 
the BIA?
    Ms. Manuel. Yes.
    Senator Gorton. And some of that money certainly does go 
into the tribe's welfare fund, does it not?
    Ms. Manuel. They operate a social services program, yes.
    Senator Gorton. With money appropriated to the BIA and 
distributed by the BIA?
    Ms. Manuel. The social services program is actually run out 
of the area, so the tribe does not run--my understanding is 
that the tribal welfare fund that was referred to in the press 
releases was actually a tribal fund that was established by the 
tribe, and we had no control over it and none of the Federal 
dollars go into that fund.
    Senator Gorton. Federal dollars do go into it?
    Ms. Manuel. Do not, do not.
    Senator Gorton. Do not go into it? Well then, what funds do 
go into it?
    Ms. Manuel. Apparently funds that the tribe generates from 
sale of cigarettes, bingo revenues, funds that they generate 
from tribal enterprises.
    Senator Gorton. All right. So this fund to the best of your 
knowledge did not have any Federal money in it?
    Ms. Manuel. That is right, that is right.
    Senator Gorton. And that is what the inspector general is 
attempting to determine?
    Ms. Manuel. Yes.
    Senator Gorton. And I assume that you would take the 
position that it would be inappropriate for a tribe to make a 
political contribution out of Federal money?
    Ms. Manuel. Yes.

                        indian country in alaska

    Senator Gorton. I had hoped that Senator Stevens would be 
here. I know he has a large number of questions about the 
recent decision with respect to Indian country in Alaska. I 
guess I would just like to ask you, Ms. Deer, perhaps one 
general question on that subject.
    I understand that the BIA has said that that decision, 
assuming that it is finally upheld, will not have any 
significant impact on BIA funding. Am I correct in that 
assumption?
    Ms. Deer. That is correct.
    Senator Gorton. And why would it not?
    Ms. Deer. At this point, according to the Information I 
have, it will not have any significant impact. The tribes do 
have self-governance compacts and they make decisions under the 
self-governance compacts as to how the moneys are spent.
    Senator Gorton. So in your view, while the tribes might 
have more authority or more responsibility, the relationship 
between the tribes and the distributions to the tribes from the 
BIA would not be affected?
    Ms. Deer. Basically, yes.
    Senator Gorton. Well, as I say, Senators--there are a 
number of very detailed questions on that subject from Senator 
Stevens, and we will submit those to you in writing and hope 
that you can answer them.
    Ms. Deer. We will be very happy to provide the information.

                     Additional committee questions

    Senator Gorton. I also have some questions from Senator 
Cochran, and there could be those from others, and there will 
be some followup questions under my name on the subjects that 
we have already discussed. As Senator Domenici is, I am 
particularly interested in education programs and you will get 
some more questions on those.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing.]

                     Additional Committee Questions

                            wa he lut school

    Question. Last year Congress appropriated $2.5 million to 
begin rebuilding of the Wa He Lut Indian School in Washington 
State. $2 million was sent to the school as a construction 
grant last November. Based on the Bureau's own program of 
requirements calling for a 17,500 square foot facility, the 
total project cost will be $4 million. Is the Bureau supportive 
of an additional $2 million for this project?
    Answer. The Bureau provided a $2 million construction grant 
to the school board from the fiscal year 1996 emergency 
supplemental appropriations. The other $500,000 was provided 
for emergency evacuation of the school children during the 
flood. Based on an estimate prepared by the school board's 
architect dated April 11, 1997 for a 18,151 square foot 
replacement school, the estimated total construction cost is 
$4,182,000, or an additional $2,182,000 above the appropriated 
amount.
    Question. The Wa He Lut School rebuilding was chosen as one 
of five pilot projects to make BIA school construction ``more 
entrepreneurial and customer-focused,'' in Vice President 
Gore's words. Given the fact that the Office of Indian 
Education Programs originally requested $5 million for this 
effort, can you advise this Committee of any compelling reason 
why we should not provide the additional funding to complete 
this task?
    Answer. The request from the BIA, the Department and the 
Administration for the Wa He Lut School emergency response and 
repair needs from the 1996 floods was $2.5 million. The request 
was based on the report on the school's needs at the time as 
well as the comparative need of the other reservation emergency 
project needs. This amount was funded in the fiscal year 1996 
emergency supplemental appropriations.
    The Wa He Lut School Board was working with the Federal 
Emergency Management Administration (FEMA) to try to secure 
additional funds for the school replacement since the old 
school was destroyed by the 1996 floods. The Bureau understands 
that there is potentially up to $402,000 which will be made 
available to FEMA and eventually to the School Board. If this 
occurs, the balance needed for reconstruction is $1,780,000, 
based on the school board's estimate for replacement.
    The Bureau recognizes that Wah He Lut School cannot be 
completely replaced by the $2 million grant to the school board 
from the emergency supplemental appropriations. However, the 
Bureau's existing schools have an immense backlog of over $680 
million in code and standard deficiencies, many of which 
related to health and safety. In order to fairly distribute the 
limited funds available under constrained budgets, it has been 
necessary to establish a national prioritization process. 
Through this competitive process, a national list of annual 
repair projects are determined based on need. For School 
replacement projects must be funded in the order of the 
Congressionally approved priority process projects in order of 
need, Unfortunately, Wa He Lut School replacement is not 
currently high enough on the repair priority projects list; is 
not on the replacement school priority list frozen by Congress, 
and of which only seven of the 16 schools on the list have been 
completed. The school will need to compete in the future for 
any additional funds necessary for replacement if funds are not 
forthcoming from other sources.

                     tribal base fund distribution

    Question. Will you please provide this Committee with 
information on how Tribal base is determined? When was this 
formula last revised? Does the BIA take into consideration 
Tribes' current and changing population, their socioeconomic 
status--their need? Why isn't the base reevaluated periodically 
to reflect changes? Shouldn't it be, given that federal funding 
is declining? Would legislation be necessary to effect this?
    Answer. Historically, the funding allocated to Tribes has 
been based on the Indian Priority System, an old system that 
the Department and Bureau had in place for several years. In 
that distribution system the Tribes in each location and each 
area established what they felt was their need for funding on 
the basis of population, land base, forestry dollars, number of 
forestry acres. While a new system, the Tribal Priority 
Allocations System (TPAS) is now in place, the historic method 
of distribution is still in place.
    Tribal base fund distribution has not, to date, taken into 
consideration changing population or socioeconomic status, but 
included, historically, Tribes' determination of their need as 
described above. As programs such as Indian Child Welfare 
Assistance have been transferred to TPA, the distribution has 
been based on population, number of children at risk, etc. In 
the fiscal year 1998 budget, however, an increase of $7.3 
million is requested largely due to the increase in reservation 
population. Similarly, an increase of $10 million is requested 
for contract support based on the proposed TPA general increase 
and the fact that about 65 percent of the TPA funding is 
contracted by Tribes.
    Several programs recently transferred to TPA are not 
included in the Tribal base: contract support, welfare 
assistance, road maintenance and the housing improvement 
program. Funds appropriated for these programs are distributed 
by a variety of formulas. Need is still a key factor for 
welfare assistance and housing improvement. Need is based on an 
individual eligibility basis. Contract support is distributed, 
for the most part, based on rates negotiated with the Inspector 
General. Road maintenance is distributed on the following 
factors: the actual need requests for emergency, 
administration, bridges, airstrips and snow/ice removal; and 
the miles in the BIA Roads system. The BIA Roads system miles 
are weighted to reflect the road surface-type priorities.
    An additional factor that has come into play in Tribal base 
fund distribution is the focus and needs of Small and Needy 
Tribes and the need to provide funding to Tribes that are newly 
recognized. The method of distribution is currently the same 
for both programs: provide a minimum of $160,000 for Tribes in 
the continental United States and $200,000 for Tribes/Native 
entities in Alaska. The Joint Tribal/DOI/BIA Reorganization 
Task Force (Task Force) prepared a report on the Small and 
Needy Tribes and the fact that base funding for many Tribes, 
particularly in Alaska and California, are far less than the 
defined minimum levels above, and not enough to even begin to 
provide a viable Tribal government operation. The Task Force 
preliminary assessment of the total needed to bring small and 
needy Tribes to the minimum level was $23 million. To date, $6 
million has been appropriated and $8 million is requested for 
fiscal year 1998.
    Over many years, several studies have been undertaken to 
explore and define an ``equitable fund distribution 
methodology''. The most recent, done in 1989, used population, 
Tribally owned acres of land, individually owned acres of land 
as criteria and created agency management pools. Using the 
formula created in the study and comparing to current funding 
levels at the time, Tribes in five areas would have received 
increased funding, the Navajo Nation funding would have 
remained basically level, and the Tribes in seven areas would 
have received less funding. The report found that the data 
available was lacking and not always comparable from area to 
area. The report recommended that if a formula is instituted at 
all, that it be instituted over a number of years (five to ten) 
to minimize short term large dislocations.
    This study, similar to those undertaken earlier, basically 
resulted in the same results. There is not a formula for 
``equitable funding'' that would produce a consensus from 
Tribes, much less a majority.
    The Task Force recommendations also included creating a 
``standard assessment methodology'' tool for each individual 
program in the Bureau's annual appropriations. Considerable 
time over a two year period was spent in developing a model for 
one program, to be followed and used for the rest of the 
programs. A Work Group to develop this model was comprised of 
both Tribal and Bureau staff. There were exhaustive hours of 
discussion on the subject and again, it was discovered that it 
is virtually impossible to achieve ``equitable fund 
distribution'' that will achieve a consensus among Tribes and 
if that were possible, it would only be so with significantly 
increased appropriations in TPA. Finally, the Bureau does not 
believe legislation would be required to change the fund 
distribution methodology.

                          education facilities

    Question. The Bureau has raised the fact that many of its 
education facilities are very old. Will the Bureau provide this 
Committee with specific information as well as comparative 
information on the average age of public schools in the United 
States?
    Answer. The table below shows the number of school 
facilities in age increments of nine years.

                                                             SCHOOL FACILITIES BUILDING AGE                                                             
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    School facilities building age in years                             
                                                      --------------------------------------------------------------------------------------------------
                                                         0-9     10-19    20-29    30-39    40-49    50-59    60-69    70-79    80-89    90-99    Total 
--------------------------------------------------------------------------------------------------------------------------------------------------------
School facilities....................................       21       26       23       49       20        9       26        7        2        2      185
Percentage of total..................................       11       14       12       26       11        5       14        4        1        1      100
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Bureau staff have attempted to obtain a report providing 
the national average age of public schools but have found no 
information from either GAO or the Department of Education. It 
is important to point out, however, that public schools have a 
tax base and other resources upon which to draw. The Bureau 
does not.
    The Administration has requested $5 billion to address 
facility repair needs for public schools across America with a 
two percent set-aside for the Department of Interior. This 
resource combined with the Bureau's education construction 
budget request will help eliminate the ever-growing backlog of 
repairs in these schools.

                         education performance

    Question. Does the Bureau review the relative performance 
of Indian students in public schools versus BIA schools? 
Shouldn't it, if it does not already? How does the Bureau 
determine whether BIA schools are doing a good job of teaching? 
What is the average SAT or ACT score (or other standardized 
test of aptitude and achievement) in public schools? What is 
the average for students taught in BIA schools?
    Answer. No, the Bureau does not compare the performance of 
Indian students in BIA funded schools with Indian students in 
public schools. It is difficult to make comparisons between BIA 
schools and public schools. The Bureau does not collect SAT or 
ACT scores on its Indian students. Any testing for career 
planning or academic student assessment for BIA schools is 
designed at the local level with school board and parental 
input. BIA schools offer programs which are accredited by 
states or regional associations and require all teachers to 
meet state certification requirements. Almost all schools are 
participating in the school reform movement as defined in Goals 
2000: Educate America Act and Improving America's Schools Act 
of 1994.
    Within the Bureau's overall strategic plan to be submitted 
to the Congress in September 1997, the Office of Indian 
Education Programs' (OIEP) performance goals for fiscal year 
1999 will address student dropout rates, student attendance, 
student academic performance, Native languages and school 
accreditation rates. Under the requirements of GPRA, the 
student performance indicators selected for measurement will 
reflect the effectiveness of the Bureau's school system.
                                ------                                


                 Questions Submitted by Senator Stevens

                        indian country in alaska

    In December, the Ninth Circuit Court of Appeals issued its 
opinion in Alaska v. Venetie Tribal Government that the Alaska 
Native Claims Settlement Act did not extinguish Indian Country 
in Alaska and that the land Venetie occupies is Indian Country. 
The State of Alaska opposes this decision and has submitted a 
petition for writ of certioraris to the Supreme Court. The 
Court will decide later this summer whether or not to hear the 
case. It is unclear what the Supreme Court will decide; and 
this decision opens the door for the remaining 225 Native 
villages in Alaska to explore the possibility that they have 
Indian country.
    I would like to know more about BIA funding of Alaska 
Native programs and the potential consequences on the Federal 
programs in the Interior bill if the Ninth Circuit's holding 
stands. Assume for the sake of argument that all 226 tribes in 
Alaska are successful in proving they have some Indian country.
    Question. Solicitor Sansonetti issued an extensive 180-page 
opinion in 1993 that there is no Indian Country in Alaska. Is 
that still the Department of the Interior's position?
    Answer. The Office of the Solicitor's position is that the 
portion of the 133-page Opinion of former Solicitor Sansonetti, 
that ``not withstanding the potential that Indian country still 
exists in Alaska in certain limited cases, Congress has left 
little or no room for Tribes in Alaska to exercise governmental 
authority over land or nonmembers,'' M-36-975, at 108 together 
with the January 19 Supplemental I (58 Federal Register 
54364(1993), is subject to review, but has not been withdrawn 
or modified. However, unless it is overturned, the Ninth 
Circuit's decision in Venetie remains the law in Alaska.
    In his Opinion, Solicitor Sansonetti did not conclude 
unequivocally that there is no Indian country \1\ in Alaska but 
found that Indian country might exist in certain circumstances, 
although he believed that Native villages do not have 
governmental jurisdiction over lands and nonmembers on ANCSA 
Native corporation lands and village owned fee lands.
---------------------------------------------------------------------------
    \1\ In 1948, Congress defined ``Indian country'' as follows:
    Except as otherwise provided in sections 1154 and 1156 of this 
title, the term ``Indian country'', as used in this chapter, means (a) 
all land within the limits of any Indian reservation under the 
jurisdiction of the United States Government, notwithstanding the 
issuance of any patent, and, including rights-of-way running through 
the reservation, (b) all dependent Indian communities within the 
borders of the United States whether within the original or 
subsequently acquired territory thereof, and whether within or without 
the limits of a state, and (c) all Indian allotments, the Indian titles 
to which have not been extinguished, including rights-of-way running 
through the same. 18 U.S.C. Sec.  1151.
---------------------------------------------------------------------------
    Question. My staff tell me that the Solicitor's Office is 
preparing a report on the potential impact of Indian Country in 
Alaska. Is that report completed? When do you expect to 
complete it? Please provide a copy of it to the Appropriations 
Committee before it is publicly released.
    Answer. The Department's Office of the Solicitor and the 
Bureau of Indian Affairs have prepared an analysis of the 
implications of the existence of Indian country in Alaska. The 
paper was sent to the Appropriations Committees on March 11, 
1997. A copy is attached.

           analysis of the impact of indian country in alaska

    The following provides an analysis of the implications of 
the existence of Indian country in Alaska, prepared in response 
to a request from the Senate Interior Appropriations 
Subcommittee. The paper is written in general terms, as it is 
difficult to say with any degree of certainty exactly what 
these implications are, since as of this date the Venetie 
matter remains in litigation and is on petition for certiorari 
to the Supreme Court. However, this paper explains the Venetie 
decision and discusses whether the decision would have an 
impact on BIA funding. While the scope of the Venetie decision 
currently remains unresolved, for the purposes of the 
discussion below, the paper assumes that the Venetie decision 
would apply to all Alaska tribes.
    Background. The total BIA funding allocated in fiscal year 
1996 for Alaska programs was $80.2 million. The estimated total 
funding level for BIA Alaska programs in fiscal year 1997 is 
$91.7 million and the fiscal year 1998 budget request is $97.4 
million. The greatest share of funding for BIA Alaska Programs 
(over 90 percent) goes to the Tribal Priority Allocations (TPA) 
activity for programs such as tribal government operations; 
social services programs; law enforcement and tribal courts; 
scholarships; and natural resource management. Tribes may 
prioritize and reallocate TPA funds among programs in 
accordance with their unique needs and circumstances. In 
addition, almost 60 percent of the Alaska TPA funds are 
provided to Tribes through Self Governance grants whereby 
Tribes are allowed greater flexibility in program management. 
Additional information on BIA funding to Alaska is provided in 
the Attachment.
    The Department believes there are no immediate budget 
impacts anticipated beyond the current levels of funding even 
if Indian country is assumed to apply to all Alaska Native 
communities.

                             indian country

    By way of background, the phrase ``Indian country'' is a 
term of art in Indian law. Its meaning evolved over time, and 
Congress in 1948 statutorily defined it for application in the 
criminal context. 18 U.S.C. Sec.  1151. This definition is also 
used for civil jurisdiction. DeCoteau v. District County Court, 
420 U.S. 425, 427 n.2 (1975).
    [T]he term ``Indian country'', as used in this chapter, 
means (a) all land within the limits of any Indian reservation 
under the jurisdiction of the United States government, 
notwithstanding the issuance of any patent, and, including 
rights-of-way running through the reservation, (b) all 
dependent Indian communities within the borders of the United 
States whether within the original or subsequently acquired 
territory thereof, and whether within or without the limits of 
a state, and (c) all Indian allotments, the Indian titles to 
which have not been extinguished, including rights-of-way 
running through the same. \2\
---------------------------------------------------------------------------
    \2\ Under  18 U.S.C. Sec.  1151, Native allotments are Indian 
country, and some might be considered to lie within the boundaries of a 
dependent Indian community. However, the extent of tribal governmental 
jurisdiction over them arguably could be analyzed under the terms of 
the allotment statute, regulations, and 18 U.S.C. Sec.  1151 
case law.
---------------------------------------------------------------------------
    Subsequent case law in the contiguous forty-eight states 
has continued to refine this definition in a variety of 
applications, but the general absence of reservations in Alaska 
led many to believe that Indian country in Alaska did not exist 
beyond the Annette Island Reservation. In its decision in 
Alaska v. Native Village of Venetie Tribal Government, 101 F.3d 
1286 (9th Cir. 1996) (Venetie), the Ninth Circuit held that 
this belief was not correct.

                          the venetie decision

    The issue presented to the Ninth Circuit in Venetie was 
whether the Village of Venetie's Tribal Government had the 
authority to collect a Tribal ``business gross receipts'' tax 
from an out-of-town building contractor who came to the village 
to construct a school under a contract paid for by the State of 
Alaska. The resolution of this issue turned on whether the 
village was a ``dependent Indian community'' within the 
definition of Indian country set out in 18 U.S.C. Sec.  1151. 
The district court ruled that the village could not impose the 
tax because it did not satisfy the district court's 
reformulation of the Ninth Circuit's six criteria for finding a 
dependent Indian community.\3\
---------------------------------------------------------------------------
    \3\ The Venetie case had been remanded previously to the district 
court by the Ninth Circuit for consideration in light of Court of 
Appeals' opinion in Alaska v. Native Villace of Venetie, 856 F.2d 1384 
(9th Cir. 1988), which set out the Circuit's six- factor test for 
determining a dependent Indian community. The six factors articulated 
by the Ninth Circuit in its first Venetie decision include:
    (1) the nature of the area;
    (2) the relationship of the area's inhabitants to Indian tribes and 
the federal government;
    (3) the established practice of government agencies toward the 
area;
    (4) the degree of federal ownership of and control over the area;
    (5) the degree of cohesiveness of the area's inhabitants; and
    (6) the extent to which the area was set aside for the use, 
occupancy, and protection of dependent Indian peoples. Venetie, id., 
856 F.2d at 1391.
---------------------------------------------------------------------------
    Although on appeal the Ninth Circuit agreed with the 
district court that federal set aside for Indians and federal 
superintendence were two prerequisites for a finding of Indian 
country, it stated that these requirements should be construed 
broadly as it had previously ordered in its 1988 decision in 
the same case. Alaska v. Native Village of Venetie, 856 F.2d 
1384 (9th Cir. 1988). Reversing the district court, the Ninth 
Circuit ruled that the Alaska Native Claims Settlement Act 
(ANCSA) did not extinguish Indian country in Alaska. ``In sum, 
we hold that ANCSA neither eliminated a federal set aside for 
Alaska Natives, as such, nor terminated federal superintendence 
over Alaska Natives. As a result, Indian country may still 
exist in Alaska.'' Venetie at 1299-1300.
    Applying its six factor test to the specific factual 
situation presented, the Ninth Circuit held that the land in 
question was federally set aside for Indians as such, and that 
the Native Village of Venetie remained under federal 
superintendence even if not under its dominance. Venetie at 
1300-02. Based on these findings, the Ninth Circuit concluded 
that Venetie is a dependent Indian community, that the land in 
question is Indian country, and that the Tribe therefore has 
the power to impose its tax within such territory. The Ninth 
Circuit remanded the case to the district court ``to determine 
whether Venetie has the power to impose a tax upon a private 
party where the State of Alaska will ultimately pay the 
obligation.'' Venetie at 1302-03.
    After the Ninth Circuit's decision was announced, the 
appellee State of Alaska petitioned the Ninth Circuit for 
rehearing, with a suggestion for rehearing en banc. The Ninth 
Circuit rejected that petition on January 6, 1996. The state 
has since announced its intention to submit a petition for writ 
of certiorari to the United States Supreme Court and calculates 
that its petition is due on April 7, 1997, under the Supreme 
Court's rules. Venetie's opposition will be due 30 days later. 
On January 23, 1997, the Ninth Circuit granted the Alaska's 
motion to stay issuance of the mandate in the Venetie case 
pending the Supreme Court's final disposition of the case. The 
United States is not a party to this litigation, and the 
Supreme Court may or may not request our views on it. Thus, the 
scope of the Venetie decision remains unresolved but applies, 
at a minimum, to the circumstances of the Native Villages of 
Venetie and Arctic Village: a Tribal government which has 
obtained title to its former reserve through a voluntary 
transfer of the land from both Native village corporations.

                     impact of the venetie decision

    Although the Venetie decision can be strictly applied only 
to the facts of the case, in accordance with the request of the 
Subcommittee, the following analysis assumes, for purposes of 
discussion, a broad interpretation of Indian country in Alaska, 
i.e., it assumes all 226 Alaska native groups.

                   general indian programs in alaska

    The existence of Indian country in Alaska would not affect 
the provision of social services programs in Alaska.
    Historically, services provided to Alaska Natives have been 
authorized by the Snyder Act of 1921 which has an extremely 
broad authorization of appropriations ``for the benefit, care 
and assistance of Indians throughout the United States.'' 
Although the BIA has attempted to restrict its ``benefits, care 
and assistance'' in the lower 48 only to Indians living on or 
near a reservation, the realities in Alaska have required the 
BIA to extend the scope of its activities to include all of 
Alaska, treating the entire state as a ``reservation'' for 
provision of services. This scope includes the total Native 
population identified within the state which was served by the 
BIA prior to statehood and which continues today.
    The programs having a service area defined as on or near a 
reservation include Grant Assistance, Housing Improvement 
Program, and Indian Child Welfare grants. The BIA currently 
funds these types of Social Services programs in Alaska through 
the TPA activity.

                      education programs in alaska

    The existence of Indian country in Alaska would not affect 
the current prohibition on BIA-funded schools in Alaska.
    The BIA currently provides, either through direct program 
delivery or through contract or grants, the following education 
programs in Alaska: Johnson O'Malley education assistance 
program for eligible Indian students attending public schools; 
Post-secondary Scholarships; Adult Education; Higher Education 
Scholarships.
    While at one time BIA operated an extensive elementary and 
secondary school system in Alaska, responsibility for educating 
Alaska Natives was transferred to the state over the course of 
twenty years (1966-1985) as a result of an agreement reached 
with the state in 1964. In fiscal year 1982 and 1983, the 
Congress appropriated over $40 million to the State of Alaska 
for costs of upgrading facilities to complete the transition 
from Bureau operated to state operated schools. (These funds 
were provided in addition to routine school operations and 
facility repair funds for the remaining BIA operated schools in 
Alaska.) The transfer of BIA-funded schools to the state 
culminated in Public Law 98-63, the 1985 Appropriations Act, 
after extensive consultation among the state, the BIA, and the 
Alaska Native community. Public Law 98-63 included a permanent 
legislative provision that prohibits the BIA from funding BIA 
schools in the State of Alaska.
    After enactment of Public Law 98-63, the Tribally 
Controlled Schools Act of 1988 (Public Law 100-297), authorized 
a new program of Tribal grant schools and included Alaska 
Native villages within the definition of ``Tribe'' for purposes 
of the program. On May 21, 1993, the Department of the Interior 
Solicitors made a determination that Public Law 100-297 
requires funding of grant schools for Alaska Native villages 
meeting the eligibility requirements of the statute. Since 
fiscal year 1994, Congress has enacted annual appropriations 
language prohibiting funding for BIA grant schools in Alaska.

              tribal courts and law enforcement in alaska

    The existence of Indian country in Alaska might motivate 
Tribes to exercise governmental authority, but the Tribes would 
have to reallocate current funds in order to exercise this 
authority.
    Alaska is a Public Law 83-280 state which means that the 
state has general criminal and civil jurisdiction for police 
and courts over Indian country. Tribes retain jurisdiction 
under the 1968 Indian Civil Rights Act over misdemeanors, but 
only those which involve Indians, a limitation imposed by the 
Supreme Court. Under Public Law 83-280, states can retrocede 
their jurisdiction back to Indian Tribes. However, for this to 
happen, the Secretary must consult with the Attorney General 
and agree to accept the retrocession. In recent years, the 
Secretary has declined to accept retrocession due to the lack 
of federal funding.
    As a matter of policy, the Bureau of Indian Affairs (BIA) 
does not provide funding in Public Law 83-280 states 
specifically for Tribal courts or law enforcement. However, 
some Alaska Tribes have prioritized their TPA funds for tribal 
courts and law enforcement programs.
    At the present time, the State of Alaska is responsible for 
providing law enforcement and detention services on Alaska 
Native lands. The Alaska State Police have developed the 
Village Public Safety Officers (VPSO) program in which local 
village members are provided minimal public safety training and 
can act as first responders to calls for service.

                       alaska native trust lands

    The presence of Indian country in Alaska would not affect 
the Secretary's trust responsibility since the land is not 
currently in trust, and current regulations prohibit the 
Secretary from taking land into trust for Alaska tribes or 
individuals.\4\
---------------------------------------------------------------------------
    \4\ Although trust status per se does not require a finding of 
Indian country, courts may find it easier to determine that trust land 
is a dependent Indian community and thus Indian country under 18 U.S.C. 
Sec.  1151.
---------------------------------------------------------------------------
    The land acquisition regulations (25 C.F.R. Sec.  151.1) 
prohibit the acquisition of land in trust status in Alaska for 
Alaska Natives and tribes (except for the Metlakatla Indian 
Community of the Annette Island Reservation). Since 1978, the 
Department has declined all requests to take land in trust for 
Alaska Natives or Tribes.
    In 1994, several Alaska Villages (Chilkoot Indian 
Association, Native Village of Larsen Bay, Kenaitze Indian 
Tribe) represented by the Native American Rights Fund (NARF) 
submitted a petition requesting that the Department undertake a 
rulemaking to change the existing regulation to allow the 
Secretary to exercise his discretion to acquire land in trust 
for Alaska Natives.
    The Department subsequently published a Notice in the 
Federal Register that it had received the petition and 
requested comments on it by March 6, 1995. Only two comments 
were submitted, and the Department has not undertaken any 
additional actions concerning the petition.

                         bia schools in alaska

    There are 557 federally recognized Tribes in the United 
States. Alaska has 226 of the 557 Federally recognized Tribes--
almost half of the Nation's Tribes.
    Question. How many of the Tribes outside of Alaska have 
been held to possess ``Indian Country''?
    Answer. We are not aware of any federally-recognized Indian 
Tribe in the contiguous 48 states that does not possess some 
Indian country, by virtue of having a reservation, having 
members with trust or restricted allotments, or being a 
dependent Indian community.
    Question. Today, BIA is financially responsible for 185 
elementary, secondary and boarding schools on 63 reservations 
in 23 States. Do each of those reservations have ``Indian 
country''?
    Answer. As noted above, all land within existing Indian 
reservations is Indian country by definition.
    Question. What would be the impact on the BIA budget if the 
Congress did not continue the annual prohibition on BIA funding 
of grant schools in Alaska?
    Answer. Discontinuation of the annual prohibition on BIA 
funding of grant schools in Alaska would not affect the BIA 
budget because there is an annual prohibition on allowing new, 
previously public schools into the BIA school system in all 
regions of the country as well as an annual prohibition on 
allowing schools to expand their grade structures. These 
prohibitions have been necessary, in the recent climate of 
severe fiscal constraint, in order to avoid diminished funding 
for the schools currently in the system.
    Question. If the 226 Alaska Native communities seek 
recognition of their core township land as Indian country, 
could Alaska Natives seek to have their children educated in 
BIA schools?
    Answer. The current prohibition on BIA funded schools in 
Alaska is not related to the issue of Indian country. While at 
one time BIA operated an extensive elementary and secondary 
school system in Alaska, responsibility for educating Alaska 
Natives was transferred to the state over the course of twenty 
years (1966-1985) as a result of an agreement reached with the 
state in 1964. In fiscal year 1982 and 1983, the Congress 
appropriated over $40 million to the State of Alaska for costs 
of upgrading facilities to complete the transition from Bureau 
operated to state operated schools. (These funds were provided 
in addition to routine school operations and facility repair 
funds for the remaining BIA operated schools in Alaska.) The 
transfer of BIA-funded schools to the state culminated in 
Public Law 98-63, the 1985 Appropriations Act, after extensive 
consultation among the state, the BIA, and the Alaska Native 
community. Public Law 98-63 included a permanent legislative 
provision that prohibits the BIA from funding BIA schools in 
the State of Alaska.
    After enactment of Public Law 98-63, the Tribally 
Controlled Schools Act of 1988 (Public Law 100-297), authorized 
a new program of Tribal grant schools and included Alaska 
Native villages within the definition of ``Tribe'' for purposes 
of the program. On May 21, 1993, the Solicitor made a 
determination that Public Law 100-297 requires funding of grant 
schools for those Alaska Native villages that would be able to 
meet the eligibility requirements of the statute. Since fiscal 
year 1994, Congress has enacted annual appropriations language 
prohibiting funding for BIA grant schools in Alaska.
    Furthermore, the moratorium on allowing new, previously 
public schools into the BIA school system in all regions of the 
country would prohibit BIA schools in Alaska, regardless of any 
determination about the existence of Indian country. All Tribes 
are prohibited from bringing new schools into the BIA school 
system.
    Question. What is the estimated cost to restore BIA schools 
for these 226 communities?
    Answer. As noted above, Public Law 98-63 prohibits the BIA 
from funding BIA schools in Alaska. In 1994, Senator Stevens 
requested a GAO report on the estimated costs of BIA schools in 
Alaska. The GAO's estimate at that time was that there were 200 
schools in Alaska with 70 percent or more Alaska native 
students. Should BIA assume responsibility for these schools, 
GAO estimated that annual School Operations costs would range 
from $150 to $190 million annually. However, there is a 
prohibition on allowing any new schools, regardless of the 
states where they are located, into the BIA system.
    Question. The fiscal year 1998 budget request for operation 
of 185 BIA schools is $450 million. That works out to about 
$2.4 million per school annually. Alaska costs are much higher 
than average costs in the ``South 48.'' Have you taken that 
into account in answering the previous question?
    Answer. The 1994 GAO estimate of cost ranged from $150 to 
$190 million to support School Operations in Alaska included a 
25 percent adjustment.
    Question. How much does BIA spend per student under the 
Indian School Equalization Program (ISEP)--which is formula-
based funding for the 185 Bureau operated, grant, contract, 
elementary and secondary schools?
    Answer. The fiscal year 1996 funding level provided about 
$5,300 per student for the ISEP program in School Year 1996-97.
    Question. Has the Administration or the Department of the 
Interior or BIA made any statement relative to resuming 
responsibility for BIA schools in Alaska? If so, please provide 
a copy of any such statement(s) to the Committee.
    Answer. During Conference action on the fiscal year 1995 
Interior Appropriations bill, the Department supported the 
Senate proposal to limit the number of BIA funded schools in 
order to secure stabilized funding for the school system in 
existence at the time. The Conference managers adopted the 
Senate bill language into law. Tribes residing in all states 
are prohibited from bringing new schools into the BIA school 
system. A copy of the fiscal year 1995 effect statement, which 
presents the Department's position, is attached. The Bureau has 
supported the proposal since that time.
                                ------                                


                              Attachment 1

                   effect of house and senate action

    Activity/Subactivity: Other Recurring Programs/Education.
    Bill language which limits the number of Bureau-funded 
schools to 187.
    House action: The House did not address this item.
    Senate bill Language: ``Provided further, That funds made 
available, in this Act and hereafter, for schools funded by the 
Bureau of Indian Affairs shall only be available to the 187 
schools which will be in the Bureau of Indian Affairs school 
system as of September 1, 1995.'' (p. 33, lines 9-13)
    Senate report statement: ``Bill language has been included 
which limits the number of schools to be funded to 186 [sic] 
schools for fiscal year 1995 and future years. With the limited 
resources available to the Committee in fiscal year 1995 and 
for the foreseeable future, the Committee does not support 
adding additional schools which will result in diminished 
funding for schools currently in the system. Given the 
tremendous backlog for facilities maintenance and improvement 
projects and new school construction, the Committee cannot 
support the increased demand for these already insufficient 
resources, which would result by adding more schools to the 
system. This limitation of funding to schools included in the 
fiscal year 1995 budget expands the current exclusion which 
applies only to new schools from Alaska to include all regions 
of the country.'' (p. 58)
    Effect of senate action: The Senate action will help to 
secure stabilized funding for the 187 existing Bureau-funded 
schools.
    Preferred action: The Department strongly recommends that 
the Conference managers adopt the Senate bill and report 
language.

              tribal courts and law enforcement in alaska

    Alaska is a Public Law 83-280 state, under which the state 
has concurrent jurisdiction with the Federal government over 
general criminal and civil matters, even in Indian country.
    Question. Does the position of BIA on Indian country in 
Alaska permit the 226 Native entities to request funds to 
establish tribal court systems?
    Answer.
    Note: The jurisdictional statement presented above requires 
clarification. The State of Alaska exercises jurisdiction that 
is concurrent to the Tribes in Alaska. Public Law 83-280 did 
not divest the tribes of civil or criminal jurisdiction that 
they otherwise possess.
    The Sansonetti opinion specifically recognized the right of 
Alaska Tribes to regulate internal Tribal relations and to 
exercise authorities granted by Congress, including authorities 
under the Indian Child Welfare Act.
    The 1993 opinion of then-Solicitor Sansonetti concluded 
that Alaska Natives possess the same powers and attributes as 
other Indian Tribes, except to the extent limited or preempted 
by Congress, Solicitor's Opinion M-36975. Like Tribes in the 
contiguous 48 states, Tribes in Alaska perform those functions 
and services that have not been limited or preempted by 
Congress. The Bureau of Indian Affairs' policy within Tribal 
Priority Allocations (TPA) is that federal funds awarded to the 
Tribes may be used for Tribal judicial systems. Alaska Tribes 
have and continue to prioritize funds from their TPA base for 
Tribal judicial systems.
    Question. The State of Alaska is responsible for law 
enforcement and detention centers on Alaska Native lands at the 
present time. Please inform this Committee on the procedure in 
states where there is a Tribal court system. Do such states 
continue to provide state services, or are Tribal systems 
deemed solely the responsibility of Tribes?
    Answer. Until such time as the Tribes reassume 
jurisdiction, the states remain responsible for law enforcement 
and detention and Tribes retain jurisdiction which is 
concurrent to that of the state.
    Due to limited funding, Tribes that exercise exclusive 
criminal jurisdiction may elect to contract with states or 
other Tribes for detention services. In non-Public Law 83-280 
states, many Tribes contract with other Tribes and county or 
municipal governments to provide detention services. 
Historically limited funds were prioritized for those Tribes 
exercising exclusive jurisdiction. As a result, Tribes situated 
in Public Law 83-280 states receive a lower allocation of funds 
for courts and law enforcement.
    A significant increase in funding for Tribal Priority 
allocations would provide Public Law 83-280 and non-Public Law 
83-280 Tribes with the resources to develop judicial and law 
enforcement programs. Many Tribes in the contiguous 48 states 
use Tribal development dollars (i.e., gaming, natural resource, 
development) to underwrite a panoply of governmental services 
including judiciaries and law enforcement.
    Question. My staff tell me that Alaska's Tribes have 
already been using some BIA funding--from the Tribal Priority 
Allocations--to fund Tribal justice and law enforcement. Will 
you please detail how much money has been provided and to which 
Tribal entities?
    Answer. The fiscal year 1998 President's Budget Request 
includes $31,137 prioritized by 29 Alaska Tribes and one agency 
to the Tribal Courts program. The Fairbanks agency and the 
following Tribes chose to place funds in their Tribal Courts 
program: Andreafsky, Atmautluak, Chefornak, Marshall, 
Kuigpagmuit, Nightmute, Platinum, Pitka's Point, Kwinhagak, 
Toksook Bay, Tuluksak, Russian Mission, Lower Kalskag, Upper 
Kalskag, Aniak, Chuathbaluk, Lime Village, Kwethluk IRA, 
Orutsaramuit, Mekoryuk, Kipnuk, Akiak, Akiachak, Kasigluk, 
Kwigillinguk, Newtok, Chistochina, Chitina, Mentasta. No Tribes 
chose to prioritize funding to the Law Enforcement program. In 
addition, Self Governance Tribes negotiated $82,200 for Tribal 
judiciaries.
    Question. If Tribes in Alaska take over various functions--
juvenile prosecutions, misdemeanors, alcohol control, child 
custody proceeding, fish and game management, environmental 
enforcement--what funds are available for training and support 
to ensure that these functions are adequately carried out?
    Answer. Because Alaska is a Public Law 83-280, the state 
has general criminal and civil jurisdiction for police and 
courts over Indian country. Tribes retain jurisdiction under 
the 1968 Indian Civil Rights Act over misdemeanors, but only 
those that involve Indians, a limitation imposed by the Supreme 
Court. Under Public Law 83-280, states can retrocede their 
jurisdiction back to Indian Tribes. However, for this to 
happen, the Secretary must consult with the Attorney General 
and agree to accept the retrocession. In recent years, the 
Secretary has declined to accept retrocessions due to the lack 
of federal funding.
    In 1988, the Bureau attempted to deny funding for law 
enforcement services in Public Law 83-280 states, but the 
Congress disagreed, directing that the Bureau continue to 
provide such funding in House Report 100-498, 100th Congress, 
First Session, at 891 (1987).
    At this time the only BIA funds currently available for 
Tribal court and law enforcement programs are the funds which 
Tribes prioritize within their Tribal Priority Allocations base 
budgets. This is true for both Alaska Tribes and Tribes in the 
contiguous 48 states. In order to provide more funds for 
judicial and law enforcement programs, Tribes would have to 
reprioritize resources from other programs. Although this is 
not a viable option, it is the only option available at this 
time.
    Currently the State of Alaska is responsible for providing 
law enforcement and detention services on Alaska Native lands. 
The Alaska State Police have developed the Village Public 
Safety Officers (VPSO) program in which local village members 
are provided minimal public safety training and can act as 
first responders to calls for service but they are not 
certified law enforcement officers.
    Question. Alaska Tribes believe Indian country will enable 
Alaska Natives to assume jurisdiction to control the sale of 
alcohol and prosecute those who violate Tribal law. Does the 
BIA have any agreement with the Justice Department regarding 
providing prosecution to back up the Tribes' efforts to do 
their own alcohol control programs?
    Answer. Three villages have liquor control ordinances that 
have been approved and published in the Federal Register as 
required by 18 U.S.C. Sec.  1154. See Chalkyitski, 48 Federal 
Register 21373 (May 12, 1983); Northway, 48 Federal Register 
30195 (June 30, 1983); and Minto, 51 Federal Register 28779 
(August 11, 1986). Many villages wish to affirm that the 
possession, sale and consumption of liquor is illegal. Like 
many Public Law 83-280 Tribes in the contiguous 48 states, 
villages may wish to impose civil, rather than criminal, 
penalties including impoundment, fines and exclusion.
    The Bureau does not have an agreement with the Department 
of Justice to enforce village liquor control ordinances. 
However, the villages may wish to enter into agreements with 
the Assistant United States Attorneys to enforce 18 U.S.C. 
Sec.  1154 which prohibits the sale, possession and consumption 
of alcohol within Indian country.
    Question. Last Congress during passage of welfare reform 
legislation, I offered an amendment, which was accepted, 
limiting Native administration of welfare programs in Alaska to 
the 12 regional non profit corporations and Metlakatla. I took 
this step to make sure that the maximum amount of limited 
federal dollars for needy families would go to provision of 
services, and to avoid unnecessarily high administrative costs 
in a block grant environment. At the time I proposed my 
amendment, I consulted with Native groups in Alaska and gained 
their agreement. Since passage of the welfare reform 
legislation, Native regional non profit corporations have been 
working with the State of Alaska to coordinate development of 
their programs.
    Now I understand the BIA has successfully urged the Justice 
Department to request that my amendment be deleted as part of 
the Administration's comments to the House Ways and Means 
Committee on its technical corrections bill. None of the Alaska 
Congressional delegation have been contacted on this matter by 
either Justice or BIA. I also understand that the Department of 
Health and Human Services, which administers welfare, does not 
have problems with my amendment.
    Please explain (1) the rationale for BIA's objections; and 
(2) why the Alaska Congressional delegation was neither 
notified nor consulted.
    Answer. The Bureau is one of several federal agencies that 
offered recommendations to the Department of Health and Human 
Services (DHHS), the lead agency for welfare reform. The 
Secretary of Health and Human Services and the Commissioner of 
the Social Security Administration proposed technical and 
conforming amendments to the Personal Responsibility and Work 
Opportunity Reconciliation Act of 1996 (PRWORA) in a letter to 
the Chairman of the Committee on Finance dated December 16, 
1996. Among the proposals was a request to amend Section 419A 
of the Social Security Act (as added by section 103(a) of 
PRWORA).
    The Bureau recommended that the Section 419A of the Social 
Security Act definition of Indian, Indian Tribe and Tribal 
organization have the meaning given such terms by section 4 of 
the Indian Self Determination and Education Assistance Act (25 
U.S.C. 450b). The DHHS Child Care Bureau expressed concern that 
the portion of Child Care Development Block Grants (CCDBG) 
funding transferred from the TANF program under section 418 
would make impossible, in the case of Alaska Natives, operation 
of a single unified child care program.
    The Bureau's concern, and that of DHHS, was the 
government's liability. This concern was expressed to the 
Alaska delegation on several occasions. For example, in a 
meeting on February 5, 1997, with Liz Connell of the Committee 
staff and Martha Stewart of the Governor's staff, we discussed 
the constitutionality of special statutes for Indian Tribes and 
the risk of litigation for the DHHS when entities that are not 
on the list of federally recognized Indian Tribes are included 
by definition while federally recognized Tribes are excluded. 
It was recommended to Ms. Connell that limitations in eligible 
beneficiaries be accompanied by sufficient legislative history 
to support the exclusion of beneficiaries that are otherwise 
recognized by special statutes.
    Question. Under 25 U.S.C. Sec.  450b, in the Indian Self 
Determination Act, Indian Tribe in Alaska is described as ``any 
Alaska Native village or regional or village corporation as 
defined in or established pursuant to the Alaska Native Claims 
Settlement Act [43 U.S.C.A. Sec.  1601 et. seq.] * * *.'' 
Nothing in that law ranks one type of organization over 
another. Yet, I continue to hear that BIA creates obstacles for 
regional corporations or their designees and continues to give 
preference to ``Alaska Tribes'' in 638 contracts and compacts. 
What is the legal justification for BIA's apparent policy and 
what is its history?
    Answer. Inclusion on the Indian entities list demonstrates 
that the Secretary unequivocally recognizes the Tribal status 
of the listed villages and regional Tribes that are 
acknowledged to have ``the immunities and privileges available 
to other federally acknowledged Indian Tribes by virtue of 
their government-to-government relationship with the United 
States as well as the responsibilities, powers, limitations and 
obligations of such Tribes'' (25 C.F.R. Sec.  83.2). Inclusion 
on the list does not resolve the scope of powers of any 
particular Tribe over land or non-members. It only establishes 
that the listed Tribes have the same privileges, immunities, 
responsibilities and obligations as other Indian Tribes under 
the same or similar circumstances including the right, subject 
to general principles of Federal Indian law, to exercise the 
same inherent and delegated authorities available to other 
Tribes. This position was confirmed by Congress when it enacted 
the ``Federally Recognized Indian Tribe List Act of 1994''.
    Although regional, village, and urban corporations 
organized under state law in accordance with the Alaska Native 
Claims Settlement Act (ANCSA) (43 U.S.C. Sec.  1601 et seq.) 
may be designated as ``Tribes'' for the purposes of some 
federal laws, primarily the Indian Self Determination and 
Education Assistance Act (ISDA), 25 U.S.C. 450(b), they are not 
included on the Departmental list of villages and regional 
Tribes which the Department believes to have functioned as 
political entities, exercising governmental authority. The 
membership of the corporations is defined by a property 
interest. However, village members are in a political 
relationship which is the constitutional foundation for the 
federal programs available to Indians. Morton v. Mancari, 417 
U.S. 535 (1974). The Bureau's policy was recently upheld in 
Cook Inlet Treaty Tribes v Shalala, No. A94-0589-CV (HRH) (D. 
Alaska January 6, 1997).
    Question. I have been made aware that the Central Office of 
the BIA has recently requested a position paper from the Juneau 
Area Office explaining why tribal organizations in urban areas 
of Alaska are entitled to contract/compact under Public Law 93-
638. We have a long standing history in Alaska of contracting 
in these communities.
    Who is seeking this position paper? For what purpose? With 
what intentions? Is the Bureau attempting to reverse more than 
20 years of precedent in Alaska?
    Answer. The Bureau's Office of Tribal Services inquired of 
the Juneau Area the history of how the service area in Alaska 
has been determined. The inquiry was for information purposes 
only.
                                ------                                


                 Question Submitted by Senator Cochran

    The Mississippi Band of Choctaw Indians has two 1930's era 
schools which are overcrowded and unsafe and are in danger of 
losing accreditation because of the deficient and failing 
facilities The BIA priority list for new school construction 
has been frozen for several years; schools on the list are 
still waiting for progress in planning, design or construction; 
schools not on the list, but in need, have no realistic chance 
of action in the foreseeable future. Since the new school 
construction program is proceeding so slowly, the Tribe has 
proposed a fifty percent cost sharing arrangement with the BIA 
for the replacement of the schools. This request was turned 
down by the BIA.
    Question. What can be done to allow a Tribe such as the 
Mississippi Band of Choctaw Indians to pursue a method of 
matching federal funds with tribal funds for school 
construction?
    Answer. The legislative report accompanying the fiscal year 
1994 Interior Appropriations Act requested that the Department 
conduct a study of alternative funding. A Report was submitted 
to the Committee in July 1994. Although the study group 
explored over 20 conceivable options, unfortunately, no 
acceptable method was found at that time mainly because lease 
options, loans and bonding require repayment which is subject 
to appropriation. In the fiscal year 1996 budget the Bureau 
requested appropriations for a pilot project for alternative 
funding. The Omnibus Appropriations Act for fiscal year 1996 
did not include funding for this project.
    The BIA continues to explore a number of alternatives that 
may in the future provide viable means to facilitate more 
construction and repair of high priority BIA ranked projects, 
as described below.
    (1) Cost sharing of construction expenses by the tribes/
schools and BIA for repair or replacement of existing 
facilities.
    (2) Bonding legislation that would be available to the 
Tribes and acceptable to OMB, DOI, and BIA.
    (3) Support of the Administration school reconstruction 
initiative, which proposes $5 billion dollars over four years 
for nationwide school construction and renovation, with a set-
aside provided for Indian schools.
    (4) Expanded use of the existing portable classroom program 
to address problem areas such as increased enrollment, 
programmatic space, and unsafe and unhealthy classrooms.
    (5) A Lease-purchase program has been considered in the 
past, however, due to the scoring requirements by OMB it was 
determined infeasible. Legislation and/or policy changes could 
enhance prospects for this alternative in the future.
    The above are some of the alternatives that, if they were 
appropriately structured and become available, would stretch 
the BIA construction dollars to cover more projects. At the 
present rate of deterioration and with a constrained budget 
that has not kept up with aging buildings, more emphasis will 
continue to be placed on addressing the most critical 
deficiencies that exist in a particular building/facility.
    In addition, the Bureau's Office of Indian Education 
Programs and Facilities Management and Construction Center have 
discussed alternative funding and intend to consult on the 
matter in the summer consultation meetings with Tribes.
    The Administration has requested $5 billion to address 
facility repair needs for public schools across America with a 
two percent set-aside for the Department of Interior. This 
resource combined with the Bureau's education construction 
budget request will help eliminate the ever-growing backlog of 
repairs in these schools.
    Unfortunately, both the Bureau's and the Department's 
efforts to explore alternative financing options have resulted 
in the finding that there are not many opportunities, mainly 
because lease arrangements, loans, and revenue bonds require 
repayment which is subject to appropriation. The chief way to 
ensure that education construction needs are met is through 
increased appropriations.
                                ------                                


                 Questions Submitted by Senator Dorgan

            child protection and family violence prevention

    Question. I am extremely concerned that the Bureau's fiscal 
year 1998 budget request includes no funding for Child 
Protection and Family Violence Prevention under theTribal 
Priority Allocations account. Can you explain how this decision 
was arrived at and what steps the BIA is taking to ensure that 
the prevention of child abuse and neglect is a top priority?
    Answer. In the Bureau's fiscal year 1998 budget, a separate 
line item is requested for Child Protection and Family Violence 
Prevention under the Tribal Priority Allocation (TPA) budget 
activity. This decision was made to give Tribes the ability to 
make prevention a high priority within TPA and redistribute 
funds from other TPA programs or from overall or general 
increases included in appropriations enacted for TPA into this 
new line item. The Bureau is required by the Indian Self 
Determination Act, as amended, to conduct national budget 
hearings with Tribal representatives from the Bureau's twelve 
Area Offices. National Tribal funding priorities are 
communicated to the Bureau at these Hearings. Over the past few 
years, the Tribes have listed TPA programs as their highest 
priority. These national Tribal funding priorities become the 
Bureau's priorities in the submission of the initial annual 
budget request to the Department of the Interior. General 
increases in TPA have been requested so that Tribes can 
prioritize resources to meet their needs at the local level. 
The Bureau has held six annual National Budget Hearings, 
beginning in 1992. The Bureau will continue to support this 
process. Individual Tribes establish individual priorities.
    The Bureau's fiscal year 1998 budget includes a proposed 
general increase of $46.7 million for TPA. If the increase is 
appropriated, Tribes can fund a variety a programs including 
child protection.

                          school construction

    Question. The Ojibwa Indian School, located on the Turtle 
Mountain Reservation, is in desperate need of a new permanent 
facility. There are severe safety deficiencies, asbestos, and 
structural problems in the School's three buildings. In fact, 
the BIA decided in 1994 that these buildings, housing 150 
students, had to be evacuated and the students had to be 
relocated to temporary portable classroom units. However, the 
School currently is not on the BIA's Education Construction 
priority list. Even if it were, though, it would be many years 
before a new school could be built and students could have the 
opportunity to learn in a safe environment. What actions will 
the Bureau take to ensure that the severe education 
construction needs on Indian reservations will be met in a more 
timely fashion, either through creative financing mechanisms 
which would use existing construction and repair funding or 
other proposals?
    Answer. The Bureau is very concerned about the safety 
deficiencies in the Ojibwa and many other Bureau school 
facilities. Of the total backlog of Bureau facility repairs 
($890 million), $682 million is needed for education 
facilities; $62 million is needed for education quarters; $121 
million is needed for non-education facilities; and $25 million 
is needed for non-education quarters. The new school priority 
list of 16 schools, approved by Congress in fiscal year 1993, 
remains frozen until all schools are funded. The Bureau has 
completed construction of seven new schools. Funding for the 
construction of the Many Farms High School, requested annually 
since fiscal year 1996, has yet to be funded by the Congress.
    The BIA continues to explore a number of alternatives that 
may in the future provide viable means to facilitate more 
construction and repair of high priority BIA ranked projects, 
as described below.
    (1) Cost sharing of construction expenses by the Tribes/
schools and BIA for repair or replacement of existing 
facilities.
    (2) Bonding legislation that would be available to the 
Tribes and acceptable to OMB, DOI and BIA.
    (3) Support of the Administration school reconstruction 
initiative, which proposes $5 billion dollars over four years 
for nationwide school construction and renovation, with a set-
aside provided for Indian schools.
    (4) Expanded use of the existing portable classroom program 
to address problem areas such as increased enrollment, 
programmatic space, and unsafe and unhealthy classrooms.
    (5) A lease-purchase program has been considered in the 
past, however, due to the scoring requirements by OMB it was 
determined infeasible. Legislation and/or policy changes could 
enhance prospects for this alternative in the future.
    The above are some of the alternatives that, if they were 
appropriately structured and become available, would stretch 
the BIA construction dollars to cover more projects. 
Unfortunately, both the Bureau's and the Department's efforts 
to explore alternative financing options have resulted in the 
finding that there are not many opportunities, mainly because 
lease arrangements, loans, and revenue bonds require repayment 
which is subject to appropriation.
    In addition, the Bureau's Office of Indian Education 
Programs and Facilities Management and Construction Center have 
discussed alternative funding and intend to consult on the 
matter in the summer consultation meetings with Tribes.
    The Administration has requested $5 billion to address 
facility repair needs for public schools across America with a 
two percent set-aside for the Department of Interior. This 
resource combined with the Bureau's education construction 
budget request will help eliminate the ever-growing backlog of 
repairs in these schools.
    At the present rate of deterioration and with a constrained 
budget that has not kept up with aging buildings, emphasis will 
continue to be placed on addressing the most critical 
deficiencies that exist in a particular building/facility. The 
liability risks to the federal government are serious and 
potentially very costly. At the current time, however, the 
chief way to ensure that there are sufficient and adequate 
educational facilities in Indian Country is through increased 
appropriations.

                 law enforcement facility construction

    Question. The need for correctional facilities in Indian 
Country far exceeds existing resources. For example, on the 
Fort Berthold Reservation, there are 3,000 arrests annually, 
but the jail facility that the BIA leases only houses 8 
inmates. Due to this situation, there essentially is no 
deterrence to crime on the reservation. I am disappointed that, 
despite the substantial backlog in construction projects, the 
fiscal year 1998 budget request contains only $9.1 million to 
construct a jail in Colorado for a Tribe that has been court-
ordered to immediately address serious facility problems. Can 
you explain what steps the BIA will immediately take to ensure 
that there are sufficient and adequate correctional facilities 
in Indian Country?
    Answer. The Bureau strongly agrees that the need for 
correctional facilities far exceeds existing resources and that 
current facilities are inadequate, overcrowded and outdated. 
The Bureau has sought a coordinated effort by Tribal leadership 
and federal agencies to convince Congress to provide funding 
necessary to build many more adult and juvenile detention 
facilities. Despite this effort, Congress eliminated funding 
for jail construction for fiscal years 1995 through 1997.
    The Bureau is aware of and very concerned about the jail 
facility for the Three Affiliated Tribes, as well as the 
facilities for other Tribes on the Detention Center Priority 
List (list). As the Senator points out, the Ute Mountain 
facility is currently under federal court order to address 
serious health and safety related facility repairs. The fiscal 
year 1998 budget is the third year the Bureau has sought 
funding to construct the Ute Mountain Ute facility, number 5 on 
the list. The Three Affiliated Tribes jail facility is number 
17 on the list. There are facilities ahead of the Three 
Affiliated Tribes awaiting design completion and construction 
funding. No funds have been appropriated for law enforcement 
facility construction since fiscal year 1995. The Bureau can 
only ensure that there are sufficient and adequate correctional 
facilities in Indian country if additional appropriations are 
provided.

                        circle of nations school

    Question. In December, the ND Congressional delegation 
wrote to Secretary Babbitt and OMB Director Raines to urge the 
Administration to secure additional resources for the 
therapeutic model program at the Circle of Nations School in 
Wahpeton, North Dakota. The fiscal year 1998 budget request 
contains no additional dollars. What steps will the BIA take to 
allocate existing or new resources to ensure that the special 
educational, health and psychological needs of the students at 
the Circle of Nations School are met and to ensure the creation 
of a viable model for other Indian educational institutions?
    Answer. The Bureau is aware of the school's effort to 
implement a therapeutic model program. In 1993, 1994, and 1995 
the Bureau has provided additional funds to the school for 
purposes of implementing the model. The additional funds 
provided were above what the ISEP formula generated for the 
school. Due to current fiscal constraints, the Bureau can no 
long provide additional support to the school without 
negatively affecting other Bureau schools. In an effort to help 
the school, the Bureau staff will be working with the school to 
explore several other options such as third party payments for 
some of the children they accept, outside funding from local, 
State, Federal and Tribal organizations whose children attend 
the school and new funding from private foundations. The BIA 
will do all it can to promote the efforts of the school, 
including collaboration with Indian Health Service officials, 
in implementation of the model.

                      impact of funding reductions

    Question. Chairman Russell Mason of the Three Affiliated 
Tribes in North Dakota has contacted me about the negative 
impact that the fiscal year 1997 funding reductions in Tribal 
Priority Allocations has had on social services, tribal court, 
and higher education scholarship programs. What is the actual 
amount allocated to Area Office administration of each of the 
functions and activities related to the programs listed above? 
What is the Area Office reduction compared to agency and tribal 
level reductions in each of these programs?
    Answer. There are no funds allocated to Area Office 
administration for each of the functions and activities related 
to the social services, tribal courts, and higher education 
scholarship programs. These programs are operated by the Tribe 
through Public Law 93-638 contacts funded within the Tribal 
Priority Allocations (TPA) budget activity. The following table 
illustrates the funds allotted to the programs based on the 
Tribe's priorities.

                                                    FUNDS ALLOCATED TO PROGRAMS OF TRIBE'S PRIORITIES                                                   
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                        Fiscal year--                                   
                                                                    ------------------------------------------------------------------------------------
                                                                           1995                              1996                              1997     
                                                                      appropriation     1996 request    appropriation     1997 request    appropriation 
--------------------------------------------------------------------------------------------------------------------------------------------------------
Social services....................................................         $349,700         $358,600         $345,100         $500,300         $350,300
Scholarships.......................................................          489,300          512,600          452,800          600,900          494,800
Tribal courts......................................................          303,200          311,900          254,300          368,000          275,800
                                                                    ------------------------------------------------------------------------------------
      Total........................................................        1,142,200        1,183,100        1,052,200        1,469,200        1,120,900
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The modest increase provided in 1997 following the 1996 
Conference mark did not bring the overall TPA funding back to 
the 1995 level, which has exacerbated the Tribe's shortfall in 
delivery of these program services.
    Each program under Area Office Operations received an 
equitable reduction of approximately 29 percent in fiscal year 
1996. For fiscal year 1997 there was a reduction of 
approximately 1.7 percent. The following is a comparison of the 
Aberdeen and Bureau wide Area Office Operations recent funding:

                           FUNDING FOR ABERDEEN AND BUREAUWIDE AREA OFFICE OPERATIONS                           
----------------------------------------------------------------------------------------------------------------
                                                                   Fiscal year--                                
                                 -------------------------------------------------------------------------------
                                       1995                            1996                            1997     
                                   appropriation   1996 request    appropriation   1997 request    appropriation
----------------------------------------------------------------------------------------------------------------
Aberdeen........................      $5,883,000      $4,434,000      $4,586,000      $3,485,000      $4,279,000
Bureauwide......................      54,617,000      54,994,000      36,714,000      36,562,000      38,861,000
----------------------------------------------------------------------------------------------------------------

                   National Indian Gaming Commission

STATEMENT OF ADA E. DEER, ACTING CHAIR
ACCOMPANIED BY:
        JOSEPH DUTZ, CHIEF FINANCIAL OFFICER
        ALAN FEDMAN, DIRECTOR OF ENFORCEMENT

                             budget request

    Senator Gorton. Now, I understand that, because we do not 
have the Director, you are going to wear the Indian Gaming 
Commission hat today for our hearing, too?
    Ms. Deer. That is right. I am the interim Chair of the 
Gaming Commission.
    Senator Gorton. Do you have any statement that you would 
like to make as we move into that area?
    Ms. Deer. Yes; I do.
    Senator Gorton. OK, please proceed.

                 summary statement of hon. ada e. deer

    Ms. Deer. Mr. Chairman, members of the committee: Thank you 
for the opportunity----
    Senator Gorton. You are back to one again. [Laughter.]
    Ms. Deer. Thank you for the opportunity to appear before 
you to testify on the fiscal year 1998 budget request of the 
National Indian Gaming Commission. My name is Ada Deer. I am 
the Acting Chair of the Indian Gaming Commission, and with me 
today are members of the NIGC staff: Mr. Joe Dutz, who is the 
Chief Financial Officer, and Mr. Alan Fedman, who is the 
Director of Enforcement. I also wanted to recognize the two 
Associate Commissioners who are here, Mr. Tom Foley from 
Minnesota and Mr. Phil Hogen from South Dakota. Pursuant to 25 
U.S.C. 2706[a][1], the budget for fiscal year 1998 was 
unanimously approved by the Commission.
    With your permission, Mr. Chair, I would like to make brief 
opening remarks and submit my written statement for the record.
    Senator Gorton. Certainly.
    Ms. Deer. Gaming activity has been conducted on Indian 
lands for close to 20 years. Briefly, it has been almost 10 
years since Congress passed the Indian Gaming Regulatory Act 
that created the NIGC, and there has been an immense change in 
the industry during that time period. In just the past 5 years, 
Indian gaming activity and revenues have more than doubled.
    If you would look at the first chart, you will see that 
Indian gaming revenue has grown from just over $2 million in 
1993 to over $5 billion in 1995. During that same time period, 
the funding and the staff of the NIGC have remained relatively 
constant.



                    Indian gaming operations revenues

        Fiscal year                                             Billions
1993..............................................................  $2.2
1994..............................................................   3.2
1995..............................................................   5.3



                              nigc mission

    The mission of the NIGC, in keeping with the declaration of 
policy of the Indian Gaming Regulatory Act, is to ensure that 
Indian gaming is regulated, to shield it from organized crime 
and other corrupting influences, to ensure that the Indian 
tribe is the primary beneficiary of the gaming operation, and 
to assure that gaming is conducted fairly and honestly by both 
the operator and the player.
    Currently the 33-person NIGC staff is responsible for 
monitoring and regulating gaming in 273 tribal gaming 
establishments operated by 183 tribes in 28 States. Tribal 
governments share in the responsibility for the day to day 
regulation of class II gaming, while many aspects of the 
regulation of class III gaming are controlled by tribal-State 
compacts.
    The NIGC undertakes this regulatory responsibility with an 
operating budget of $4.4 million. In fiscal year 1997 the NIGC 
is undertaking this regulatory responsibility with an operating 
budget of $4.4 million, comprised of a $1 million direct 
appropriation, $1.5 million in fees assessed on class II tribal 
gaming revenue, investigative fees, and unobligated funds from 
prior years.
    It is expected that these prior year funds will be nearly 
depleted at the conclusion of fiscal year 1997, leaving the 
NIGC with anticipated revenue of between $2.5 million and $3 
million in fiscal year 1998. To adequately meet its 
responsibilities under IGRA, NIGC needs additional funds that 
should be obtained through additional user fees, rather than 
through additional appropriations.
    For the last 2 years, NIGC has assessed fees on class II 
tribal gaming at a rate of 0.5 percent of gross revenue. IGRA 
permits assessments under a two-tier scheme, with rates ranging 
from zero to 5 percent. However, there is a $1.5 million 
statutory limitation on the amount of fees that NIGC can assess 
annually on tribal gaming gross revenue. Raising or eliminating 
the statutory cap would permit NIGC to assess fees at a rate in 
keeping with IGRA that would generate additional operating 
funds.
    Assessing fees on class III gaming is another potential 
source of funds for NIGC. Currently NIGC is permitted to assess 
fees only on class II gaming revenue, even though many of our 
enforcement actions involve class III facilities.
    As the next three charts indicate, the majority of our 
activities involve class III gaming ordinances, management 
contracts, and especially enforcement contracts during the past 
year and a half. Being permitted to assess fees on class III 
gaming revenue would help defray the expense of enforcing and 
litigating class III aspects of IGRA.



            Chart 1.--Approved ordinances--by type of gaming

Class II and III, and III only (percent).......................... 84.47
Class II only (percent)........................................... 15.53
                        -----------------------------------------------------------------
                        ________________________________________________
      Total, percent..............................................100.00
                        =================================================================
                        ________________________________________________
Class II and III, and III only....................................   185
Class II only.....................................................    34





    Chart 2.--Approved gaming management contracts--by type of gaming

Class II and III, and III only (percent).......................... 79.17
Class II only (percent)........................................... 20.83
                        -----------------------------------------------------------------
                        ________________________________________________
    Total percent.................................................100.00
                        =================================================================
                        ________________________________________________
Class II and III, and III only....................................    19
Class II only.....................................................     5





           Chart 3.--Enforcement actions\1\--by type of gaming

Class II and III, and III only (percent).......................... 96.67
Class II only (percent)...........................................  3.33
                        -----------------------------------------------------------------
                        ________________________________________________
    Total percent.................................................100.00
                        =================================================================
                        ________________________________________________
Class II and III, and III only....................................    29
Class II only.....................................................     1

\1\ Since NIGC reorganization in 1996.
---------------------------------------------------------------------------



                          status of activities

    NIGC is working with the administration on legislation to 
submit to Congress that incorporates both these concepts. Given 
the scope of the responsibilities of NIGC, as well as the 
growth of the Indian gaming industry, now is the time to ensure 
that NIGC has sufficient funds to fulfil its statutory 
responsibilities.
    In the conference report accompanying the 1996 
appropriations, NIGC was instructed to submit a report to the 
Secretary of the Interior detailing tribal compliance with 
IGRA. The first report documenting compliance as of September 
30, 1996, was sent to the Secretary in November 1996. Few 
tribes were in compliance with all of the items covered in the 
report. However, the report showed that each of the eight 
categories had a compliance rate of at least 50 percent.
    NIGC is committed to 100 percent compliance with IGRA. I 
believe that the tribes also are committed to this goal. That 
commitment is apparent in the preliminary results of the March 
31, 1997, report. As the next two charts show, the next report 
should indicate that there is over 60 percent compliance in 
each category and almost 40 percent of gaming operations are in 
compliance with IGRA. As soon as the report is finalized and 
printed, we will be sending it to you.



                                            GAMING TRIBES INFORMATION                                           
                                                  [In percent]                                                  
----------------------------------------------------------------------------------------------------------------
                                                                                                   Mar. 31, 1997
                                                                  Sept. 31, 1996   Dec. 31, 1996        \1\     
----------------------------------------------------------------------------------------------------------------
Approved compacts...............................................            0.62            0.63            0.70
Investigative reports...........................................             .49             .80             .87
Fingerprint cards...............................................             .76             .90             .97
Employee applications...........................................             .56             .79             .90
Approved ordinances.............................................             .97             .98             .98
----------------------------------------------------------------------------------------------------------------
\1\ Estimated.                                                                                                  





                                             OPERATIONS INFORMATION                                             
                                                  [In percent]                                                  
----------------------------------------------------------------------------------------------------------------
                                                                                                   \1\ Mar. 31, 
                                                                  Sept. 31, 1996   Dec. 31, 1996       1997     
----------------------------------------------------------------------------------------------------------------
Submit fees.....................................................            0.55            0.45            0.79
Licensed by tribe...............................................             .56             .82             .90
Submit audits...................................................             .61             .66             .86
----------------------------------------------------------------------------------------------------------------
\1\ Estimated.                                                                                                  



                         enforcement activities

    From 1991 to 1996, NIGC issued eight formal enforcement 
documents. Since the beginning of 1996 when NIGC underwent a 
reorganization, the NIGC has opened 30 new enforcement cases 
and issued eight notices of violation.
    In addition to these formal enforcement actions, NIGC also 
worked with tribes to resolve a number of disputes that 
threatened the financial integrity of the gaming operations. 
These included disputes between the tribe and its management 
contractor, as well as disputes between rival factions within a 
tribe.
    NIGC expects a further acceleration of its enforcement 
program during the next 6 months. The NIGC will continue to 
give enforcement priority to cases involving individuals and 
companies managing tribal gaming operations without an approved 
management contract and will continue to investigate and take 
action against gaming operations offering class III gaming 
without approved tribal-State compacts.
    During the last year, NIGC has undergone a number of 
changes. The staff has been reorganized, budget and management 
review processes have been undertaken, and personnel, internal 
management, and travel procedures in keeping with applicable 
Federal law and regulations have been implemented.
    With each of these actions, it has become increasingly 
apparent that the NIGC needs additional funds to fulfill its 
mandate to enforce IGRA. It is my hope that you will support 
our fiscal year 1998 budget request of $1 million and our 
legislative efforts to lift or eliminate the statutory cap on 
fees and to include class III gaming revenue in the fee 
assessment structure.

                           prepared statement

    I believe that, with the increased funds our legislative 
initiative will raise, the next chair of the NIGC will be able 
to expand the enforcement of the Indian Gaming Regulatory Act 
to better accomplish the agency's regulatory mission.
    Thank you and we welcome your questions.
    [The statement follows:]

                 Prepared Statement of Hon. Ada E. Deer

    Mr. Chairman, Members of the Committee, thank you for the 
opportunity to appear before you today to testify on the fiscal 
year 1998 Budget Request of the National Indian Gaming 
Commission. My name is Ada E. Deer, and I am the Acting Chair 
of the National Indian Gaming Commission (NIGC). The budget 
submitted to you for Fiscal 1998, pursuant to 25 U.S.C. Sec.  
2706(a)(1), was unanimously approved by the Commission.
    Gaming activity has been conducted on Indian lands for 
close to twenty years. Briefly, it has been almost ten years 
since Congress passed the Indian Gaming Regulatory Act (IGRA) 
that created the NIGC and there has been an immense change in 
the industry during that time period. In just the past five 
years Indian gaming activity and revenues have more than 
doubled. During that same time period the funding and the staff 
of the NIGC have remained relatively constant.
    The mission of the NIGC, in keeping with the declaration of 
policy of the IGRA, is to ensure that Indian gaming is 
regulated, ``to shield it from organized crime and other 
corrupting influences, to ensure that the Indian tribe is the 
primary beneficiary of the gaming operation and to assure that 
gaming is conducted fairly and honestly by both the operator 
and the player.''
    Currently, the NIGC is responsible for monitoring and 
regulating gaming in 273 tribal gaming establishments operated 
by 183 tribes in 28 states. Tribal governments share in the 
responsibility for the day-to-day regulation of class II 
gaming, while many aspects of the regulation of class III 
gaming are controlled by tribal/state compacts.
    The 33 person staff of the NIGC is responsible for: (1) 
monitoring gaming operations on a continuing basis; (2) 
approving all contracts for the management of gaming operations 
by non-tribal parties; (3) conducting background investigations 
on individuals and entities with a financial interest in, or 
management responsibility for, a class II or a combined class 
II/III gaming management contract; (4) approving all gaming 
related tribal ordinances; (5) reviewing background 
investigations of key gaming employees conducted by the tribes; 
(6) reviewing and conducting audits of the books and records of 
the gaming operations; and (7) initiating enforcement actions 
to help ensure the integrity of Indian gaming operations.
    In fiscal year 1997, the NIGC is undertaking this 
regulatory responsibility with an operating budget of $4.4 
million comprised of a $1,000,000 direct appropriation, 
$1,500,000 in fees assessed on class II tribal gaming revenue, 
investigative fees and unobligated funds from prior years. It 
is expected that these prior year funds will be nearly depleted 
at the conclusion of fiscal year 1997, leaving the NIGC with 
anticipated revenue of between $2.5 and $3 million in fiscal 
year 1998.
    To adequately meet its responsibilities under the IGRA, the 
NIGC needs additional funds that should be obtained through 
additional user fees rather than through additional 
appropriations. For the last two years, the NIGC has assessed 
class II tribal gaming at a rate of 0.5 percent of gross 
revenue. The IGRA permits assessments under a two-tier scheme 
with rates ranging from zero to 5 percent. However, there is a 
$1,500,000 statutory limitation on the amount of fees the NIGC 
can assess annually on tribal gaming gross revenue. Raising or 
eliminating the statutory cap would permit the NIGC to assess 
fees at a rate, in keeping with the IGRA, that would generate 
additional agency operating funds.
    Assessing fees on class III gaming is another potential 
source of funds for the NIGC. Currently, the NIGC is permitted 
to assess fees only on class II gaming revenue even though many 
of our enforcement actions involve class III facilities. Being 
permitted to assess fees on class III gaming revenue would help 
defray the expense of enforcing and litigating class III 
aspects of the IGRA.
    The NIGC is working with the Administration on legislation 
to submit to Congress that incorporates both of these concepts. 
Given the scope of the responsibilities of the NIGC, as well as 
the growth of the Indian gaming industry, now is the time to 
ensure that the NIGC has sufficient funds to fulfill its 
statutory responsibilities.

                          compliance with igra

    In the Conference Report to H.R. 3019, the Appropriations 
for fiscal year 1996, the NIGC was instructed to submit a 
report to the Secretary of the Interior: ``detailing those 
Indian tribes or tribal organizations with gaming operations 
that are in full compliance, partial compliance, or non 
compliance with the provisions of the Indian Gaming Regulatory 
Act (25 U.S.C. 2701 et seq.).''
    The first report, documenting compliance as of September 
30, 1996, was sent to the Secretary in November 1996. It 
covered the major compliance obligations for gaming tribes, 
including: (1) obtaining a tribal-state compact approved by the 
Secretary of the Interior (DOI) prior to conducting class III 
gaming; (2) submitting investigative reports and suitability 
determinations on each key employee and primary management 
official summarizing the results of the tribal background 
investigation; (3) submitting finger print cards to the NIGC 
for processing; (4) submitting gaming employee applications to 
the NIGC at the commencement of employment; (5) adopting a 
gaming ordinance that has been approved by the NIGC; (6) paying 
a fee assessment to the NIGC based on class II revenues; (7) 
issuing a separate license for each facility where gaming is 
conducted; and (8) submitting an annual independent audit of 
the gaming operation to the NIGC. Few tribes were in compliance 
with all of the items covered in the report; however, the 
report showed that each of the eight categories had a 
compliance rate of at least 50 percent.
    The NIGC is committed to 100 percent compliance with the 
IGRA. Due to limited resources, voluntary compliance with the 
IGRA has been emphasized by the NIGC. This emphasis and agency 
outreach efforts were increased after the first report. Those 
efforts utilized the majority of NIGC enforcement resources and 
included letters and telephone calls to each tribe as well as 
on site visits where possible. In addition, the NIGC held a 
compliance workshop in January to outline compliance 
procedures. More than three hundred representatives of seventy 
tribes were in attendance. At that workshop, it was announced 
that any tribe not in compliance as of March 31, 1997, would be 
subject to enforcement action unless they had executed a 
memorandum of understanding (MOU) with the NIGC to come into 
compliance by an agreed upon date. Depending on the severity of 
the violation, NIGC enforcement action for non compliance could 
be the issuance of a closure order or a civil fine of up to 
$25,000 a day for each violation by a tribe.
    In late March, the NIGC released the results of the report 
for the period ending December 31, 1996. Although there was 
substantial improvement in certain categories, especially those 
involving background investigations, the level of total 
compliance was still low. It is our hope that the next report, 
which will be as of March 31, 1997, will show that more than 50 
percent of operations are in total compliance with the IGRA.

                              enforcement

    From 1991 to 1996, the NIGC issued eight formal enforcement 
documents. Since the beginning of 1996, when the NIGC underwent 
a reorganization, the NIGC has opened 30 new enforcement cases 
and issued eight Notices of Violation. These cases address a 
wide range of violations including: tribes that have failed to 
perform background investigations on key employees, tribes that 
are operating without an approved ordinance, operations engaged 
in illegal pull tab sales, operations which are not licensed by 
the tribe, tribes conducting class III gaming without a compact 
with the state, operations being managed by contractors whose 
agreements have not been approved, and operations maintained in 
a manner that could threaten the health and safety of the 
public.
    In addition to these formal enforcement actions, the NIGC 
also worked with tribes to resolve a number of disputes that 
threatened the financial integrity of the gaming operations. 
These included disputes between the tribe and its management 
contractor as well as disputes between rival factions within a 
tribe.
    To date, the NIGC has imposed $2,950,000 in civil fines and 
assessments. These fines are deposited in the general fund of 
the U.S. Treasury, or in special circumstances, are payments 
from management contractors to the tribes.
    The NIGC expects a further acceleration of its enforcement 
program during the next six months. The NIGC will continue to 
give enforcement priority to cases involving individuals and 
companies managing tribal gaming operations without an approved 
management contract and will continue to investigate and take 
action against gaming operations offering class III gaming 
without approved tribal-state compacts.

                 reorganization and management controls

    During the last year the NIGC has undergone a number of 
changes. In 1996, the staff structure was reorganized to better 
address enforcement actions. Early in fiscal year 1997, a 
budget and management review process was implemented that 
resulted in changes to internal processes and procedures, and 
the Office of General Counsel also streamlined legal review 
processes. As a result of these actions, the NIGC reduced the 
time required to complete background investigations to less 
than six months, reduced the time for the final legal review of 
contracts to less than a month, reduced the backlog of 
contracts under review, and increased the number of finger 
print cards processed to sixteen hundred a month.
    Within the last few months, the NIGC has implemented 
personnel, internal management and travel procedures in keeping 
with applicable federal law and regulations. A complete 
analysis of the fee assessment program has begun in order to 
develop a plan of action regarding the overpayment of class II 
fees. The NIGC has worked with the Office of Fiscal Services at 
DOI to ensure the proper accounting of assets and liabilities 
and to develop a procedure to begin billing for background 
investigations. In addition, the amount of deposit required for 
management background investigations has been analyzed, an 
analysis of the billing rate for finger print cards has begun, 
and a more substantive review of the audits submitted by the 
tribes has been implemented.
    With each of these actions, it has become increasingly 
apparent that the NIGC needs additional funds to fulfill its 
mandate to enforce the IGRA. It is my hope that you will 
support our fiscal year 1998 budget request of $1,000,000 and 
our legislative efforts to lift or eliminate the statutory cap 
on fees and to include class III gaming revenue in the fee 
assessment structure. I believe that, with the increased funds 
our legislative initiatives will raise, the next Chair of the 
NIGC will be able to expand the enforcement of the Indian 
Gaming Regulatory Act to better accomplish the Agency's 
regulatory mission.
    Thank you for the opportunity to testify on behalf of the 
NIGC.
                                ------                                


                Biographical Sketch of Hon. Ada E. Deer

    Ada E. Deer is a member of the Menominee Indian Tribe of 
Wisconsin. Ms. Deer was nominated by President Clinton on May 
11, 1993, to be Assistant Secretary of Indian Affairs and 
confirmed by the United States Senate on July 16, 1993. On 
January 31, 1997, she was selected by President Clinton to be 
the Acting Chair of the National Indian Gaming Commission.
    She is the first woman to hold the position of Chair of the 
National Indian Gaming Commission. Her appointment, which was 
done under the Vacancy Act, will be for 120 days from the date 
of the appointment. Ms. Deer has indicated she does not wish to 
be nominee for the position of Chair of the NIGC.

                            funding proposal

    Senator Gorton. Has the administration submitted a bill to 
accomplish those goals that you so eloquently outlined?
    Ms. Deer. Yes; there is a legislative initiative.
    Senator Gorton. Really?
    Ms. Deer. That is part of the budget discussions.
    Senator Gorton. I am not aware of a bill in the Indian 
Affairs Committee on the subject. But in any event, we are 
going to have something? You are getting an answer from one of 
your staff.
    Ms. Deer. I guess there has been discussion, but it has not 
been formally submitted.
    Senator Gorton. Well, I would urge you to submit it 
formally and promptly, because I think you are probably going 
to get a favorable response to it, either through the regular 
authorization process, or it is even possible that it might 
happen in the appropriation process.
    Ms. Deer. Yes.
    Senator Gorton. Let me ask you this. If the cap were lifted 
and we permitted collections from class III gaming, would that, 
for 1998, obviate the necessity for any general fund 
appropriation at all?
    Ms. Deer. I think we would have to study this. But it would 
certainly be a wonderful change.
    Senator Gorton. Well, it would certainly help if we were 
able to use that million dollars for some other purpose by 
letting the Commission be essentially self-supporting, whether 
subject to appropriation or not. Presumably these fees could 
bring in a sufficient amount of money adequately to fund the 
Commission, could they not?
    Ms. Deer. Yes; that is true.
    Senator Gorton. Well, in any event, we would like to see a 
precise proposal as soon as you possibly can come up with it. I 
understand that the total amount of money that this Commission 
spends is considerably less than that of many individual State 
gambling regulatory commissions. Is that not the case?
    Ms. Deer. Yes; our current budget is about $4.4 million. I 
know that one State spends approximately $50 million--that is 
New Jersey--to regulate.
    Senator Gorton. I understand Nevada is about $21 million. 
My own State, which does not have open gambling, is $10 
million. So certainly the Commission is relatively modest in 
its size as against the responsibilities it has.
    What percentage of all the gambling in the United States, 
legal gambling in the United States, is conducted by Indians?
    Ms. Deer. I think it is approximately 10 percent.

                      compliance with regulations

    Senator Gorton. You have indicated optimism with respect to 
compliance, but it does seem to me rather shocking that we are 
only roughly at the 60-percent level of Interior-approved 
State-tribal gambling compacts. Does that not indicate that 
there is a great deal of gambling activity being conducted by 
Indians that is not approved, not subject to compacts or not 
otherwise approved?
    Mr. Fedman. There certainly are a large number of gaming 
operations doing class III gaming activities without compacts. 
But it is a very complex situation that varies from State to 
State and it turns on questions of State law. Most of the 
numbers, the large numbers, are in States where there is reason 
to have optimism that compacts will be concluded in the very 
near future, and there are some encouraging developments in 
California, which has the largest number of gaming operations 
without compacts. New Mexico has come very close to resolving 
the compact issue.
    So, the percentage of class III gaming activities operating 
without a compact should be reduced significantly in the course 
of the next year if things continue as they are now.

                          gaming in california

    Senator Gorton. Well, let me ask you. Why do you not give 
me some details about California? It obviously is very 
important. What is the present status in California? Does the 
Commission support the Department of Justice action to require 
State compacts by the first of next month or to shut down much 
of what is going on now?
    Mr. Fedman. The situation in California is so fluid, it 
depends on who you talk to from day to day as to what has 
happened. But from what I am hearing, there are encouraging 
developments about the compact negotiations. The States and the 
tribes appear to have resolved every issue except the precise 
gaming technology that would be authorized to be played, which 
I know is the key question.
    But I also hear that there is some encouragement there, 
that they are coming closer together. Nobody is getting exactly 
what they want, but there appears to be a good chance of 
reaching an agreement on the scope of gaming issue. So, if that 
issue can be resolved, they will enter into a model compact 
with the Pala Tribe and that compact will then presumably be 
adopted by the other tribes in California.
    There is some division, I understand, developing within 
those tribes. Not everyone is crazy about what looks like it is 
going to be in the Pala compact.
    Senator Gorton. What is the reason that, after all this 
time, you are so optimistic? Does it relate to the change in 
relative bargaining ability between States and tribes out of 
last year's Seminole Tribe of Florida v. Florida decision or 
the recent decision, I think it is a ninth circuit decision in 
Oregon?
    Mr. Fedman. Well, it does--what happened does involve legal 
decisions, but it was not either one of the two that you 
mentioned. In my opinion, the problem in California has always 
been confusion about what the State law permitted in terms of 
the gaming. And there was a State supreme court case, which is 
commonly referred to as the Western Telecom case, which for the 
first time set down parameters that both the tribes and the 
State could agree defined the permissible scope of gambling in 
California.
    The decision was so significant that when it came out our 
Commission adopted a policy that it no longer believed that the 
state of the law in California was unclarified. Therefore, any 
gaming operation opened after the Western Telecom decision had 
been issued that did not approximate the standard of gaming 
defined in that case would be targeted for enforcement.
    Once this Western Telecom decision came out, there appeared 
for the first time a meeting of the minds as to what was legal 
in California, and that really triggered the compact 
negotiations.
    Senator Gorton. So you are optimistic about settling this 
longstanding dispute in California in the relatively near 
future?
    Mr. Fedman. I would be the first to say that what I hear is 
that the talks go up and down, but they look very promising 
right now.

                           seminole decision

    Senator Gorton. Well, let me go back to the Seminole 
decision. Now that we have had it for more than 1 year, what 
have its impacts been? Is it affecting the number of compacts 
or the terms of compacts? Certainly it gave States more 
authority. Does that mean that the States by and large have 
been more restrictive, saying ``no'' more frequently?
    Mr. Fedman. I think that is fair to say, that the effect of 
the Seminole decision has been that States that do not want to 
negotiate have simply said ``no.'' We are hearing a lot of 
complaints and concerns from tribes that say that this is just 
simply not fair. After the Seminole decision, if a State wants 
to call off the talks, they are in a position to do that.
    So far, that has not resulted in any new unauthorized 
gaming. I think the frustration level is high, and there is a 
great hope on the part of the tribes that the Interior 
Department will develop its own procedures.
    Senator Gorton. Well, that was my next question. The 
Department did make such a proposal last year. It caused a 
great deal of furor and opposition, and it certainly has 
delayed implementation. What is the current status? Is the 
Department seriously considering regulations that would try to 
avoid the impact of the Seminole case?
    Mr. Fedman. I am really not in a position to answer that, 
Senator. That is completely within Interior and we are not 
really part of that.
    Senator Gorton. We have to ask the Secretary that question, 
that is what you are telling me?
    Mr. Fedman. I think so. I would rather you ask him than me.
    Senator Gorton. OK. Can you answer the question or can Ms. 
Deer answer the question of whether there are any efforts being 
undertaken by the administration to negotiate amendments to the 
basic statute itself that are acceptable to the Governors of 
the States? I can remember years of hearings on the subject in 
the Indian Affairs Committee, but no action. Obviously, the 
Seminole decision has caused proposed changes within the 
Department of the Interior itself. But has it caused any 
negotiations to take place between the administration and the 
Governors as far as any of you know?
    Ms. Deer. Not as far as I know. The Department is still 
receiving or analyzing the comments that have been requested.
    Senator Gorton. But that is for new regulations, not for 
negotiations with the States.
    Ms. Deer. That is right.

                          gaming in washington

    Senator Gorton. Well, as is usually the case, for each of 
you I have a parochial question. Obviously, I learn more about 
what is going on in Washington than I do in most of the States, 
and you have created quite a furor on and off the Colville 
Reservation in north central Washington with an attempt to 
close down taverns that I believe are located within the city 
of Omak, on fee land, but inside the exterior borders of the 
reservation, that are operating totally and completely in 
compliance with State law, as they have for many years. At the 
same time the Commission has ignored the obviously illegal slot 
machines that are being managed by the Colville Tribe without 
any compact or shred of legal authority whatsoever.
    I would sure like your comments on that. That seems to be a 
rather perverse set of priorities.
    Mr. Fedman. We were taken aback somewhat by the furor that 
arose when we issued those letters, because this is certainly 
not the first time or the first State in which we have taken 
action. From our perspective, what we saw on the Colville 
Reservation were five establishments that were doing class III 
gaming without a license from the tribe or a tribal-State 
compact.
    Senator Gorton. It is not class III.
    Mr. Fedman. If you sell pull tabs, you have to, at the same 
location, you also play bingo. The sale of pull tabs without 
the play of bingo is a class III activity. It is a rather 
technical definition but it is, under our regulations, a class 
III activity.
    I can understand the confusion, but nevertheless that is 
how we have treated it all over the country. We saw 
unauthorized gaming without a license from the tribe and 
without a tribal-State compact. Wherever we have seen these 
situations, all over the country, we have done these kinds of 
actions--in Oklahoma, New York, and California. We have treated 
them all the same way. We simply advise the parties that if it 
is on Indian lands then you are required to have a license from 
the tribe and in most cases a tribal-State compact.
    There is quite a bit of legal authority that supports our 
position. The U.S. attorney in Montana several years ago took a 
very similar action on the Flathead Reservation. There were 
video machines being operated by the State of Montana on that 
reservation, and in that case the State agreed with the U.S. 
attorney's analysis, as did the supreme court in Montana, and 
they simply ceased the licensing of those machines.
    In Idaho three tribes sued the State over the same issue, 
and there a Federal district court ruled that if it was on 
Indian lands it was required to have a license from the tribe, 
and a compact. This case involved primarily fee lands, which is 
the same situation as in Washington. The Idaho case was 
confirmed by the ninth circuit and that remains the state of 
the law in the ninth circuit today.
    So, we felt we were on fairly solid legal grounds in taking 
the action on the Colville Reservation. Nevertheless, as soon 
as we issued the letters we were called by the Washington State 
Gambling Commission. Frank Miller called me. I have the highest 
regard for the Washington State Gambling Commission. I think 
they are one of the best State regulatory agencies in the 
country. And I have a personal regard for Frank Miller.
    He said: You have made a terrible mistake, you do not 
understand the law in Washington; we are protesting the action; 
we would like you to stop.
    What we have done, based on the State's objection, is to 
defer any further enforcement on the Colville Reservation until 
such time as the attorney general of the State of Washington 
can file a brief with the Commission pointing out their legal 
arguments. And if we, after looking at what they file, conclude 
that we have made a mistake, then we will certainly not go 
forward.
    That is where the action stands today. We have notified all 
five establishments that the action has been deferred, that 
they can continue to sell pull tabs until we resolve this 
issue. We think that that is a reasonable way to go forward. 
Maybe we have missed something and maybe something applies in 
Washington that we have not seen in another part of the 
country.
    To answer the second part of your question, about why the 
class III gaming goes on at the Colville Reservation, it is 
also a rather complex legal situation. I will try to give you 
the short version rather than the long version. Essentially 
what happened there is that after the Colville and the State's 
lawsuit, in which the Federal district judge ruled that the 
compacting provisions of IGRA were unconstitutional, neither 
side appealed.
    It created a great deal of uncertainty as to the 
applicability of IGRA in that part of the State of Washington. 
The Colville Tribe did not put in class III machines, but the 
Spokane Tribe did. The U.S. attorney went after those machines, 
and he got a preliminary injunction in the district court. The 
Spokane Tribe appealed to the ninth circuit, and the ninth 
circuit issued a stay of the preliminary injunction. Thus, the 
issues about the applicability of IGRA, the illegality of the 
gaming, the scope of Federal authority, is now on appeal to the 
ninth circuit.
    Any action against the Colville Tribe would in all 
likelihood be stayed in the same manner as the issues that were 
stayed in the Spokane case, because essentially the same issues 
would be involved.
    We confer with the U.S. attorney all the time about this 
issue because it is a very frustrating situation. I talked to 
him yesterday, the assistant handling the case, and in his mind 
and in mine it would be a waste of resources to go after 
Colville.
    Senator Gorton. What is the status in the ninth circuit?
    Mr. Fedman. Well, the strangest thing happened. For 2 years 
it was put on the settlement track and it stayed there. Nothing 
happened. It has recently been taken off that track and is now 
being actively reviewed by the court. The briefing schedule is 
moving forward. The U.S. attorney is filing their brief next 
week.
    So the end is in sight, and when that matter is resolved 
then I think you will find that both the U.S. attorney and our 
Commission will be very active in that part of the State.
    Senator Gorton. Well, let me just say, even as a lawyer and 
a former attorney general, that it would be hard to present to 
an ordinary citizen a more bizarre or a more unjust set of 
circumstances than, for whatever reason, a Federal agency 
ignoring open casino class III gambling on a reservation being 
conducted without a compact and at the same time trying to 
close down pull tabs operated in a non-Indian business on the 
land that they own and inside a city, while inside the exterior 
borders of a reservation.
    If you try to sell that as an appropriate regulatory 
activity, you are going to have a very difficult time, because 
fundamentally, whatever the law is, it is not appropriate. So I 
will appreciate, I would greatly appreciate it, if you will 
keep us apprised of all of the progress on both sides, on both 
sides of that equation.
    Mr. Fedman. We certainly will.

                         funding possibilities

    Senator Gorton. I am encouraged, Ms. Deer, about your 
report on progress in the administration to give us really the 
ability to allow the Commission to operate more effectively, 
without asking for more appropriated money out of the general 
fund, and I think you are going to find us most cooperative 
when you come up with precise recommendations to carry out that 
set of ideas.
    Ms. Deer. Well, we certainly appreciate your receptivity.
    Let me say, it has been unusual for you, conducting this 
with a couple of people, Senators, coming in. It has been 
unusual for me to have two hats, too.
    Senator Gorton. Well, you have two hats, both temporary.
    Ms. Deer. That is right.
    Senator Gorton. I admire you for being able to carry on 
under such an ambiguous and indefinite status.
    Ms. Deer. Well, thank you.
    Senator Gorton. Starting a couple of years ago, I began to 
prepare visuals like this of our appropriations bills and 
others. We will leave this up here for you or any of the 
audience. This illustrates in the best way that I possibly can, 
for my own purposes and the purposes of my subcommittee, the 
kind of relative costs of our programs and the value judgments 
that we have to make when we get into a zero sum game, because 
once we have got our allocation it is a zero sum game, and more 
money for one of these important purposes can only come out of 
the pockets of others.
    It is an interesting chart and you are all welcome to come 
up here and look at it. We have a few notebook-sized copies of 
it that we will be happy to distribute.
    Ms. Deer. Thank you very much.

                     Additional committee questions

    Senator Gorton. I think that about exhausts me. We do have 
a few other questions, but I think it is appropriate to submit 
them to you in writing.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing.]

                Questions Submitted by Senator Campbell

    Question. In your March compliance report to the Secretary 
of the Interior you indicate that the FBI has informed the 
Commission that there is a backlog of over two million 
fingerprint cards to process and that as a result, these 
criminal checks are taking an average two to four months to 
process.
    Is this process a result of a lack of capacity from the FBI 
or a lack of capacity from the Indian Gaming Commission?
    Answer. Based on discussions with representatives from the 
Liaison Unit of the Federal Bureau of Investigation (FBI), the 
fingerprint card backlog is now approaching nearly three 
million. This number includes criminal and civil fingerprint 
cards. The backlog is largely attributed to the relocation of 
fingerprint processing from Washington, DC. to their new 
facility in Clarksburg, West Virginia. The average turnaround 
time to receive the completed FBI checks is two to four months.
    Processing fingerprint cards to and from the FBI is one of 
the NIGC's top priorities. It is NIGC policy to process 
fingerprint submissions from tribal governments within two 
weeks of receipt, barring any unforeseen circumstances. 
Likewise, the NIGC processes FBI record check results on a 
weekly basis so that the results are returned to tribal 
governments as quickly as possible. With an increase in 
resources and personnel, the NIGC could improve its internal 
fingerprint processing time.
    FBI representatives have advised the NIGC that they are 
implementing a 24 hours a day, seven days a week work schedule 
in an effort to reduce the backlog. As a result, the NIGC has 
seen some improvement in the response time. A recent check of 
NIGC records indicates that current turnaround time for 
fingerprint processing averages six to eight weeks.
    Question. Do you suggest any alternative way that would 
enable this process to be expedited?
    Answer. The analysis of fingerprint records and the 
completion of background investigations are key components in 
the safeguarding of Indian gaming. Careful scrutiny of these 
documents is essential and time consuming. Although the FBI is 
experimenting with the electronic submission of fingerprint 
cards, it is our understanding that the electronic submission 
for non-criminal justice purposes is at least several years 
away.
    Question. I noticed in your compliance report that several 
tribes were currently not in compliance with regard to ``Class 
II Fees paid to the Gaming Commission.
    Understanding, of course, that the compliance report 
reflects only a snapshot in time, I am interested to know what 
are some of the factors that result in tribes not coming into 
compliance with Fee payment.
    Answer. The major factor is timeliness of the payments. 
NIGC regulations state, ``The quarterly statements shall be 
transmitted to the NIGC to arrive no later than the due date'' 
(25 C.F.R. Sec.  514.1(c)(4)) and ``Each Class II gaming 
operation shall determine the amount of fees to be paid and 
remit them with the statement'' (25 C.F.R. Sec.  514.1(c)(5)). 
Quarterly statements and payments are due March 31, June 30, 
September 30 and December 31. If the NIGC is not in receipt of 
the quarterly statement and the payment by the due date, the 
tribe is shown as being in noncompliance in the fee payment's 
category. Historically many fee payments do not reach the NIGC 
by the due date.
    In addition, tribes often fail to submit quarterly 
statements of assessable gross revenues along with the fee 
payments. Total compliance requires the timely submission of 
both quarterly statements and quarterly payments. Tribes are 
required to submit quarterly statements even if no fee payment 
is due. For example, the fee assessment is based on the 
previous calendar year's assessable gross revenue figures. When 
a tribe first begins a gaming operation, they should be 
submitting to the NIGC on a quarterly basis a statement that 
shows zero assessable gross revenues for the previous calendar 
year.
    Last, a few tribes submit nothing. These include tribes who 
have failed to pay fees from the beginning, and tribes who were 
paying fees and then stopped for various reasons.
    Question. You indicated in your testimony that during the 
last two years, the Commission assessed class II tribal gaming 
at a rate of one-half on one percent of gross revenue when 
statutorily the Commission could assess rates up to 5 percent.
    Is the existing cap of $1.5 million the primary reason for 
setting assessment rates at their current level?
    Answer. Yes. Even at the current 0.5 percent fee rate, the 
NIGC still collects amounts in excess of the $1.5 million cap 
included in the IGRA.
    Question. Has the Commission projected what revenue would 
be generated at higher rates up to the statutory maximum of 5 
percent?
    Answer. Yes, the NIGC has calculated the amount of fees 
that could be generated at fee rates up to the statutory 
maximum of 5 percent on class II gaming revenues. These fees 
would be based, in keeping with NIGC regulations, on a 
percentage of assessable gross revenues from tribal gaming 
operations.
    The class II fee base for the 1997 calendar year, based on 
quarterly statements of assessable gross revenues provided by 
the tribal gaming operations to the NIGC through March 31, 
1997, is $595,829,291.77. The NIGC is aware that this figure 
includes revenues from non class II gaming that is not subject 
to fee assessment. Thus, it is inappropriate to utilize this 
figure as the base number for final NIGC revenue projections. 
The final base number could be as low as $300,000,000 or 
slightly higher than the amount reported through March 31, 
1997.
    Given these two extremes, an average of $450,000,000 could 
be a reasonable figure for calculating an NIGC revenue 
projection. Using this average as the base figure would yield 
potential revenue from a low of $2.25 million at .5 percent to 
a high of $22.5 million at 5 percent. This is in comparison to 
the $20.7 million fiscal year 1997 Budget of the Nevada Gaming 
Control Board and the $52 million appropriated by the State of 
New Jersey to fund its regulation of gaming.
    Question. You indicated in your testimony that you 
currently have a staff of 33 people. How many of these 
individuals are operating in the field?
    Answer. To cover the 28 states with Indian gaming, the NIGC 
currently has seven staff members operating in the field. Each 
works out of an office maintained in their home.
    Question. How many are located here in your Washington 
Office?
    Answer. Excluding the Acting Chair (part-time) and the two 
Associate Commissioners, there are 25 people located in the 
Washington office.
    Question. How many individuals do you have on your staff 
that are devoted primarily to enforcement efforts and following 
through with collections of fines and assessments?
    Answer. Of the entire NIGC staff, twelve employees are in 
the Enforcement Division. Of this total, seven are devoted 
directly to field investigation and enforcement efforts. The 
estimated fiscal year 1997 expenditure for this section of the 
Enforcement Division is slightly less than $1 million. Issues 
concerning fee assessments are dealt with by two Washington 
staff members in the Administrative Division.
                                ------                                


                 Questions Submitted by Senator Cochran

    Question. The Mississippi Band of Choctaw Indians operates 
a class III gaming operation and has, in addition to its 
arrangement with the State, its own Indian Gaming Commission. 
In each NIGC report, the Choctaws have been found to be in 
complete compliance with the Indian Gaming Regulatory Act.
    Has the Commission found a correlation between those tribes 
that have set up their own regulatory agencies and 
effectiveness in compliance?
    Answer. The NIGC believes that there is a definite link 
between the existence of tribal gaming commissions and the 
quality of the regulation within an Indian gaming operation. 
Those tribes which have strong, well funded gaming commissions 
are much more likely to have established a strong compliance 
record.
    Question. What are the budgets of the successful tribal 
gaming commissions?
    Answer. The budgets of tribal gaming commissions vary 
dramatically depending on the size of the gaming operation. 
Information received from some tribal gaming commissions 
indicates that funding levels can range from $20,000 to 
hundreds of thousands of dollars. While the level of funding is 
a significant issue, other factors such as the regulatory 
experience of the commission members and the independence of 
their authority, appear to be more important predictors of a 
successful gaming commission.
    Question. What actions has the Commission taken to support 
tribal regulatory agencies in meeting the requirement of their 
compacts?
    Answer. The NIGC has taken a number of actions supporting 
tribal gaming commissions including publishing of a bulletin 
advising tribes how to establish and operate such a commission, 
holding workshops and conferences on the subject of tribal 
gaming commissions, and speaking at conferences of 
organizations consisting of tribal gaming regulators. The NIGC 
does not have the authority to enforce the requirements of 
tribal/state compacts.
    Question. How many Class III tribal gaming operations are 
in compliance today?
    Answer. According to preliminary figures for the quarter 
ending March 31, 1997, there are 99 operations in compliance 
with each of the items on the compliance report. This is a more 
than 30 percent increase in the total compliance rate as of 
December 31, 1996.

                          subcommittee recess

    Senator Gorton. With that, the hearing is recessed.
    Thank you all very much. The subcommittee will stand in 
recess until 9 a.m., Thursday, April 17, when we will receive 
testimony from the Forest Service.
    [Whereupon, at 11:20 a.m., Thursday, April 10, the 
subcommittee was recessed, to reconvene at 9 a.m., Thursday, 
April 17.]



  DEPARTMENT OF THE INTERIOR AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

                              ----------                              


                        THURSDAY, APRIL 17, 1997

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 9 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Slade Gorton (chairman) presiding.
    Present: Senators Gorton, Stevens, Cochran, Domenici, 
Burns, Leahy, Bumpers, Reid, and Dorgan.
    Also present: Senator Craig.

                       DEPARTMENT OF AGRICULTURE

                             Forest Service

STATEMENT OF HON. JIM LYONS, UNDER SECRETARY, NATURAL 
            RESOURCE AND ENVIRONMENT
ACCOMPANIED BY:
        MIKE DOMBECK, CHIEF, FOREST SERVICE
        DAVID G. UNGER, ASSOCIATE CHIEF, FOREST SERVICE
        JANICE McDOUGLE, ACTING, DEPUTY CHIEF, NATIONAL FOREST SYSTEM
        BARBARA WEBER, ACTING DEPUTY CHIEF, RESEARCH
        JOAN COMANOR, DEPUTY CHIEF, STATE AND PRIVATE FORESTRY
        CLYDE THOMPSON, ACTING DEPUTY CHIEF, ADMINISTRATION
        RON STEWART, ACTING DEPUTY CHIEF, PROGRAMS AND LEGISLATION
        STEVEN SATTERFIELD, DIRECTOR, PROGRAM DEVELOPMENT AND BUDGET 
            STAFF

                             Budget request

    Senator Gorton. The subcommittee will come to order.
    We are meeting today to hear from the Forest Service, 
obviously one of the vitally important agencies funded by the 
Subcommittee on Interior and Related Agencies.
    We are pleased to have Jim Lyons, Under Secretary, and Mike 
Dombeck, Chief of the Forest Service.
    You are both welcome, as are those who accompany you.
    As my colleagues are aware, this subcommittee is 
responsible for funding a diverse array of agencies. A large 
portion of our bill is comprised of the four land management 
agencies: The Park Service, the Bureau of Land Management, Fish 
and Wildlife Service, all of which are in the Department of the 
Interior, together with the Forest Service from the Department 
of Agriculture.
    I want to highlight that fact of being in the Department of 
Agriculture, because I am going to get back to it in a moment.
    It is important to note that the Forest Service represents 
the largest single agency funded by this bill, a full 19 
percent of the money we appropriated for the current fiscal 
year, and, along with the other three land management agencies, 
a full 44\1/2\ percent of the entire bill.
    While these four agencies are significant in the 
subcommittee's funding efforts, there are obviously other 
demands. I have for you, as I have had for the others agencies 
at past hearings, this large chart of the current fiscal year 
and the relative size of the appropriations for each of those 
agencies.
    That indicates, among other things, that once we receive 
our 206B allocation, everything is a zero sum game. Any extra 
money for one agency can only come out of some of the others.
    In any event, Mr. Lyons, you are over there at the base of 
the green line, the large, green bottom portion of it. And that 
is a very significant part of what we do.
    [The information follows:]

Interior programs fiscal year 1997 enacted

                                                                        
Land management programs:
    Forest Service......................................  $2,361,000,000
    National Park Service...............................   1,414,000,000
    Bureau of Land Management...........................   1,090,000,000
    Fish and Wildlife Service...........................     653,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................   5,517,000,000
                    ========================================================
                    ____________________________________________________
Indian programs:
    Indian Health Service...............................   2,054,000,000
    Bureau of Indian Affairs............................   1,606,000,000
    Navajo-Hopi/IAIA/special trustee/Indian gaming/
      Indian education..................................     119,000,000
                    --------------------------------------------------------
                    ____________________________________________________
        Total...........................................   3,779,000,000
                    ========================================================
                    ____________________________________________________
Science and minerals management programs:
    Geological Survey...................................     739,000,000
    Office of Surface Mining [OSM]......................     272,000,000
    Minerals Management Service [MMS]...................     163,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................   1,174,000,000
                    ========================================================
                    ____________________________________________________
Energy programs:
    Energy conservation R&D.............................     570,000,000
    Fossil energy R&D...................................     365,000,000
    Naval petroleum NPR/reserves........................     144,000,000
    Energy information administration/economic 
      regulation........................................      69,000,000
    Alternative fuels production........................      -4,000,000
    Clean coal technology...............................    -123,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................   1,020,000,000
                    ========================================================
                    ____________________________________________________
Cultural programs:
    Smithsonian Institution.............................     370,000,000
    National Endowment for the Humanities...............     110,000,000
    National Endowment for the Arts.....................      99,000,000
    National Gallery of Art.............................      60,000,000
    Holocaust Memorial..................................      31,000,000
    Institute of Museum Services........................      22,000,000
    Memorials...........................................      41,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     733,000,000
                    ========================================================
                    ____________________________________________________
Interior departmental offices:
    Interior affairs....................................      88,000,000
    Departmental management.............................      58,000,000
    Solicitor...........................................      35,000,000
    Inspector general...................................      25,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     207,000,000
                    ========================================================
                    ____________________________________________________
      Total bill........................................  12,430,000,000

                            native americans

    Senator Gorton. Another large part of the bill is comprised 
of programs for the benefit of Native Americans, primarily the 
Bureau of Indian Affairs and the Indian Health Service.
    The Indian Health Service is an especially demanding 
responsibility for this subcommittee, as the cost simply of 
maintaining existing levels of medical services increases at an 
annual rate that exceeds inflation and has certainly exceeded 
any additional appropriations that we have received.
    The third major group of agencies in our bill is that 
including the cultural agencies, the Smithsonian, the National 
Gallery of Art, the Kennedy Center, and the National Endowments 
for the Arts and Humanities.
    While these agencies account for a smaller portion of the 
total funds appropriated in the Interior bill, they are in many 
cases the agencies responsible for the care and protection of 
our Nation's heritage. These programs receive vocal support 
from all across the country and from many Senators on both 
sides of the aisle.
    The fourth group of agencies in our bill include the 
Science and Mineral Management Programs, and a fifth major 
grouping consists of programs within the Department of Energy.
    I have broken the bill out this way and provided this 
chart, Mr. Lyons and Mr. Dombeck, so you can see the nature of 
the problems that we have and, therefore, the nature of the 
problems that you have. It is tough competition.
    That competition will become even more fierce if the 
President and Congress are unable to enact a budget that 
includes meaningful entitlement reforms or other measures that 
enable us to achieve balance without relying almost exclusively 
on reductions in discretionary spending.
    If no such agreement is reached between the President and 
Congress, I fear that this subcommittee will be forced to cut 
sharply, many programs and terminate others.
    With regard to the immediate issue of fiscal year 1998, I 
note that the President's request for programs under the 
jurisdiction of this committee is a good $700 million above the 
1997 level.
    Given that a freeze or reduction in total discretionary 
spending is a real possibility, it is clear that some 
reductions from the request level will almost certainly have to 
be made.
    I really look to the two of you and to your assistants for 
help in prioritizing programs when it comes time to make tough 
choices.
    Having said all that, I do want to note that the Forest 
Service fiscal year 1998 increase of 0.3 percent over the 1997 
enacted amount is the smallest requested increase in the four 
land management agencies.
    Enjoy that positive comment about the Forest Service budget 
request, because you may not hear many more such positive 
statements this morning.
    I say that because I am truly concerned about the Forest 
Service. I told you I would get back to the issue of the Forest 
Service being in the Department of Agriculture. I think it is 
fair to say that the Forest Service is undergoing a significant 
transition.
    Last year my colleague, Senator Stevens, questioned why we 
have a Forest Service. Many people scoffed at the thought. This 
year the same issue has been brought up again.
    Over in the House just last month one of the Congressmen 
likened the current Forest Service situation to the Civil War 
and President Lincoln saying to the military, ``If you arent 
going to use the army, I might like to borrow it.''
    It is clear that many people are asking what the Forest 
Service is doing with itself. The agency was placed in the 
Department of Agriculture under the guidance of its founding 
father, Gifford Pinchot.
    Make no mistake about it, Mr. Pinchot's perspective was 
wise use of the resources for the good of the population of the 
United States over the long term.
    Many people now, both in the country and in the Congress, 
feel that the administration has abandoned this concept of wise 
use. There appears to be a new perspective strongly in favor of 
preservation programs over everything else.
    I must say to both of you that many actions on the part of 
this administration seem to support that premise. It clearly 
seems to be a time to examine the mission of the Forest Service 
as represented and reflected in its budget proposal, and that 
is what we would like to do here today.
    As I told you last night, Mr. Lyons, long after we 
scheduled this meeting the majority leader asked me to be in 
his office at 9:30 a.m. Senator Burns has kindly agreed to 
preside over the committee hearing for a half an hour or so. We 
hope that we can continue through with all of the really 
important questions that we have.
    In the absence at this point of Senator Byrd for an opening 
statement, I will ask whether or not my colleague from Montana 
would like to say anything.

                    opening remarks of senator burns

    Senator Burns. Well, thank you, Mr. Chairman. I will just 
put my statement in the record.
    I think I have the same concerns that you do and especially 
in--nobody has to know that you own a big chunk of my State.
    And we are getting to the point where the same concerns 
that there is a louder, small voice here that happens to set 
policy on lands than the people who actually are near those 
lands, whose economic survival depends on those lands, and 
also, that our ability to take care of them is hampered by 
people of little bitty minds just about the size of the eraser 
on this pencil.
    So I can--it amazes me. It just absolutely amazes me about 
this 13 square miles of logic-free environment on where we come 
up with some of these crazy, damn things that we have to--we 
hear coming down the chute.
    So I will put my statement in the record, a strong letter 
to follow, and get a shot at the questions.
    Thank you very much, Mr. Chairman.

                  summary statement of hon. jim lyons

    Senator Gorton. With that, Mr. Lyons, we will be happy to 
hear from you and Mr. Dombeck.
    Mr. Lyons. Well, thank you very much, Mr. Chairman. I 
appreciate this opportunity to appear before you, Senator 
Burns, and the subcommittee today.
    In light of your tight schedule, I will limit my comments 
and ask that Chief Dombeck have a little more of my time to 
offer his perspectives in his new role as the head of the 
Forest Service.
    We are very pleased to have Mike join the Forest Service. 
After his brief tenure over in Interior he has come back home. 
I think he is going to provide outstanding leadership and will 
help us tremendously in addressing the many challenges we face, 
both resource management challenges and organizational 
management challenges in the Forest Service.
    I also want to acknowledge the presence of Dave Unger, 
Mike's associate chief. Dave recently received the Presidential 
Rank Award, the highest award that can be provided a civil 
servant, for his many years of dedicated service to the Forest 
Service, as well as the Soil Conservation Service, now the 
National Resources Conservation Service.
    Dave recently announced, at the height of his career, that 
he is going to retire, which shows his continual wisdom, going 
out when he is at the best of his game.
    I just want to say for the record how much I have 
appreciated Dave's long service and commitment and dedication 
and want to acknowledge the role he has played in providing for 
the Nation's legacy of natural resources.
    I will let Mike introduce the other members of the Forest 
Service who are here with us today.
    Mr. Chairman, I would like to make three points that I 
think help set the stage for the situation and the challenge we 
face, the committee, the administration and the Forest Service, 
in dealing with the difficulties we have in coming up with a 
budget to support the Forest Service activities.
    The first point is that, we have a very, very broad mission 
in the Forest Service. We have the world's largest natural 
resource research organization. We play an extensive role 
through our State and private forestry programs and working 
with private landowners in protecting the Nation's forests and 
lands, not just the National Forest System lands, from insects 
and disease.
    We do extensive work in urban and suburban areas, helping 
the 80 percent of all Americans who reside in those areas 
understand their relationship to the out of doors and hopefully 
improving their environment.
    One of our primary focuses is the work we do on the 
National Forest System, 191 million acres of the best landscape 
in America and a very important part of the landscape in 
Montana and Washington and other parts of the United States.
    Our challenges are growing, and our work is changing over 
time. I find myself in a position these past 4 years and in 
this term trying to deal with an agency that is going through 
tremendous change, as the Nation's economy has gone through 
tremendous change. I think we are caught up in a change as 
well.
    The second point I want to make is that this change in 
mission and change in direction is not something that is being 
driven by administrative fiat or differences in philosophy 
between ourselves and all of you but simply reflects, I think, 
changing values in how the American public wants to use its 
landscape.
    I would offer as an example a significant increase in 
recreation demand across the United States, a significant 
increase in recreation and tourism as an important part of the 
economic engine of States like Washington and Idaho and Montana 
and other places, also a growing challenge in dealing with 
threatened and endangered species.
    We face a listing decision here with regard to coastal 
coho, which could affect Washington, Oregon, and northern 
California, as well as bulltrout, which could affect Montana in 
the inland West.
    Increasing challenges in providing for and supporting the 
economies of rural communities that are going through 
transitions from economies that were based almost solely on 
extractive industries and on timber and mining to economies 
that are now much more broadly based. They may have as their 
anchor timber and mining, but now have to consider things such 
as recreation and tourism in other parts of their economy. We 
play a critical role.
    We also remain an important source of high quality outdoor 
recreation opportunities and a primary source of high quality 
water for most of the communities in the Western United States.
    So we have a very diverse role, and public values certainly 
are affecting how our role changes over time. Jack Thomas, 
Mike's predecessor, instituted a philosophy in the organization 
called adapted management, management based on change, 
recognizing that our circumstances and our resource demands 
change.
    I would suggest as an organization we are going through 
adaptive management in trying to change our organization, as 
other businesses are doing, to respond to changing times.
    Finally, I want to address the question that you raised and 
that Chairman Stevens has raised before and that is: Why do we 
have a Forest Service?
    I would suggest that now more than ever we need a Forest 
Service because of the changing circumstances that we see and 
because we are uniquely positioned, the professional expertise 
we have with the scientific understanding we have of good 
resource stewardship to ensure a continuous supply of the goods 
and services that the public demands from its national forests, 
that the public requires of private forest lands, and that we 
will need to provide in terms of the research and understanding 
that is going to help guide these resources on into the future.
    As I said, the national forests are increasingly required 
to provide a great deal more than just timber and minerals and 
opportunities for grazing and the like. The demands continue to 
grow.
    And in many respects, the Forest Service's mission is 
spinning around to the mission that was originally established 
for the National Forest System when it was first established, 
which, as Senator Stevens reminds me often, was a continuous 
supply of timber, but also continuous water flows.
    In fact, many of the national forests in the West were 
first established to protect water supplies for cities like Los 
Angeles, San Francisco, Portland, and Seattle.
    We recognize this changing mission and changing direction 
by trying to respond as much as we possibly can. Our overall 
mission as an organization is caring for the land and serving 
people. And I think that mission is sound.
    But what is different is what people are demanding from 
their national forests and their expectations of the kinds of 
service and support we are going to be providing.
    In fact, in many respects, Mr. Chairman, I think the 
organization is going through a transition from producing 
things to providing services as we enter the service economy as 
well. That does not mean that we will not continue to provide 
timber as an important product of national forest management.
    But more and more we are using the timber sale program to 
achieve other goals and objectives, such as improving forest 
health, improving wildlife habitat, and protecting other 
natural resources.
    We are more and more investing in other kinds of resource 
management to try and respond to increasing demand for 
recreation and tourism, to respond to community needs to 
diversify the products, goods, and services that we provide.
    We are doing our best to respond to these changes with 
declining budgets and also a declining work force. It creates a 
tremendous challenge.
    We are committed to working with you to try and deal with 
challenges, to provide guidance, and set priorities. We are 
trying to be creative and use the tools that you have provided 
us to be more responsive.
    Those tools run the gamut from recreation fee demo project, 
which may afford us a way to provide more support for the 
recreation program, to innovative uses for land management, 
such as the Forest Legacy Program, one of the projects which of 
course you and I will go visit here in 2 weeks, where we 
purchase long-term easements instead of fee simple purchases, 
so we can spread our dollars further.
    It is a tough challenge these days, Mr. Chairman, but I 
think as an organization the Forest Service, better than any 
other land management agency, is well positioned to deal with 
those challenges and prepare itself for the resource management 
challenges that we are going to face in the 21st century.

                           prepared statement

    I am proud of the organization. We have gone through some 
difficult times. I think the real question is not why do we 
have a Forest Service, but what is it that we need to manage 
for, and how can we best position ourselves and obtain the 
resources we need to ensure that we can meet the public's 
demand for the goods and services that come from the Nation's 
natural resources in perpetuity?
    Thank you.
    [The statement follows:]
               Prepared Statement of Hon. James R. Lyons
    Mr. Chairman, Senator Byrd, and Members of the Committee: Thank you 
for inviting me and the new Chief of the Forest Service, Mike Dombeck, 
to appear before you and discuss the fiscal year 1998 budget for the 
USDA Forest Service. We are joined by several other Forest Service 
professionals who have worked long hours and weekends to assemble the 
budget for the President.
    As you and your staffs review the specifics in our budget proposals 
for 1998, I hope you can keep in mind three key themes and principles 
which provide the foundation for all the goals, objectives and programs 
in this budget. (1) The broad scope and mandate of the Forest System 
Mission; (2) The imperative of restoring and protecting healthy 
ecosystems; and (3) Our efforts to help spread conservation and forest 
stewardship beyond the National Forest System borders.
                       the forest service mission
    The Forest Service mission is ``caring for the land and serving 
people.'' I want to focus first on ``caring for the land.'' Many people 
cannot comprehend exactly how much land we care for. The National 
Forest System's nearly 192 million acres is the equivalent land area of 
Michigan, Ohio, Kentucky, West Virginia, Virginia and the whole 
northeast--a total of 16 states plus the District of Columbia. We 
manage 156 forests with the average size of the State of Delaware.
    Consider this: each Forest Supervisor wakes up each morning to 
manage an area the size of a small state. Their jobs are not easy.
    In caring for the land, we need to address all of our assets--clean 
streams, abundant fisheries, birdlife, game, endangered species, trees, 
clean air, windblown mountain tops, lakes, grasslands, arid canyons, 
the temperate rainforests, open meadows, woodland swamps. The list goes 
on. We have enormous responsibilities to make sure this land is 
healthy. Most of our proposed budget will be spent on trying to protect 
this national treasure chest of natural resources coast-to-coast.
    The second part of our mission is ``serving people.'' Again, it may 
sometimes be difficult to comprehend exactly how many people depend on 
the forests for services.
    Tens of thousands of the private landowners--who own and manage the 
rest of the 600 million acres of private forest land--look to our State 
and Private Forestry Programs for technical advice and financial 
incentives.
    National forests provide the more outdoor recreation opportunities 
than any other federal land agency. Millions of Americans visit the 
National Forest System to hunt, camp, hike, fish, sight-see, climb, 
ski, canoe, birdwatch and other activities. The Forest Service goal is 
to provide high quality outdoor recreation opportunities to meet users' 
demands while still being good stewards of the land.
    Since 1973, more than one million Americans have spent a day, a 
week or even more working with Forest Service employees as campground 
hosts, trail builders, researchers and dozens of other activities.
    In addition, many other Americans go to work on National Forest 
Lands to operate timber sales, grazing permits, mining claims, guiding 
companies and carry-out other commercial uses.
    When you consider all of these customers coupled with the people 
who depend on Forest Service research, international expertise, urban 
and community forestry and the rest of our activities, you begin to 
realize the scope and breadth of ``caring for the land and serving 
people.'' This is the philosophy behind the $3 billion dollar budget.
                  restoring and protecting ecosystems
    The best and most credible science today demonstrates that Aldo 
Leopold was right decades ago--everything is connected to everything 
else. We are applying his sage advice to ``not throw away the parts'' 
when we tinker with our natural ecological systems. I am proud to say 
that the USDA Forest Service has demonstrated to the world the cutting 
edge in ecosystem management. In the Pacific Northwest, we have 
standards and guidelines in place which are not directed at one 
outcome, one product or one use. We have a system in place that, 
according to the best available science, ensures that we are on track 
to manage those ecosystems for perpetual sustainability. We will 
continue to learn more, but today that region is on track and the 
services we provide and the health of the land will be dependable.
    In the Pacific Northwest we are working to restore aquatic 
eocsystems. Degraded anadromous fish habitat and their watersheds will 
be restored and enhanced by reducing sedimentation and streambank 
erosion, introducing structures to create pools that provide hiding 
cover or accumulate spawning gravel, and remove or modify man-made 
barriers to improve adult and juvenile migration conditions.
    In Oregon, the Forest Service and the Governor are committed to 
working together to achieve restoration of eastern Oregon forests. 
Efforts to accelerate and emphasize restoration will be a partnership, 
with community-based support, and will be done within the framework and 
guidelines of the Eastside Environmental Impact Statement and other 
direction, such as PACFISH.
    In the Sierra Nevada range we are in the process of applying the 
best science available in a similar effort. I believe we basically have 
all of the information we need to make wise resource choices, and in 
the next few months, a team of scientists familiar with the issues, 
region and National Forest System process will help us confirm a 
direction that ensures long-term dependability for goods and services 
and ecological integrity.
    In the next few months we will take significant steps forward in 
the Columbia River Basin. Again, we have the best minds working to 
provide a unified consensus approach to sustaining this ecosystem for 
the people who live in the area and depend on the resources for their 
quality of life, as well as for the area's wildlife.
    We have completed a scientific assessment for the Southern 
Appalachian region and are working to improve our understanding of the 
Great Lakes region. Our budget provides the tools and funding necessary 
that continues to propel the Forest Service to the forefront of forest 
management. Throughout our ecosystem efforts you will probably begin to 
see the evidence of Chief Dombeck's ``collaborative stewardship'' 
concept, and I will leave this point for his remarks. For now, I can 
say I am very optimistic about the potential.
               forestry beyond the national forest system
    USDA is the premier forest landowner assistance organization in the 
world. The Department conducts extensive scientific research, has a 
workforce with technical expertise in counties across the country, and 
provides financial incentives to help landowners increase the 
conservation contributions that private land makes to our nation's 
fish, wildlife and clean water resources. Our 1998 budget includes 
funding to support this well-established, broadly supported leadership 
role in the Department of Agriculture.
    We have included in the 1998 budget a strong continuation of our 
stewardship assistance program that includes a 5.7 million dollar 
increase for Stewardship Incentives. I want to emphasize that the 
increases in certain state and private forestry programs are not offset 
by national forest system cuts; the state and private budget is 
essentially flat. However, we strongly believe that willing landowners 
deserve the technical and financial support of the Forest Service if 
they want to go the extra mile to deliver food and fiber to the 
marketplace while practicing good stewardship on their lands.
    In addition to $16 million within the National Forest System for 
``Jobs In the Woods'', $17 million is included the budget to provide 
critical assistance to rural communities in the Pacific Northwest. The 
other programs in the State and Private Forestry--including Urban and 
Community Forestry, Forest Legacy and Cooperative Fire Management--are 
all critical to our efforts to enhance non-federal forest resource and 
protect productive timber land from fire and conversion to non-forest 
uses.
    We also intend to step up our nationwide monitoring capacities so 
that we can be better tuned to the forest trends across the landscape. 
The program will cover 60 percent of the forest land in the lower 48 
states, compared with 53 percent in 1997 and 40 percent in 1996. 
Coupled with our level budget in research, we will have the basis to 
make good decisions.
    The Forest Legacy program is designed to conserve the resource 
values of forest land, emphasizing lands of regional and national 
significance that are threatened with conversion to non-forest uses. 
Conservation easements, or fee simple purchase are methods used by the 
Forest Service and our partners in working with willing landowners. An 
example of a successful partnership is the Mountains to Sound Greenway 
for the protection and preservation of a ``green corridor'' along I-90 
from Seattle through the Cascade Mountains. About 950 acres have been 
added to this long-term effort through acquisitions and partnerships. 
The largest conservation easement east of the Mississippi resulted from 
Forest Service negotiations and a state grant option allowing Vermont 
to step in and complete this acquisition. This easement covers 31,450 
acres in the ``Northeast Kingdom'' of Vermont, protecting a large 
contiguous block of forest land from development. This joint approach 
also fits in with our objectives of coordinating state and federal 
efforts to achieve mutual objectives.
    The Urban Resources Partnership program was initiated on Earth Day 
in 1994. Eight cities, including Los Angeles, Seattle, Denver, Chicago, 
New York, Philadelphia, Atlanta, and East St. Louis, currently 
participate in the Program. This program is providing urban residents 
the opportunity to address local environmental issues and improve the 
quality of urban life. Additional events are planned for Earth Day 
celebrations this month. This is a continuing program throughout the 
year that has achieved successes that include conducting environmental 
education, habitat restoration to revitalize wetlands in the Los 
Angeles Basin, established community gardens for food and educational 
purposes, supported Arbor Day activities, and is helping build 
community capacity. Partners in Los Angeles include the USDA Natural 
Resource Conservation Service, National Park Service, Housing and Urban 
Development, Environmental Protection Agency, California Department of 
Forestry, the City of Los Angeles and over 50 non-profit organizations 
in the Los Angeles Basin.
    The Forest Service is a science-based organization and our research 
products are used around the globe. Each day, field foresters, land 
managers, farmers, ranchers, mill operators, urban foresters, public 
interest groups and many others apply the knowledge developed by Forest 
Service scientists and cooperators in academia and industry. The Forest 
and Rangeland Research Budget is to be funded at $179.8 million, the 
same funding level as fiscal year 1997. However, the programs are 
continually being adjusted to meet changing and emerging national and 
regional issues and maintain a broad-based scientific capability.
                               conclusion
    Let me close by saying that the challenges and activities I have 
highlighted represent shifts in business as usual as well as our goals 
for the future management of the national forest system. Within the 
framework of a balanced budget by the year 2002, this budget meets the 
highest priorities of a very expansive mission and ever increasing 
public demands.
    I am confident that the budget before you meets our central 
challenge: Caring for the Land and Serving People. The job is large, 
the demands are great and the stakes for the future are high.
    That concludes my testimony, Mr. Chairman. I would be happy to 
answer any questions at the conclusion of Chief Dombeck's statement.

                   summary statement of mike dombeck

    Mr. Dombeck. Good morning, Mr. Chairman, Senator Burns.
    I am pleased to appear before you for the first time in 
this job as Chief of the Forest Service. I have been just a 
little over 3 months in the job, and of course as I think both 
of you know, I am no stranger to the agency.
    I grew up in a national forest in Wisconsin's beautiful 
lake country in the Chequamegon National Forest. So I come with 
that perspective as well.
    I have to say, as you implied in your remarks, that we are 
faced with competing demands, tough challenges, new pressures, 
and a greater diversity of people living on the land today than 
every before. I would hope that we in this room can help move 
the ball forward.
    I believe that if we work together, we can usher in a 
spirit of trust, a spirit of moving forward, and a deep 
commitment to the healthy forest, healthy lands, and the 
service to the people.
    I come here with a willingness to hear all sides of the 
debate, a commitment to remain open and responsive to new 
ideas, new values, new information, and a commitment to leave 
our national forests healthier than when I first came into this 
job.
    I want to say that I am proud to be back in the Forest 
Service. I continue to remind myself it is an agency with some 
of the best resource professionals in the world, the best wild 
land firefighters, the best recreation planners, some of the 
best silviculturists, the best biologists, and an 
administrative support staff. We have a work force that in 
essence is second to none in capability.
    I want to also add that I am not so naive to think that 
people will not sometimes disagree. I think our task as public 
servants, as resource professionals, is to focus on areas of 
agreement and move forward where we can.
    My commitment, what I call collaborative stewardship, is 
listening to people and having our people, the resource 
managers, work hand in hand with local communities, with the 
constituencies, both local and national, to move forward.
    I will also keep my remarks short, because I know you have 
to leave soon. I want to call your attention to the many 
successes that I have included in my testimony. I think it is 
important that we continually remind ourselves that in spite of 
so many challenges that we have, there are also many, many 
successes.
    In every State there are places where things are working 
very well, and we need to take a look at those as models of how 
we can improve relationships in other places.
    I do want to mention accountability. Our first priority is 
to the land and people, but our responsibility in this agency 
is to deliver goods and services and values for which public 
lands are cherished, to deliver healthy lands and waters, to 
deliver a sustainable supply of timber and forests, to deliver 
environmentally benign energy and minerals development, to 
deliver better hunting, better fishing, high quality recreation 
experiences and the many other things that this agency needs to 
be held accountable for.
    And I will again for the sake of brevity, stop here. But I 
do want to introduce the leadership of the Forest Service that 
is here to help me. Given the fact that I am just a little over 
3 months in the job, there are a lot of things that I have not 
yet learned.

                       introduction of associates

    Of course, Dave Unger, Associate Chief, and I would like to 
second Mr. Lyons's comments about Dave and thank him for 
agreeing to stay with me through this transition and help me 
get going.
    Janice McDougle is Acting Deputy Chief for National Forest 
Systems. Barbara Weber behind me here is Acting Deputy Chief 
for Research. Joan Comanor, Deputy Chief for State and Private 
Forestry, Clyde Thompson, Acting Deputy Chief for 
Administration, Ron Stewart, Acting Deputy Chief for Programs 
and Legislation.
    And the guy that really knows what is going on, that has 
all the numbers, is Steve Satterfield. And I know all of you 
know Steve well.

                           prepared statement

    I would like to ask that my statement be entered into the 
record.
    Senator Gorton. It is and so will Mr. Lyons's be.
    [The statement follows:]
                   Prepared Statement of Mike Dombeck
    Mr. Chairman, Senator Byrd and Members of the Committee: I am 
pleased to appear before this committee for the first time as Chief of 
the Forest Service. As some of you may know, I am no stranger to the 
Forest Service, having grown up 25 miles from a town of 1,500 people in 
northern Wisconsin's beautiful lake country, in the Chequamegon 
National Forest.
    Today, faced with more competing demands, new pressures on the land 
and greater challenges than ever before, resource management has become 
contentious. We in this room can help to change that. I believe that if 
we work together, we can usher in a new era of resource stewardship and 
a deeper commitment to conservation. A commitment marked by a 
willingness to hear all sides of the debate. A commitment to remain 
open and responsive to new ideas, new values, and new information. A 
commitment to leave our lands healthier and our waters cleaner.
    I am not so naive to think that people will not sometimes disagree. 
Our task as public servants and resource professionals is to focus on, 
and build from, the many more areas of agreement. To regain the trust 
of the American people. To demonstrate to the rest of the world that 
yes, people of good will can come together and find a way to live 
sustainably on the land.
    I call this commitment to working with people to maintain and 
restore the health of the land, collaborative stewardship. 
Collaborative stewardship rests on one very basic premise: we simply 
cannot meet the needs of people, if we do not first secure the health 
of the land.
    To get a better sense for how people feel the Forest Service should 
pursue collaborative partnerships, I have recently talked with many in 
the Administration, members of Congress and their staff, former Forest 
Service Chiefs, employees, retirees, and conservation and industry 
leaders. In all of my conversations, three themes are repeated: people, 
knowledge and land. It strikes me that that's what the Forest Service 
is all about--using knowledge to conserve and restore the health of the 
land for the benefit of the nation's people.
    I'd like to share with you some examples of how the Forest Service 
is meeting the needs of people through better land management decisions 
and more effective use of knowledge. For instance:
  --In Washington, the Pacific Northwest Region of the Forest Service 
        is aggressively pursuing the reduction of fuels from the 
        national forests. Not only does this improve resource 
        protection against catastrophic wildfires, but it improves 
        ecosystem health as well. In addition, implementing the 
        Northwest Economic Adjustment Initiative through close 
        cooperation with state and local governments is helping many of 
        this region's timber-dependent communities move towards more 
        diverse and sustainable economies.
  --In partnership with the Alaska Department of Community and Regional 
        Affairs, rural development grants of $319,000 to 21 communities 
        were awarded focusing on enhancing the overall quality of life 
        in rural areas primarily through natural resource based 
        solutions. In addition, economic recovery program funds 
        targeted grants to nine communities dealing with the acute 
        problems associated with federal or private sector land 
        management decisions and policies to complete projects 
        identified in their community action plans. In addition, 
        Research has prioritized its efforts in the Northwest to 
        address two major issues of concern in Alaska: (1) how to 
        produce wood consistent with sustaining ecosystems and 
        producing multiple values; and (2) how to address the spruce 
        beetle infestation on over one million acres.
  --The National Forests in Mississippi during 1995 experienced one the 
        worst southern pine beetle outbreaks on record. A cooperative 
        effort led to an incident command system to battle this 
        outbreak as if they were fighting a major forest fire. This 
        innovative approach worked well and helped minimize the impact 
        of the beetle outbreak. It has been effectively used during the 
        resulting salvage sales program in 1996.
  --In New Mexico, the Cibola National Forest began charging parking 
        fees along the Sandia Crest Scenic Byway as part of the 
        recreation fee demonstration program authorized by Congress in 
        August 1996. Monies collected are being used to provide safe 
        and clean picnic grounds and trailheads along the Scenic Byway. 
        Since implementation, vandalism has dropped dramatically. 
        Cooperators in this venture include the New Mexico State 
        Highway Department, East Mountain Chamber of Commerce, the 
        Turquoise Trail Association, and Tinkertown Museum. In 
        addition, efforts on the Gila National Forest to develop 
        improved relationships with Catron County have resulted in a 
        Memorandum of Understanding to clarify roles and improve 
        communications. The Lincoln National Forest and the Cloudcroft 
        Municipal School Board, Otero County have worked out a land 
        exchange using public lands to meet the growing needs for 
        classroom and faculty expansion.
  --In Montana, the development of the Lincoln County Log Yard with 
        Forest Service Economic Action Program support to unload, sort, 
        scale and forward short logs will expand the raw material 
        supplies, enhance business opportunities for small business 
        owners and create incentives for implementing forest health 
        management practices.
  --In Utah, the multiple uses of public lands can be clearly seen. 
        Preparations continue for the 2002 Olympics. The Natural 
        Resource Coordinating Committee will steer the State's 
        government agencies in a coordinated support role for the Salt 
        Lake Organizing Committee. This partnership will allow the 
        world to see the value of public lands and environmental 
        stewardship with nearly all the venues on National Forest 
        System lands. Many partners, contributing nearly three times 
        what the Forest Service is contributing are working to improve 
        stream and wildlife habitat and do fish and wildlife population 
        surveys. Coal production in the State is contributing nearly 
        $35 million in bonus bids and royalties to the federal 
        government during a three-year period.
  --In New Hampshire, the acquisition of Bretton Woods at the base of 
        Mt. Washington on the White Mountains National Forest will 
        secure this land for public use of its outstanding vistas, 
        provide protection of 2 miles of Ammonoosuc River frontage, and 
        provide access to Upper Falls.
  --In Colorado, the Boulder Community Volunteers have won the Chief's 
        National Volunteer's Award four times. These volunteers are a 
        shining example of how local people can come together to join 
        in with the Forest Service to achieve the goals of caring for 
        the land and serving people. Elsewhere in Colorado, we are 
        working with Dow Chemical and the counties to develop 
        alternative methods of controlling noxious weeds.
  --In West Virginia, the gypsy moth pest management efforts and 
        watershed projects in Morgantown and the timber and watershed 
        efforts in Parsons are successfully integrating research, with 
        the cooperative programs in forest health, to the management of 
        the national forests for use not only in West Virginia, but 
        across much of the Appalachians.
  --In Vermont, the acquisition of 2,800 acres of the Chittenden 
        Reservoir property was completed. This tract of land will serve 
        as a valuable addition to the public's lands and the National 
        Forest System.
  --In Arkansas, the epidemic of southern pine beetle infestation and 
        storm damage on the Ouachita National Forest led to a 
        successful timber salvage and fuel treatment program 
        contributing to the goals of protecting ecosystems.
  --In South Carolina, the Sewee Visitor and Environmental Education 
        Center was opened in 1996. This project is a visitor and 
        environmental education center for the interpretation of the 
        Cape Romaine National Wildlife Refuge and the Francis Marion 
        NF. This is a cooperative project between the U.S. Fish and 
        Wildlife Service, Cape Romaine National Wildlife Refuge, and 
        the U.S. Forest Service.
  --Elsewhere in South Carolina, the Savannah River Forest Station 
        sponsors two innovative and unique education programs serving 
        under-represented, minorities through collaboration with local, 
        state, and federal partners. The education programs focus on 
        improving science, math and engineering education through 
        hands-on activities for students in grades 3-12 and also serves 
        science and engineering college undergraduates and faculty.
  --In Nevada, partnerships are accomplishing improvements to fish and 
        wildlife habitat and conducting population surveys and 
        monitoring of plant and animal populations. At Walker Lake, 
        partnerships are doing important research and monitoring, 
        including inventories, and studies of riparian and range 
        processes and functions.
  --In North Dakota, an average of 6,800 acres each year are added to 
        the non-industrial private forest land base which is managed 
        under the guidance of professionally developed Forest 
        Stewardship Management Plans. These plans are designed to 
        accomplish the specific objectives of individual private 
        landowners such as windbreak planting and renovation, forest 
        products utilization, and wildlife habitat improvements.
  --After wildfires in southern California were successfully 
        suppressed, a Burned Area Emergency Rehabilitation team 
        initiated watershed rehabilitation measures. These measures, 
        involving many federal, state, and local agencies and the 
        California Native Plant Society, were put in place prior to the 
        first damaging storm of the season reducing the potential for 
        additional loss and damages. Rehabilitation efforts included 
        the protection of threatened and endangered species habitat, 
        hydroelectric power, heritage resource sites, and flood control 
        and water supplies. The rest of my testimony outlines the key 
        funding priorities for fiscal year 1998 and re-emphasizes many 
        of the points the Under Secretary has already made.
                             accountability
    Our first priority is to the land and the people who use and care 
for it. Our responsibility is to deliver the goods, services, and 
values for which public lands are cherished. To deliver healthy lands 
and waters. To deliver a sustainable supply of timber and forage. To 
deliver environmentally benign energy and minerals development. To 
deliver better hunting and fishing. To deliver quality recreation 
experiences, and to do all of the above through an efficient, and 
accountable organization.
    Every forest supervisor, on every forest, must be held accountable 
for conserving and restoring the health of the land. Clearly, we must 
deliver sustainable supplies of wood fiber for American homes; forage 
for livestock; and minerals and energy that help support healthy 
economies. But as I said earlier, the health of the land must be our 
first priority. Failing this nothing else we do really matters.
                the fiscal year 1998 president's budget
    This year's budget proposal reflects the Forest Service's 
priorities and programs within the agency's mission ``Caring for the 
land and serving people''. It focuses on implementing the Forest 
Service's strategic long term goals:
  --Restore and Protect Ecosystems.
  --Provide Multiple Benefits within the capabilities of ecosystems.
  --Ensure Organizational Effectiveness.
    Within this framework, in fiscal year 1998 we will make a major 
effort to improve financial and ecological accountability. Three 
significant initiatives--the road building program, fire fighting 
funding and the salvage fund--illustrate this.
    Many people question the logic in trading roads for National Forest 
trees, especially given the current expansive network of roads on the 
National Forest System and the cost of maintaining many of these roads 
once they are built. The time has come to address our transportation 
needs in a different way. Our Budget proposes to discontinue the use of 
Purchaser Credit which will make the road a direct cost of the timber 
sale. Bid prices for timber sales are expected to decline 
commensurably. Forest Service engineers will continue to work with 
private contractors to ensure Forest Service roads meet our standards.
    Funding mechanisms for our fire programs need to change. 
Discretionary spending levels cannot accommodate the escalating costs 
of fire suppression, which have increasingly been met through emergency 
spending outside the budget caps. We have proposed two main changes: 
First, we want to ensure that funds to fight fire are available to our 
fire fighters when wildfires begin. The fiscal year 1998 President's 
Budget proposes a government-wide contingency fund to cover various 
disasters including emergency firefighting. Second, we want to better 
ensure that we capitalize on opportunities to use management techniques 
that reduce catastrophic wildfires. Under our proposal, between $30 and 
$50 million is recommended for hazardous fuels reduction--a 25- to 100-
percent increase over 1997. The cost of reducing much of the fuels 
buildup before a wildfire occurs, pales when measured against the costs 
of putting out intense, fuel-driven wildfires. These are two 
significant improvements that address our financial and ecosystem 
needs, and I hope you will support us in this effort, as you have in 
the past.
    We are proposing a change in the current salvage sale fund so that 
funding we receive more closely reflects the type of work that we are 
doing in the field. Active management is necessary to restore ecosystem 
health.
    Our budget proposal retains the existing Salvage Sale fund account 
and its primary function--funding the removal of dead or dying timber 
on National Forest System lands. A separate, distinct account is 
proposed to fund ecosystem health and restoration projects. This fund 
would be called the ``Forest Ecosystem Restoration and Maintenance'' 
fund--or FERM. This is an important first step to provide funding for 
necessary watershed restoration work that is not directly tied to the 
timber receipts of each separate forest. I hope you can agree with our 
motivations and objectives. We must accelerate the restoration of our 
publicly owned lands and waters. This new fund draws from several 
existing sources and would begin fiscal year 1998 with 121 million 
dollars for restoration efforts. We must use all of the tools we have 
available to accelerate the restoration of our nation's forests--
thinning, increased use of prescribed burns, mechanical treatments, and 
so on. These restoration efforts are investments--investments that 
will, for example, diminish the risk of catastrophic fire along the 
urban wildland interface. The cost of not making these investments 
grows exponentially every year.
    There are also two more emphasis items within the President's 
fiscal year 1998 Budget:
    The President's Forest Plan for the Pacific Northwest:
    Continuing to implement provisions of the President's Plan is a 
priority in fiscal year 1998. The budget includes $107.4 million to 
carry out critical work for watershed protection, monitoring, timber 
harvest, adaptive management and development of rural communities' 
long-term economic strength.
                            hazardous waste
    Funding for the fiscal year 1998 Forest Service hazardous waste 
work is provided within the USDA central fund for this purpose. For 
fiscal year 1998 $14.25 million is identified for the Forest Service. 
Efforts will be targeted on cleaning up hazardous waste sites 
identified on national forest lands, especially identifying responsible 
parties under CERCLA so that they, not the taxpayers, pay the cost of 
cleanups.
                  additional appropriations highlights
    This year's budget reflects continuation of our research program at 
last year's level. Science is critical to our program as a nation. As I 
said before, we are about knowledge and our research program produces 
much of the knowledge necessary to address contemporary issues. We will 
continue to adjust our efforts to meet changing and emerging national 
and regional issues and maintain a broad based scientific capability.
    Our overall State and Private Forestry program is also at last 
year's level. However we are proposing to place a greater emphasis on 
our Stewardship Incentive Program (+$5.7 million). In addition, State 
and Private Forestry, the National Forest System, and Forest and 
Rangeland Research would jointly expand the scope of forest health 
monitoring to cover 60 percent of the forest land in the lower 48 
States. This program is built on a strong partnership among the Forest 
Service, the National Association of State Foresters, and the Bureau of 
Land Management. The program includes all forest ownerships; Federal, 
State, and private.
    Under the National Forest System appropriation, we are requesting 
an increase of $50 million. This increase is targeted for Recreation 
Use, Wildlife and Fish Management, Rangeland Management, Forestland 
Management and our Soil, Water and Air Program.
    Our efforts in the Reconstruction and Construction area will be 
targeted at extensive reconstruction needs with emphasis on health and 
safety items such as contaminated water systems.
                               conclusion
    Finally, I believe the Forest Service mission--caring for the land 
and serving people--is more important than ever. Within the overall 
plan to balance the nation's budget by the year 2002, these proposals 
will help us to meet our highest priorities and ever increasing public 
demands.
    That concludes my testimony, Mr. Chairman. I would be happy to 
answer any questions you or members of the Subcommittee may have.

                          organization changes

    Senator Gorton. I would like to begin by discussing the 
direction the Forest Service seems to be oriented toward in the 
near future.
    It is apparent, Mr. Dombeck, based on recent changes at the 
top of your organization, that you have plans for new 
direction. While official documentation might reflect 
otherwise, it seems pretty clear that you have removed three of 
your principal deputy chiefs. You filled two of these 
positions.
    Now that Mr. Unger is leaving, and in concert with another 
vacant deputy chief, you will still have three vacancies at the 
top of the organization to fill.
    Many comments, including those of former Associate Chief 
George Leonard, point to the fact that you are purging the 
organization of resource professionals who have performed their 
jobs based on sound stewardship principles, but otherwise would 
not do the administration's bidding.
    In addition, you brought with you into the chief's position 
several assistants with little if any Forest Service 
experience. Would you tell me why you let three deputy chiefs 
go?
    Mr. Dombeck. Well, first of all, let me say that they 
selected to do what they did, as it was their choice. I did not 
ask them to leave. I offered them options and did not suggest 
retirement.
    Part of the function and intent of the Senior Executive 
Service is to provide flexibility in leadership jobs. I believe 
that as a new chief, I should have the option to select my 
team.
    I want to assure you the people that have been selected, 
for example, the incoming Deputy Chief for Research, Robert 
Lewis, is a long-time employee of the Forest Service, a senior 
executive with impeccable credentials, highly regarded by, I 
believe, the people that have criticized me for the actions.
    Likewise, Bob Joslin, who is coming in as Deputy Chief for 
National Forest System, is a long-time Forest Service employee, 
highly respected across the board by the timber industry, as 
well as the conservation community. I have received many, many 
compliments from both employees and retirees for those 
selections.
    I want to assure you that other selections will be made in 
that vein of resource professionals. I hardly think that 3 
changes out of 35,000 is a purge. From the standpoint of the 
employees that I brought with me, again, three people.
    One is a secretary at a GS-11 level. Another one is a 
policy analyst at a GS-12 level. And another one is currently a 
special assistant, GS-15 level.
    I would be happy to elaborate on any other questions that 
you have concerning all this.

                          organization changes

    Senator Gorton. I gather by implication from that answer 
that we can look for significant additional personnel changes.
    Mr. Dombeck. Obviously, as Dave Unger, who elected to 
retire effective July 3, the demographics of the agency are 
such that, like a lot of agencies, many, many of the senior 
executives are of retirement age and of course have the option 
to do as they wish.
    And from the standpoint of my intent, I do not believe you 
will see massive changes as maybe some of the folks may have 
been concerned with.
    Senator Gorton. You have spoken about the experience at 
least of some of your new people. Can you tell me whether or 
not these new people will be committed to the multiple use 
concepts that have been the historic basis of the Forest 
Service organization?
    Mr. Dombeck. Yes; very much so. In fact, I would like to--
since I have discussed it with some of the staff--and the 
concern, as I understand it, may be with Francis Pandolfi.
    Let me say that the role Francis will play has to do with 
the finance and the numbers business of the agency. He has an 
MBA from Harvard, is an executive that has run a couple of 
major corporations.
    As you know, the area of finance is one of the areas where 
we have some challenges. This is the reason for bringing in 
this high level of expertise. He has not been brought to the 
agency to make natural resource policy decisions but to deal 
with the business side of the organization.
    Senator Gorton. Thank you for those answers. And once 
again, I apologize for being requested elsewhere at 9:30. 
Senator Burns has agreed to take over in my absence. I am sure 
I will be back before we are finished. But thank you for this 
beginning.
    And, Senator Burns, for the time being, it is all yours and 
Senator Stevens.
    Senator Burns [presiding]. Before I get into my 
questioning--and thank you, Mr. Chairman. And I look forward to 
seeing you in 30 minutes.
    And I will--Senator Stevens has joined us this morning, and 
we look forward to his--if he has a statement that he would 
like put in the record, or would you like to start off with 
some questions? We will just start with you, because I know you 
are a busy man.
    Senator Stevens. No; I am going to stay until 10:30. You go 
ahead.
    Senator Burns. You are going to stay until 10:30? That is 
pretty dangerous right there. You guys are in big trouble. 
[Laughter.]
    And he is in a good mood, so that sort of gets hard, too. 
[Laughter.]

                               recreation

    Let us talk a little bit, Mike, about--I hear the statement 
of the Assistant Secretary, and we have changing times. You 
know, I will have to be right honest with you, I do not hear 
that.
    Maybe you hear it here, but you get out on the ground, if 
you get outside and get on the ground and people who really 
count, I think we are still in the resource management 
business.
    And recreation kind of comes second, because I do not see 
any increase in numbers of people crawling around in the 
forests out there.
    No. 1, I see a lot of rich people buying accesses to 
forests, so they cannot get through one ranch to get to another 
backing up to those things. And I am concerned about that.
    But let us put recreation as it should be with resource 
management. Tell me about the dollars that are derived from the 
resources that are found, the timber, mining, grazing, as 
compared to what your recreation dollars are.
    Mr. Dombeck. Let me--first of all, I think the statement I 
made that you may be referring to is that the way I intend to 
look at the National Forest System is that one resource is not 
dominant over another. As Jim mentioned, the importance of 
maintaining water flows, timber programs, mining, forage, 
grazing, recreation and those sort of things.
    Some of the data associated with recreation use that I have 
here--and I can look at Montana, for example, where we had 8.8 
million recreation visitor days in 1986, and in 1996 it was 13 
million, 13.4 million.
    So the increases in demand, in some States has doubled. 
Alaska, for example, it went from 3.5 million in 1986 to 6.9 
million in 1996. We are not suggesting that the other resources 
are less important.
    Many of the--if you look at, for example, the national 
forests of California and the tremendous, tremendous pressures 
people from the Los Angeles basin place on the Cleveland 
National Forest, and the San Bernandino National Forest.
    The workloads there are just absolutely tremendous. The 
trash that we have to pick up, the inflow of immigrants coming 
through there, the hazard of fire and the tremendous workload 
associated with it.
    It is important that we manage this recreation to prevent 
resource degradation, whether it is cultural resources, water, 
or streams, all those kinds of things. So those are some of the 
numbers associated with the increased demand.
    From the standpoint of overall programs, the receipts from 
timber were about $500 million, from recreation about $48 
million.
    However, the contributions of recreation and tourism to 
local economies, of course, are significant. A lot of 
communities in Montana that I have been to, as well as the area 
where I grew up, have people wanting to spend time in open 
space. The number of people that move to areas because of the 
open spaces and the opportunities to hunt and fish and do all 
the things that people like to do in the country is very, very 
important.
    We can provide you with any breakdown of numbers, and we 
will do that for the record that you wish.
    From the standpoint of allocations to programs, what we are 
requesting for in the timber program in 1998 is about $210 
million.
    And what is it for recreation?
    That is receipts. Excuse me. Do you have the request?

                           forest management

    Mr. Lyons. If I could, Mr. Chairman, let me just make one 
point, because I want to make sure that my comments were not 
misunderstood. I do not mean to imply, and certainly I am not 
asserting, that we have to manage for one resource or one use 
over another. And as you know, using multiple use is a 
philosophy that underpins everything we do.
    We can manage for recreation and produce timber. We can 
manage for water quality and continue to have high quality 
forest production and grazing. We have to manage for it all.
    I think more and more what we see is that management is 
critical to ensuring we have good range lands, good water 
quality, and good wildlife habitat. As the forests, 
particularly in the intermountain west, are at risk of damage 
from insect and disease, forest health and ecosystem health 
need to be improved.
    I do not want to imply that these things are mutually 
exclusive. In fact, I think more and more we demonstrate that 
we need to recognize these things in concert and manage them in 
totality, and not one resource against the other.
    Mr. Dombeck. The request for 1998 for recreation is $216 
million, and for timber it is $269 million. And I have any 
other combinations of breakdowns that you would like.

                         fire and forest health

    Senator Burns. Mr. Babbitt has suggested he wants to burn 
some forest land for forest health, around 3.5 million acres. 
How does that figure in with your plans over in the Forest 
Service?
    Mr. Dombeck. Well, in the National Forest System we have 39 
million acres, we estimate, in high-risk or catastrophic stand.
    I think what we are proposing is the flexibility to do 
between 800,000 and 1.3 million acres. We would like to be able 
to do about 3 million acres per year to sort of get ahead of--
start catching up with this.
    But I also want to point out that some of the reasons for 
the condition of the forests, in a sense part of it is that we 
have of course put out every fire for a lot of years.
    Some of it is also the fact we have not practiced the 
silviculture we need to practice and that we know how to do. 
Part of the problem is the social environment is such that it 
makes it very, very difficult. The forest health issue is not 
necessarily a technical issue.
    I was on the Deschutes National Forest about 1 month ago, 
and the Deschutes has received real high marks for its success 
in implementing timber programs and other things.
    What the people of that part of the State are telling the 
forest employees there, as they tell it to me, is what they 
want is the forest to look like forests. You know, they do not 
want to see a mountainside of bug-killed trees.
    They do not want to see a mountainside that is black from a 
catastrophic fire. And they do not want to see a mountainside 
that is clearcut.
    We have not been doing large clearcuts for a long time. 
Within that window there are tremendous opportunities to deal 
with some of the problems. For example, I might show you some 
pictures of a situation that is very common throughout the 
West. This happens to be in northern California. I think you 
have these photos in your packet.

                            thinning program

    This is--here is about 1,500 trees per acre. You can see 
the--the other thing I might point out is we have fir that has 
grown up in what were traditionally pine stands. And, of 
course, the economic value of the fir is much lower.
    So what do we do in a situation like that to get in and fix 
it? Well, the first thing they did was a thinning. And in the 
thinning program, they removed approximately 2 million to 3 
million board feet per acre, along with about 35 to 40 tons per 
acre of nonmerchantable material, and left about 100 trees per 
acre in that stand.
    Now 8 years later, that same stand would look like that. 
And now it is ready to do a prescribed fire, because the fuel 
ladders have been reduced enough. The fuel ladders that would 
carry the fires all the way up to the tree tops and kill the 
entire trees are gone.
    What I am advocating is that we have to use all the tools 
at our disposal and continue to look for more tools as we deal 
with this forest health challenge. Those tools include 
everything from timber sales, to perhaps grazing, to thinnings, 
to sometimes mowing, to whatever works.
    The choice of tools is not for Washington to dictate. That 
is for our resource professionals in the field to determine, 
what are the best mechanisms to deal with this issue, because 
the issue of fire is going to keep on coming up.
    One point I would like to make, I think is very important, 
is a lot of these areas do not have the timber values on the 
land to pay for the cost of the work that is needed. So what do 
we do?
    In essence, just like a farmer might or a rancher, 
sometimes you have to make investments in land. And from the 
standpoint of the timber harvest rotation period, the harvest 
cycle may be 80 years, a generation or two ahead of us.
    But it is important that we go ahead and do the thinnings, 
provide the appropriate recreation facilities, and use all the 
tools to get on top of this forest health issue, because it is 
a significant problem.
    I know it is expensive, but it is interesting that we can 
come up with $900 million a year to fight wild land fire, but--
so how can we begin to shift some of that cost into preventive 
measures that, you know, provide local jobs and other things, 
rather than just simply responding year after year to this 
massive fire situation that is continually getting worse and 
worse?
    Senator Burns. Senator Stevens.
    Senator Stevens. I think Senator Cochran has to go before I 
do.
    Senator Cochran. No; and I just got here.
    Senator Stevens. Are you all right?
    Senator Burns. Or I can go to Senator Reid.
    Senator Stevens. No; that is fine. I am happy. I just 
thought he had a committee meeting.
    Senator Cochran. I do, but it has been moved to 10:30 a.m.

                      forest service organization

    Senator Stevens. Mr. Lyons, as you know, I have reached the 
conclusion that the Forest Service is no longer a Forest 
Service; it is a recreation and public service and should be 
combined with the Park Service and the Fish and Wildlife 
Service.
    We should eliminate the redundant management of these three 
entities because of the administration's position that they are 
primarily recreation.
    I state that coming out. As you know, that is my feeling, 
and I am going to pursue that. But beyond that, what did you 
think when Mr. Dombeck removed--by the way, Mr. Dombeck, it is 
not 3 out of 35,000; it is 3 out of 5, you removed 3 of 5 of 
the professional Deputy Chiefs.
    Now was that done with your approval or at your direction 
at all, Mr. Lyons?
    Mr. Lyons. No, sir; Mr. Stevens.
    Senator Stevens. Is there any memoranda between you and Mr. 
Dombeck over what his job would be when he took over the 
administration of the Forest Service? Did you give him a memo 
of directions?
    Mr. Lyons. No, sir.
    Senator Stevens. Did you personally interview him and give 
him directions?
    Mr. Lyons. No; I certainly talked to Mike before I 
introduced him to the secretary, but no, I do not--we did not 
discuss any agenda.
    Senator Stevens. I am just asking if, at the Assistant 
Secretary level or the Secretary level, Mr. Dombeck was 
directed to do what he did.
    Mr. Lyons. No, sir.
    Senator Stevens. Mr. Dombeck, you said you offered options 
to the directors. I remember when the Kennedy administration 
came in and they offered the option to several people to be 
moved across the country in 30 days or quit. What were the 
options that you gave to these three?
    Mr. Dombeck. I elected to--we probably have about how many 
Senior Executive Service [SES] slots in the agency?
    Senator Stevens. That is not what I asked you. What were 
the options you gave these people?
    Mr. Dombeck. I offered them the choice of coming to me with 
where they--what they would like to do. For example, in the 
case of Mark Reimers, Mark thought about it and came back and 
is now working as a volunteer in the area of international 
forestry.
    That is the area he was most interested in, and was his 
decision because he felt that with the many, many years that he 
had in, that there really----
    Senator Stevens. That is one. You had a State and private. 
Which one--you have State and private, research, National 
Forest System, administration and programs and legislation. 
What are the three you gave the options to?
    Mr. Dombeck. National Forest System, research, programs, 
and legislation.
    Senator Stevens. The three that are primarily involved with 
Forest Service practices, right? What was the option you gave 
the research? Who was it, by the way, that you asked to leave?
    Mr. Dombeck. Well, first of all, let me say no one was 
asked to leave.
    Senator Stevens. Well, you were going to remove them from 
their position, were you not?
    You gave them the options to take other jobs, but you did 
not say, ``You can keep your job, if you wish'' did you?
    Mr. Dombeck. That is correct. Part of the----
    Senator Stevens. All right. So you asked them to leave 
their jobs, the jobs that they had when you came on board.
    Mr. Dombeck. Yes; that is right.
    Senator Stevens. Now, what was the job you offered the 
research director?
    Mr. Dombeck. The research director is currently working 
on----
    Senator Stevens. I did not ask you that, Mr. Dombeck. What 
did you offer him?
    Mr. Dombeck. I offered them the--I asked them to come back 
and tell me, what would work best for them. What they would be 
interested in doing, how they feel they could contribute the 
most and what would work with their personal situations.
    And they--of course, they know the options of the agency as 
well or better than I did. In the case----
    Senator Stevens. Well, who appointed them? Who moved them 
in the Research--who moved the Research Deputy Chief into that 
position?
    Mr. Dombeck. I assume that it probably would have been 
Chief Robertson that was in that----
    Senator Stevens. And who was the National Forest System 
Deputy Chief?
    Mr. Dombeck. Gray Reynolds; that would have likely been 
Jack Ward Thomas.
    Senator Stevens. Where did--you say the people that came in 
were long-term forest employees. Any of them foresters?
    Mr. Dombeck. The Deputy Chief for National Forest Systems, 
Bob Joslin, is a--has broad experience across the agency. I 
believe his degree is in--he is classified as a forester. I 
believe his degree is in forestry. And as I----
    Senator Stevens. Where was he before you brought him into 
that position?
    Mr. Dombeck. He was a Regional Forester in Atlanta. Prior 
to that he was Assistant Director of--Deputy Regional Forester 
in the intermountain region. Was he not a Deputy Director of 
timber management?
    He has very broad support across the board from both the 
timber industry, the employees, and the conservation community.

                             tongass timber

    Senator Stevens. All right. Let me go to you, Mr. Lyons. As 
you know, my State used to have a very vibrant timber industry.
    It had two pulp mills and I think at the time the 
administration came in eight timber mills. To my knowledge, 
none of them are running now.
    We had a 1947 Tongass Timber Act, and then we had a Tongass 
Timber Reform Act of 1991. Under that Tongass Timber Reform Act 
we have made available, Congress made available--and I might 
add I do not think the administration requested the money--$30 
million to prepare a Tongass timber reform plan, or TLMP.
    Where is that plan?
    Mr. Lyons. Senator Stevens, as I believe you are aware from 
some meetings we have had with you and Chairman Murkowski----
    Senator Stevens. I am aware of it, but I want you to state 
it on the record.
    Mr. Lyons. Yes; I just want to let you know that consistent 
with the conversation we have had previously that we are 
committed to completing this draft TLMP plan and getting it out 
by June 20.
    Senator Stevens. The administration came into office in 
1993. TLMP was completed and ready for final approval. And the 
administration directed the then Regional Forester to 
disapprove it. And we can prove that.
    You actually asked him to prepare two opinions and finally 
told him to sign one. And he resigned after he did what he was 
told, a Mr. Barton.
    All right. Now, it was finished in 1993. This is 1997. When 
will it be finished now under this administration's plan?
    Mr. Lyons. Well, we will issue the draft here early this 
summer. Then we will go through a comment period and hopefully 
wrap it up soon afterward.
    Senator Stevens. And what will be the timber supply under 
that plan?
    Mr. Lyons. I do not know, sir.
    Senator Stevens. Is it not in final draft now?
    Mr. Lyons. But I do not know what the actual numbers are. 
They are in the process of completing their analysis now, and 
that is a decision for Regional Forester Janik to ultimately 
make.
    Let me correct my statement, Mr. Stevens. I want to be 
clear that--actually, this is the final rod. So when this goes 
out, we will have to deal with an appeal process, which I am 
sure we are going to hear a lot of in potential litigation. So 
I do not mean to imply this is another draft. This is the plan.
    Senator Stevens. How much have you spent on plans in other 
forests? Have you spent $30 million on any other forest?
    Mr. Lyons. I hope not. I do not know what our total 
expenditures have been for forest planning.
    Senator Stevens. Well, would you give me for the record a 
listing of the plans you have prepared and how much they have 
cost?
    Mr. Lyons. Yes, sir; we can provide that.
    [The information follows:]
                         Land Management Plans
    The Records of Decision for the Land and Resource Management Plan 
(LRMP) revisions have been published for the following five National 
Forests:
  --Black Hills (South Dakota, 3/97).
  --Rio Grande (Colorado, 12/96).
  --Targhee (Idaho, 4/97).
  --Francis Marion (South Carolina, 3/96).
  --National Forests in Texas (3/96)
    The Record of Decision for the Tongass National Forest in Alaska is 
expected within the next month.
    LRMP revisions are actively underway in more than a dozen other 
forests which have already published a related Notice of Intent in the 
Federal Register.
    The costs of LRMP revisions is only now becoming possible to 
estimate based on these initial experiences. As you have indicated, the 
cost for the Tongass revision was very high and we consider this to be 
atypical. Based on figures provided by the Regional Planning Directors 
for those other five revisions noted above, we calculate that LRMP 
revisions will each take an average of $500,000 per year for four 
years, or an average of $2 million per plan.

                             tongass timber

    Senator Stevens. The Tongass Timber Reform Act requires 
that the plan be prepared to provide timber to meet market 
demand. Do you know what the market demand is now?
    Mr. Lyons. No, I do not know precisely what it is. It is 
certainly part of the analysis that is being done as part of 
this TLMP process.
    Senator Stevens. Well, since you have closed essentially 
all the facilities, where is the demand going to come from now?
    Mr. Lyons. Well, I assume that the demand will come from 
remaining independent operators and the potential for mills to 
come back on line as there is a clear understanding of what the 
timber supply will be from the Tongass and surrounding areas.
    Senator Stevens. In the 6 years that we have been dealing 
with this plan--it is really 5, I guess, with your 
stewardship--the Forest Service has never met its own timber 
program target. Can you tell me why?
    Mr. Lyons. I think one of the issues we have had to deal 
with in the Southeast, as you know, Senator, have been 
challenges to particular sales.
    We had a challenge, in a particular large number of sales, 
the CPOW sales, which were originally offered to Ketchican. And 
that certainly has caused significant delay.
    One of the things we hope to accomplish by completing the 
land management plan is to provide a sound, scientific basis 
and legal framework for fending off challenges to future timber 
sales that are prepared under the plan.
    Senator Stevens. The Tongass is still divided into two 
separate forests for management, right?
    Mr. Lyons. The Tongass actually has three areas that are 
administered. Is that right?
    Senator Stevens. That was back in the days when we were 
dealing with three separate portions of the industry that was 
purchasing timber. Why does it still have three separate 
managements when there is really no timber produced for sale 
now?
    Mr. Lyons. I really cannot speak to the management 
structure up there, Senator, but I certainly could--if Mike 
wants to address that, perhaps he could, or we could ask Phil 
Janik to follow up.
    Senator Stevens. Well, I would like to have a statement for 
the record, what is your plans for consolidation of management 
in view of the fact that there are no timber operations going 
on any longer.
    Mr. Lyons. I would be glad to address that.
    [The information follows:]

          Consolidation of Tongass National Forest Management

    Timber operations, although at a reduced level due to 
recent mill closures, are occurring under the independent sale 
program and under the terms of the KPC settlement agreement. In 
addition, the program of work in the region in all resource 
areas is such that we need to continue the management structure 
currently in place (3 administrative units on the Tongass NF). 
The workload associated with the burgeoning tourism industry is 
proving to be large, for example.

                           performance awards

    Senator Stevens. Now, in your report--by the way, you have 
just given out a series of performance awards in the Forest 
Service. How many of them actually were foresters? Would you 
put that in the record, please?
    Mr. Lyons. Yes, sir; maybe we could just get some 
clarification on what those awards are. Chief Dombeck just 
handed out the chiefs' awards last week. And then, of course, 
we hand out spot awards from time to time for outstanding 
performance.
    So maybe we will just try and put it altogether for you and 
provide that information.
    [The information follows:]
                           Performance Awards
    Foresters and forestry technicians received a slightly smaller 
percentage of performance awards in comparison with the entire Forest 
Service workforce. In fiscal year 1996, 66 percent of total FS 
permanent employees received a performance award, while in the same 
period, 61 percent of foresters and forester technicians received a 
performance award. This includes all types of awards, including spot, 
time off, extra effort, bonus, quality step increase, and gain share.
    The following table shows the total number of awards and the number 
of awards to foresters/forestry technicians for fiscal year 1996:

                     NUMBER OF AWARDS TO FORESTERS/FORESTRY TECHNICIANS FOR FISCAL YEAR 1996                    
----------------------------------------------------------------------------------------------------------------
                                                                     Permanent                                  
                                                                    employment     Number awards      Percent   
----------------------------------------------------------------------------------------------------------------
Total permanent workforce.......................................          29,705          19,709              66
Forester/forestry technicians \1\...............................          10,234           6,233              61
----------------------------------------------------------------------------------------------------------------
\1\ Includes all permanent employees in the GS-460 and GS-462 Office of Personnel Management occupational       
  series. These are included in the total permanent employees.                                                  

    Additionally, the Chief's Honor Awards presentation was held on 
April 10, 1997, to recognize team and individual accomplishments during 
fiscal year 1996 that were of national significance to the Forest 
Service. Awards were presented in the following categories:
  --Stewardship Award: One group award.
  --Technology Transfer: Two individual awards and one group award.
  --Distinguished, Superior, and Early Career Scientists Awards: Four 
        individual awards.
  --Ecosystem Management: Two group awards.
  --Multicultural Organization Awards: One group award and one 
        individual award.
  --International Forestry: One individual award.
  --Labor-Management Partnership Award: One group award.
  --Law Enforcement and Investigations: Two individual awards.
  --Internal Communications: Nine group awards.
  --Course to the Future: One individual award.

                                 awards

    Senator Stevens. I have had a complaint that since this 
administration has come into office that people involved in 
forestry do not get awards. But those who are involved in 
environmental, recreational, water service, and other things 
do.
    If that is true, I think it just proves my point that you 
are no longer a forest service. You are managing the Federal 
lands under your control for other purposes, which if this 
administration is going to do that, we ought to recognize that. 
And we ought to adjust accordingly.
    And I again say that we ought to have a recreation and 
public service entity managing the Park Service, Fish and 
Wildlife Service and the Forest Service, and save all this 
money that we are spending for people to cruise timber and do 
all the studies of timber and then not sell it. As a 
consequence, I think we are just spending a lot of money.
    I want to go back to those pictures, Mr. Dombeck. I am 
going to get back to you in a minute here.
    If any of you have timeframes, let me know because I have 
adjusted my timeframes. I do not have any timeframe that is 
going to interfere with this, this morning.
    Senator Cochran. Well, can I interrupt and just ask a 
couple questions?
    Senator Stevens. Yes, sir.
    Senator Cochran. You were very kind, Mr. Chairman, to offer 
to permit me to go ahead and ask a few questions awhile ago. I 
appreciate that very much.
    Let me just for the record officially welcome Mike Dombeck 
and congratulate him on his selection as chief. This is the 
first hearing where I have had an opportunity to claim some 
credit for his education.
    He served in my office as a legislative fellow back in the 
mideighties, and I came to respect him and appreciate his 
intelligence and hard work and good judgment. He has turned out 
to be, of course, the top career person in the Forest Service 
now and is so recognized by his selection as chief.

                           purchaser credits

    I wonder what your reaction is to the budget provision that 
has been brought to my attention with respect to the 
elimination of the purchaser credits. I am told that the budget 
submitted by the President proposes to eliminate these credits 
and its system for road construction on national forest lands.
    I am told by those in my State who are familiar with the 
practical consequences of this that this will either eliminate 
the 25-percent funds to many county governments and school 
districts because those amounts are paid based on gross 
receipts from the sale of timber.
    And if the purchasers are required to pay for the road 
construction and do the road construction out of their own 
pocket with no credits for the expense, that is going to 
eliminate some sales and drastically reduce sales in other 
forests.
    Has there been any assessment made as to what the actual 
reduction in timber sales would be in States such as 
Mississippi as a result of this change?
    Mr. Lyons. If I could, Senator Cochran, I think I will 
address that one.
    Senator Cochran. Sure.
    Mr. Lyons. The administration had proposed in the 1998 
budget the elimination of purchaser credits, which are 
basically credits that timber operators get for road 
construction.
    As an alternative, what we proposed was that timber 
purchasers build in to their bids for particular timber sales 
an estimate of the costs of road construction. And we assumed 
that would then, of course impact total bids, would reduce 
revenue to the treasury by some degree. It certainly does 
affect the 25-percent payments.
    Senator Cochran. Do you intend to do this by administrative 
decision, or are you suggesting that legislation be passed to 
authorize this elimination of that credit? What does the budget 
actually suggest?
    Mr. Lyons. I believe we have the authority to do so, 
although there is a proviso I would add, and that is to address 
the concern that you raised that some small operators, 
particularly small businesses, may find themselves in a 
position where they do not have the capital to invest in road 
construction up front.
    We would look to change the authority we have under the 
purchaser credits to expand the purchaser elect program. That 
is where a purchaser would come to the Forest Service and 
basically say: I cannot afford to build the road; you build the 
road for me. And then I would like to be able to purchase the 
timber.
    That, we would require additional authority to address.
    Senator Cochran. OK. Let me ask you this: Would you put in 
the record for us so we will know what we are talking about in 
terms of practical results of this change what the change will 
be, if any, in the amount of timber harvested and sold or the 
price impact that it will have on the cost of timber to 
ultimate consumers and users, like any additional housing costs 
and the like?
    Could you do that analysis for us, or have you already done 
it? Maybe you have already done it.
    Mr. Lyons. I do not know that there would be the latter 
impact that you are concerned about, Senator, but we will 
certainly prepare that analysis and provide you the 
information.
    [The information follows:]

      Analysis of Effects of Elimination of Purchaser Road Credits

    The fiscal year 1998 Budget proposes to discontinue timber 
purchaser credits as one means of providing for road 
reconstruction and construction required in support of planned 
timber sales. These are roads planned as part of the permanent 
transportation system.
    Timber purchasers would be required to reconstruct and 
construct roads as a direct cost similar to other purchaser 
costs associated with the sale, such as felling, removing, and 
hauling the timber from the sale areas. Construction and 
subsequent obliteration of temporary roads are currently, and 
will continue to be, other direct sale costs to the purchaser.
    The Road standards will not change from current 
requirements nor will the Forest Service engineering 
responsibilities to plan, locate, design, and supervise road 
construction or reconstruction change if purchaser credits are 
eliminated.
    Elimination of purchaser credits may have some effect on 
the competition for timber sales, but will not affect the 
number of sales. Those prospective purchasers without the 
financial resources to carry the costs of road construction 
until they sell the timber may no longer be unable to bid 
competitively for the timber offered.
    Consideration is on-going to determine under what 
conditions purchasers may still use the current purchaser elect 
program to have the Forest Service reconstruct or construct 
roads required by the timber sale. This would mitigate the 
impact on purchasers of eliminating purchaser credits.
    The elimination of purchaser credits would not affect the 
amount of timber offered, sold, or harvested.
    Bid prices for timber would be expected to decline as they 
reflect both the loss of purchaser credits and the possible 
additional costs to the purchasers of the costs to borrow funds 
to complete required road construction and reconstruction. 
Lower bids should cover these additional purchaser costs 
without resulting in the need to raise the prices for lumber 
and other products for the consumer.
    National forest timber receipts would be expected to 
decline commensurate with the costs of the road construction 
and reconstruction that must be completed by the timber 
purchasers without purchaser credits.
    In addition, any reduction in timber receipts would also 
reduce these payments. Because states and counties receive 25 
percent of purchaser road credits as a portion of total timber 
receipts, elimination of these credits would reduce payments to 
states and counties by a like amount.
    The Administration is concerned about the impact on 
payments to counties and is considering language which would 
provide that the costs of permanent roads would be counted as 
money received for the purposes of calculating payments to 
States.

                           timber sales level

    Senator Cochran. OK. One other question on that subject is 
that I understand that in the budget you also propose that the 
timber sale level for the southern region, region 8, be reduced 
from 835 to 675 million board feet in fiscal year 1998. Is that 
a direct consequence of the change in the purchaser credits, or 
what drives that decision?
    Mr. Lyons. No, sir; I would suggest it is a function of a 
couple things, and maybe Mike wants to comment on this, 
although he was not in a position to have a real hand in those 
original allocations.
    I think one is simply trying to make the most efficient use 
of the timber dollars we had incorporated in the 1998 proposal 
and make sure that we had adequate investments in other regions 
of the country.
    I think the other is there has been some concern that there 
is the potential for over cutting the Southeast, which is our 
most productive region. And we are trying to beef up our 
inventory and monitoring so as to assess what represents a 
sustainable supply.
    I would not suggest that we are exceeding sustainable 
harvests in the Southeast at all yet, but in the long term this 
is an issue that we are addressing.

                           beaver management

    Senator Cochran. We have a couple of parochial problems. I 
am going to just submit questions on them, but one has to do 
with research. And another has to do with control of the beaver 
population in the national forests.
    I do not know whether you realize this or not, but this is 
a problem because beavers are building dams and they are not 
controlled in the national forests. And what happens is the 
waters are flooding adjacent private landowners. And this is 
causing a big problem.
    The private landowners expect the Forest Service to try to 
do something about this. Of course, private landowners cannot 
legally go onto the public lands and tear down a beaver dam or 
blow up a beaver dam or anything to relieve the flooding on 
their crop land. But this is a serious problem. I hope you will 
be able to look into that and tell us what you are going to do 
about it.
    [The information follows:]

                             Beaver Control

    We assume you are addressing the difficult problems we have 
had on the Delta National Forest in Mississippi. With funding 
you helped secure in fiscal year 1997, we have aggressively 
worked with the Animal Plant Health Inspection Service, Animal 
Damage Control (APHIS, ADC) and with local landowners to 
identify problem areas and treat them. In the last 19 months we 
have removed over 1,562 problem beaver and over 500 beaver dams 
on the Delta National Forest and adjacent areas. In August 1994 
we have had over 14,000 acres flooded during the summer months 
on National Forests and adjacent private lands.
    Today we have about 2,000 acres wholly within the Forest 
that we manage as summer flooded land. Through an agreement 
with APHIS, local Forest Service officers administer a contract 
with private trappers to attack problem areas on both National 
Forest lands and adjacent private drainages with permission of 
the landowners. If local landowners report a problem, our field 
people can generally respond within a few days. Most of this 
work has been done with a $74,000 appropriation this last year.
    If funding had not been provided through APHIS, this work 
would not have been possible. The operation plan calls for 2 
years of aggressive trapping and dam control, followed by 2 
years of intermediate treatments, followed by annual low level 
maintenance. Funding for the second year is not included within 
the President's budget request for the Forest Service, and 
would logically be provided through APHIS as it was in fiscal 
year 1997.

    Senator Cochran. Thank you very much.
    Thank you, Mr. Chairman.
    Senator Burns. Senator Reid.
    Senator Reid. Chairman Stevens, you have awhile that you 
are going--I do not want to interfere with you.
    Senator Stevens. Senator, go ahead. I have just been told 
that I am going to have to leave at 10:30, but go ahead. I have 
time.
    Senator Reid. Well, I will just take 5 minutes.
    Senator Stevens. If it will relieve you, I will come back, 
Senator. [Laughter.]

                       tahoe basin/forest health

    Senator Reid. Mr. Chairman, I have just a few questions. 
One of the concerns we have in Nevada is, of course, with the 
Tahoe basin. The President has agreed to come there this summer 
to hold a summit, have California and Nevada represented there, 
and look at that very distressed resource that we have.
    Talking about forests generally, though, is the Forest 
Service changing the way they do business to improve forest 
health? And I assume this picture is an example of that, is 
that true?
    Mr. Dombeck. Yes; and I discussed that early. But just let 
me elaborate on a few points again. No. 1 is that I have been 
to the Tahoe basin many times and am well aware of the forest 
health problems there.
    We estimate that we have about 39 million acres of high-
risk or catastrophic fire. And as a result of long-term fire 
suppression and various management strategies over the years, 
we have situations where we have a very high density of trees 
now as compared to what was the natural situation.
    We might have had 100 stems per acre of ponderosa pine, for 
example, and depending upon rainfall and other things, today we 
might have 1,500, 2,000, 3,000 stems per acre as that first 
photograph on top indicates. We have not only a higher density, 
but trees competing for moisture, for the nutrients that are 
there.
    Because of the crowding, they are less vigorous, they are 
more susceptible to bug kill, to disease problems.
    What we need to do is we need to get in there and use 
whatever tool we can from the standpoint of management. The 
tools go all across the board from prescribed fire to logging, 
to thinnings, to perhaps grazing, to a wide variety of things.
    Part of the challenge we have is the social environment, 
the fact that--and again, I mentioned this earlier, that what 
people are telling us--and I assume that this is really true in 
Tahoe--that they want the forests to look like forests.
    They do not want to see a hill, a mountainside that is bug 
killed. They do not want to see a mountainside that is black 
from a catastrophic fire, nor do they want to see a 
mountainside that is clearcut.
    And what we--and we have these--we know what the 
silvicultural practices are needed to get in there and work on 
some of that stuff.
    What we need to do is build our local support base, so we 
have the level of trust, and we do not end up in court and in 
litigation and shutdowns as we have to do the things we need to 
do.
    Senator Reid. To do the things that you have indicated you 
need to do, do you have the resources to do it, thinning and 
all the things you have mentioned?
    Mr. Dombeck. No.
    Senator Reid. So what are we----
    Mr. Dombeck. We are projecting that in 1998 we will be able 
to do 800,000 to 1.3 million acres using a variety of tools. 
And what we would like to do is be able to do at least 3 
million acres a year to sort of catch up on the backlog.
    And let me just give you a contrast to the expense. For 
example, some of the practices we can do for $10 to $15 per 
acre to maybe $100 per acre. When we deal with suppression in a 
catastrophic wildland fire, we can be talking anywhere from 
$1,000 to $4,000 an acre in cost of dealing with suppression.
    So what I am--the point I want to get across is we need to 
get in there and manage this before the trees die. We need to 
have an environment where we are not dealing with these 
catastrophic fires, that we have the appropriate stand 
densities and make sure that we have a public awareness of the 
problems.
    Senator Reid. Do you see then, Dr. Dombeck, more fires 
coming with the management that obviously is not going to take 
place?
    Mr. Dombeck. Well, the trend of acres of severe fires has 
been increasing over the last couple of decades. In fact, I 
think fires of the 6 million-and-some acres that burned last 
season, most of that was on Bureau of Land Management lands 
just because we had high moisture levels in a lot of the 
forests.
    And of course that--there was higher moisture levels in the 
forests, but also we had increased grass growth on some of the 
BLM lands.
    Senator Reid. So in answer to my question it is ``yes,'' 
there will be more fires unless you get more management tools 
in there.
    Mr. Dombeck. Yes.

                             water quality

    Senator Reid. What about water quality? We of course are 
concerned about that also in the Forest Service.
    Mr. Dombeck. Well, I think water quality is part of the key 
original mission of this agency, of sustaining favorable water 
flows.
    But a lot of the things that we need to do in investing in 
watersheds, in addition to the vegetation management practices, 
is bringing roads up to standards, roads that may have been 
built decades ago.
    For example, I think the roads money requested is for about 
2,300 miles of roads. But of that, only 300 miles are new 
roads. The remaining 2,000 are upgrading and----
    Senator Reid. With the floods we had around the first of 
the year in northern Nevada this year, we believe a lot of that 
was because of the watershed problems that we had in the 
forests. And this is happening in other places in the country, 
is that not true?
    Mr. Dombeck. I think--you know, one of the most important 
things that we can do is practice the silviculture and the land 
management practices that will keep the topsoils on the land, 
keep the sediments out of the streams. And we know how to do 
most of those things.

                           recreation demand

    Senator Reid. My last question--I really appreciate my 
friend from Alaska allowing me to take my time out of sequence. 
Since I have been here this morning at least, there has been a 
lot of talk about the cutting of trees, which I know is 
important. But in the areas in Nevada we are more concerned 
with recreational use of forests.
    Is there anything that the Forest Service can do to meet 
the public recreation demands in the national forests, which 
are becoming more intense each day that goes by in Nevada?
    Mr. Dombeck. Well, recreation, as again I mentioned 
earlier, is one of the growth areas, based on the demographics. 
We have some 80 percent of the people in the United States 
living in large urban areas.
    With the growth they are experiencing in Las Vegas and so 
on, we have had a--I see the 10-year change in Nevada has been 
from 2.1 million recreation visitor days in 1986 to 3.8 million 
in 1996.
    So there has been tremendous growth in this area. And we--
--
    Senator Reid. And frankly during that period of time, we 
have done very little to help the forests as far as improving 
the recreational areas or even putting toilet facilities in 
some of those that are badly needed because of the almost 
doubling of use in less than 10 years.
    Mr. Dombeck. That is right. As a matter of fact, we have a 
significant backlog in maintenance of campgrounds, trails, and 
various facilities.
    Senator Reid. Many of the facilities in the area right 
outside Las Vegas were built during the depression by the CCC 
workers and have not been upgraded basically since then. And 
that is a significant problem for us.
    Thank you, Mr. Chairman.
    Senator Burns. Senator Stevens.
    Senator Stevens. Thank you.
    Senator Reid, I am certain that Nevada could manage those 
forests a lot better than they are being managed now for 
recreation, if that is what you want to do with them. And I 
would be happy to talk to you about that sometime.
    I think we ought to look at finding a way we can have this 
recreation managed without the tremendous cost of playing like 
we are going to manage the forests, the national forests, for 
forest production.
    Mr. Lyons, the Sierra Club's announced position by vote 
nationally was that there be no harvest of timber, commercial 
harvest of timber, from the national forest lands. You are 
aware of that, are you?
    Mr. Lyons. Yes, sir.
    Senator Stevens. Are you a member of the Sierra Club?
    Mr. Lyons. No, sir.
    Senator Stevens. Are you, Mr. Dombeck?
    Mr. Dombeck. No, sir.
    Senator Stevens. Have you had correspondence with the 
Sierra Club concerning that matter, their position?
    Mr. Lyons. Me personally? No, sir.
    Senator Stevens. The Department.
    Mr. Lyons. I cannot speak to what----
    Senator Stevens. Well, I want to make a request that I be 
given a copy of the correspondence that you have received and 
the replies you have given the Sierra Club pertaining to their 
concept of national policy not to harvest timber from the 
public lands, particularly from the Forest Service.
    Mr. Lyons. I would be glad to that, sir.
    [The information follows:]

                       Sierra Club Correspondence

    The Forest Service does not recall having received any 
specific correspondence from the Sierra Club regarding their 
relatively new policy against timber harvest on public lands. 
We have searched our databases covering our tens of thousands 
of documents without finding such correspondence. We will 
continue to keep this request in mind should any correspondence 
on this subject be received in the near future, and would be 
happy to provide copies of it at that time.

                           insect and disease

    Senator Stevens. All right. Let me shift over to the 
problem of the insect kill in my State. In your report, which 
is forest insect and disease conditions in 1995, published in 
December 1996, states that the number of trees that died in 
1995 from infestation totaled 27 million trees in Alaska.
    That represents a mortality of over 1.2 billion board feet 
of timber resource or approximately 4 years' worth of harvest 
volume from the Tongass National Forest.
    To my knowledge, that has not been a beetle kill in the 
area that was left open to harvest. I could be corrected on 
that, but my memory is we have a 17 million acre forest; 1.7 
million acres was left open to harvest originally under the 
1991 act.
    And the Department has now withdrawn for administrative 
purposes 600,000 of that. So we are down somewhere to around 
1.1 million acres being available for timber harvest.
    To your knowledge, is any of the beetle kill in the 1.1 
million acres that is still open for harvest?
    Mr. Lyons. I could not tell you that specifically, Mr. 
Chairman. I will have to get you that information.
    [The information follows:]

                Harvestable Tongass Beetle Killed Timber

    In 1995, the spruce beetle infestation in Alaska totaled 
893,000 acres. The infestation increased in size to 1.1 million 
acres in 1996. Of the 1.1 million acres, 1 percent or 12,730 
acres were on the Tongass National Forest. These acreages are 
where the beetle is currently active and tree mortality is 
occurring.
    The 27 million figure that you got from our report was 
misquoted in the testimony. The number represents trees 
reported as having died in 1995, not the number of acres.
    None of the 12,730 acres of spruce beetle infestation 
reported in 1996 on the Tongass National Forest, is available 
for harvest. Beetle kill in the Taku River Drainage and on the 
Dall Island is in a land use designation of semiremote 
recreation. Beetle kill in the Stikine River delta area is in a 
land use designation of wilderness. These are the land use 
designations in Alternative 11 of the Tongass Land Management 
Plan revision (preferred alternative).

                              takoo river

    Senator Stevens. I have searched this report, and I do not 
see it, although it does talk about the Takoo River infestation 
at 3,900 acres, Taquin River Delta at 2,040 acres.
    I do not know of any, but my problem is this: In view of 
the fact that it is very costly to use this process--and, Mr. 
Dombeck, you might want to comment--it is my understanding that 
that timber was put up for harvesting in selected areas to stop 
the flow of this natural fire. It is worse than a fire.
    The amount that was lost in the last year alone for insect 
kill in my State is worse than the largest fire in the history 
of Alaska, which was some 20 million acres.
    Now these 27 million trees are gone. We still have less 
than 1.1 million acres available for timber harvest. Why has 
not some of this timber in these infested areas been opened to 
harvest and get some money out of it, so that you can finally 
achieve the objectives of trying to control this insect kill.
    It is more than beetles, I understand. It is--I guess the 
worst part is the beetle kill, but there are lots of other 
worms up there, I understand, that are feeding on them, too.
    But why has not some of that been put up for harvest?
    Mr. Dombeck. Well, I cannot speak to the specific areas. I 
do not know if anyone here has the detailed knowledge of the 
areas.
    Senator Stevens. The Forest Service just stood by and 
watched a natural, the equivalent of a fire, 27 million trees 
killed in a year. And it is a footnote in a report. And we are 
arguing over having access to 1.1 million acres, which was 
reserved for timber harvest and is now shut down.
    In effect, you have done what the Sierra Club wanted. You 
have shut down the whole State of Alaska to timber harvest. I 
want to know, is this your goal?
    Mr. Lyons. It is not the goal. Let me just respond, Mr. 
Chairman, that I do not know the details either of this 
specific case, but it certainly would be our general practice 
in the national forests that when we have a situation like 
that, it is appropriate to salvage as much of the timber as 
possible, sales will be put up and they will be salvaged.
    Of course, the Tongass is operated in a somewhat different 
way than the other forests of the country because of the 
management plan. But we would have to get the details of that 
for you and see if we can explain that to you, sir.
    [The information follows:]

                     Tongass Beetle Infested Timber

    There is a large and serious spruce bark beetle infestation 
that has been occurring in Southcentral Alaska on the Kenai 
Peninsula. The Forest Service has been working with the State 
of Alaska, other federal agencies and the public to try to 
resolve this complex issue.
    The primary insect infestation area is located 
approximately 500 miles from the Tongass NF. It is widely 
spread in the interior of Alaska and in Southcentral Alaska, 
and is typically much smaller and of shorter duration in 
Southeast Alaska. Approximately 2 percent of the beetle damage 
is located on National Forest System lands; 1 percent each on 
the Tongass and Chugach National Forests. Due to the nature of 
the forests in Southeast Alaska insects and diseases have had 
limited effects on overall timber availability. Also, timber 
harvest is not shut down on the Tongass NF but has been reduced 
because of recent mill closures.
    The 1979 Tongass Land Management Plan was the first forest 
plan completed under the National Forest Management Act of 1976 
and was updated in 1986 and 1991 through plan amendments. In 
recent years a great deal of effort and funding has gone into 
revising the forest plan (approximately $13 million). The 
Record of Decision for the revision has been recently signed. 
The new forest plan will provide for sustainability in all the 
resource areas and consideration of the impact on people and 
communities. The new forest plan revision establishes an annual 
sale quantity (ASQ) of 267 mmbf.

                            infested timber

    Senator Stevens. Well, I have been around government a long 
time, you know. I was assistant to the Interior Department. 
Before that I was a U.S. attorney, and I have been around here 
now for 29 years. I have never seen Federal employees ignore 
the law to the extent that you all have.
    You have spent now $30 million studying 1.7 million acres 
to see how much timber should be harvested out of it over a 
period since 1993. In the same period of time, you are losing 
annually, losing, more timber from these beetle kills and these 
insect kills than we have ever lost to wildfire.
    And yet you continue to spend the money studying that one 
area that is open to timber to prevent it from being timber 
harvested and just stand by and watch this other timber just go 
down. It is my understanding that it is spreading so badly 
now--and again, I am quoting from your own report.
    There is increasing concern that the endemic and graver 
beetle populations in budworm impacted areas may take advantage 
of the stressed trees and explode to outbreak proportions.
    Also of concern to biologists is the predicted crash in the 
red squirrel populations. Red squirrels are highly dependent 
upon spruce cones for winter food. Interior spruces have not 
had a cone crop for almost 5 years.
    And to my knowledge, no one has ever come to my office and 
said: We would like to have your help trying to save some of 
these trees.
    You are trying to save the trees from cutting in 
southeastern in 1.1 million acres, spent $30 million to prevent 
cutting. And at the same time we are losing some 27 million 
trees a year to this invested area. Then you wonder why we are 
concerned about the management of the Forest Service under this 
administration.
    That indictment is so bad in my opinion that you all ought 
to offer your resignations. You are not carrying out the law. 
And I just--I get so frustrated, I cannot even hardly think 
when I see what is happening to my State since you all have 
come into office.
    It is probably the worst, worst situation I know of in the 
history of the U.S. Government from the point of view of 
management.
    I will have some further questions later. I will submit 
them for the record.
    Thank you, Mr. Chairman.
    Senator Burns. Senator Bumpers.
    Senator Bumpers. You have been there since January, and you 
have done an awful lot of damage, Mr. Dombeck, according to 
Senator Stevens.
    Millions of acres of beetles have infested the forests, and 
you will not let him cut anything off of it. You have been 
there 4 months, and you have not stopped the beetles.
    Now you say you are not a member of the Sierra Club, is 
that correct?
    Mr. Dombeck. That is correct.
    Senator Bumpers. And you, Mr. Lyons, you are not a member 
of the Sierra Club?
    Mr. Lyons. No, sir.
    Senator Bumpers. You are not old enough to remember the old 
question, ``Are you now or have you ever been a member of the 
Communist Party,'' are you?
    Mr. Lyons. I have read about it.
    Senator Bumpers. I am not going to ask, do not 
misunderstand.
    Mr. Lyons. Thank you, sir.
    Senator Bumpers. Mr. Dombeck, what authority--I was really 
interested to follow up on what Senator Stevens said.
    What authority do you have under existing law to declare an 
area salvage because of beetles or natural disasters and put 
timber up for sale because of it?
    Mr. Dombeck. I would have to----
    Senator Bumpers. And let me pursue that one step further. 
Is the law different on the Tongass than it is on forests in 
the lower 48 in that regard?
    Mr. Dombeck. Staff tells me the law is not different.
    Senator Bumpers. The law is the same?
    Mr. Dombeck. Is not different. Is that correct?
    Senator Bumpers. Well, then the question is: What authority 
do you have to determine that an area should be declared 
salvage and harvested so that it will not be lost?
    Mr. Dombeck. Well, I--the authority, and I can cite several 
examples of where fairly rapid salvage has occurred, of course 
Hurricane Hugo, some of the storm damage that occurs from 
hurricanes, from tornadoes.
    In fact, I think in your State, Senator Burns, in the far 
south, the northwestern corner of Montana and northern Idaho, I 
know it hit Idaho with a very severe ice storm that broke trees 
off this big around.
    And our employees are continually doing surveys. What we 
need to do is get in here and manage the forests to prevent 
those kinds of problems over the long haul. Much of what we are 
talking about here is, in a sense, not a silvicultural problem. 
It is a social problem, the way that people feel about forests, 
that we are dealing with.
    We have some of the best foresters, silviculturists in the 
world working for these agencies, and--let me maybe ask Dave or 
Janice if they would like to elaborate on the specifics of the 
authority.
    Senator Burns. Well, if I might, excuse me, if the Senator 
would yield, that is not answering his question.
    Senator Bumpers. That is what I was just getting ready to 
say. Go ahead.
    Mr. Unger. I was just going to amplify a little by saying 
that out of our 1998 planned timber program about one-third is 
expected to be composed of salvage sales based on insect or 
disease damage or other disasters.
    Senator Bumpers. Well, let me reiterate the question. Do 
you have legal authority, to declare that an area has been so 
invested with beetles or some other insect and will continue 
and that the forest will be lost for any productive reasons 
unless it is cut?
    Do you have the generic authority and law to declare an 
area a salvage area because of insect infestation?
    Mr. Unger. My understanding is that we can conduct salvage 
sales for that purpose under our existing authority. There are 
some cases where we have to ask for special permission, if it 
is in a wilderness area, and, therefore, would require some 
treatment.
    Senator Bumpers. What is your special permission? Who do 
you get it from?
    Mr. Unger. I believe that we get it from the Secretary of 
Agriculture.
    Senator Bumpers. Are you familiar with the situation that 
Senator Stevens was alluding to, that has been so severely 
damaged by beetles that it should be declared salvage and 
harvested? Are you familiar with that area that he is talking 
about?
    Mr. Unger. I am not familiar with the situation----
    Senator Bumpers. Are any of you?
    Mr. Unger [continuing]. That the Senator brought up.
    Mr. Lyons. No, sir.
    Mr. Dombeck. The briefing that I have on that topic--and we 
will verify this again for the record--is that about two-thirds 
of the infestation is on State and private lands. About 1.1 
million acres of active and newly infested areas were detected 
in 1996, about half a million acres on the Kenai Peninsula and 
about 154,000 acres in the Copper River area.
    Senator Bumpers. Well, I may have misunderstood Senator 
Stevens. I thought he was alluding to 30 million acres.
    Mr. Dombeck. And we will double check that for the record.
    Senator Bumpers. Well, send me a copy of that, too. I am 
interested in that.
    In all fairness, Senator Stevens and I often disagree on 
these issues. But I must say what he said this morning, if that 
were true, that would be very disturbing to me.
    [The information follows:]

                 Spruce Beetle Killed Timber in Alaska

    Of the 1.1 million acre infestation reported in 1996, 
12,730 acres (1 percent) occurred on the Tongass National 
Forest. A total of 757,111 acres (67 percent) occur on State 
and private lands including Native Corporation lands.

  ACRES OF SPRUCE BEETLE INFESTATION IN ALASKA BY OWNERSHIP REPORTED IN 
                                  1996                                  
------------------------------------------------------------------------
                Ownership                      Acres          Percent   
------------------------------------------------------------------------
State and private.......................         418,357              37
National Forest:                                                        
    Tongass NF..........................          12,730               1
    Chugach NF..........................          14,042               1
Other Federal...........................         346,873              31
Native Corporation......................         338,754              30
                                         -------------------------------
      Total.............................       1,130,756             100
------------------------------------------------------------------------

                                 roads

    Senator Bumpers. Let me ask you, regarding timber, 
purchaser road credits do you have generic authority now in a 
timber sale to declare that you are not going to allow, I mean 
road building, to be a credit against the contract price? Do 
you have the authority to do that now?
    Mr. Lyons. Yes, sir.
    Senator Bumpers. You do have?
    Mr. Lyons. I believe so.
    Senator Bumpers. Congress gave it to you?
    Mr. Lyons. Well, Congress gave us the authority to 
establish road credits. So that is kind of an additional 
authority we have. We do not have to offer credits on any 
particular sales.
    Senator Bumpers. So if you do not want a sale to include 
credits for building roads, you just do not include that in the 
request for bids.
    Mr. Lyons. It would be part of the contract.
    Senator Bumpers. Pardon?
    Mr. Lyons. It would be part of the contract, part of the 
proposal for that particular sale. Yes, sir; we would like not 
to do it.
    Senator Bumpers. You know, this is not all that big, but 
just as a lawyer, I want to get this straight. You say it would 
be part of the contract. If you ask somebody to bid on a tract 
of timber and then also, as a part of that proposal, tell what 
part of the cost will be road building, if you do not put the 
road building part in it, whose obligation is it to build a 
road?
    Mr. Lyons. It would be the purchaser.
    Senator Bumpers. And he does that at his own expense?
    Mr. Lyons. Yes; and that is why we would anticipate it 
would certainly affect the price he bid for the timber.
    Senator Bumpers. So what he would do, if he were going to 
bid $100,000 for the timber, and in his own mind it was going 
to cost him $30,000 to build the road, he would just bid 
$70,000?
    Mr. Lyons. Yes; he would be bidding less. That is correct.
    Senator Bumpers. But he would just personally take into 
consideration the cost of the road building.
    Mr. Lyons. Yes, sir.
    Senator Bumpers. Without you mentioning it in your 
contract? Would your contract not provide that he was to build 
the road? Request for bids?
    Mr. Lyons. Ordinarily, and it has been a long standing 
policy, that we would provide for a first-year credit for those 
roads. If we elected not to, then we would make that clear up 
front.
    And then the purchaser would have to take that cost into 
consideration in making whatever bid he or she would make for 
the timber.
    Senator Bumpers. Does the Forest Service ever build roads 
to fulfill a contract?
    Mr. Lyons. Yes, sir; in two ways. One is we do continue to 
build some roads. We are mainly focused on multipurpose roads 
now--that is, roads that provide recreation access, et cetera--
that will allow entry into new units. And that is with 
appropriated dollars.
    There is another mechanism, though, that is used somewhat. 
And that is where small businesses elect to have the Government 
build the roads for them, rather than accept credit. And we 
call that the purchaser elect option.
    Senator Bumpers. Well, I was just curious as to how the 
program worked.
    In my State we were ravaged by tornadoes back in early 
March. And I flew from Little Rock down to Arkadelphia, and you 
could just see the swath of timber all the way from Little Rock 
to Arkadelphia, in places one-quarter mile wide and other 
places as much as one-half mile wide, where the timber was just 
leveled.
    That is private timber, so you do not have to worry about 
salvage sales. The amount of timber destroyed on the forest, 
the Ouachitas, was fairly limited, I think.
    But my question is this: We have about 13,500 acres valued 
at $6 million in the area that was hit by the tornado, 13,500 
acres. Now, this is privately owned timber, and they will 
salvage that timber and get what they can out of it, I suppose.

                              stewardship

    But the question is: Some of them are having a terrible 
time with debris clearing, site preparation and replanting. 
There is no money in SBA, and there is no money in FEMA to do 
that. Does the Forest Service have any fund that could possibly 
be tapped for that purpose?
    Mr. Lyons. I believe we would, Senator. And I think we 
could probably fund that through the stewardship program under 
the State and private portion of our budget, particularly----
    Senator Bumpers. Say that again. I did not understand.
    Mr. Lyons. Under the stewardship program, which is in the 
State and private segment of our budget, we have provisioned 
for site preparation and replanting, as well as other landowner 
assistance programs. So I would imagine that we could work with 
the State forester to develop a proposal and get that area 
cleaned up.
    Senator Bumpers. Well, I would like to nail that down.
    Mr. Lyons. And we will second that. We would also like 
folks to know that the stewardship program is available because 
it is an extremely important tool for us to assist private 
landowners.
    Mr. Dombeck. And we will provide you the details of that in 
writing. Those funds are somewhat limited because of the size 
of our State and private program, but there are--we will get 
you that in writing.
    [The information follows:]

                              Stewardship

    The Forest Stewardship Program and the Stewardship 
Incentive Programs were established by Congress under the 
provisions of the Cooperative Forestry Assistance Act of 1978. 
Together, the purpose of the programs is to provide financial, 
technical, educational, and related assistance to State 
Foresters in order to help non-industrial private landowners 
manage their forest lands.
    The Programs emphasize managing and enhancing the 
productivity of timber, fish and wildlife habitat, water 
quality, wetlands, recreational resources, and the aesthetic 
value of forest lands. State Stewardship Committees in each 
State identify program priorities for their State, which could 
enable a focus on site preparation and replanting activities 
within available program resources.
    Landowner requests for stewardship assistance through the 
programs exceed appropriated funds available. Even as 
appropriation levels have decreased, requests for stewardship 
assistance have increased. In some states, three times as many 
landowners request assistance as receive it.
    In the past, funds for debris clearing and site restoration 
after natural disasters such as the recent tornadoes in 
Arkansas, have been provided by the Federal Emergency 
Management Agency (FEMA), or through supplemental funding 
provided by Congress.

                                fte hits

    Senator Bumpers. Just 1 second, Mr. Chairman.
    Now, you are going to take a 14-percent FTE hit in 1998, is 
that correct?
    Mr. Lyons. I believe so.
    Senator Bumpers. You are the biggest employer in the 
Department of Agriculture.
    Mr. Lyons. That is correct.
    Senator Bumpers. And I assume, my staff tells me that the 
plan is to leave you with 36,000 FTE's. That 36,000, is that 
after the 14-percent cut in personnel?
    Mr. Lyons. No; let me be clear. Right now we are at 37,184, 
actually 35,784. That is the adjusted total. And we would go 
down in 1998 under our proposal to 34,943. So that is not quite 
14 percent, not at all. I will have to check the numbers.
    Senator Bumpers. Well, Mr. Chairman, I will not take any 
more time. We may submit a couple questions in writing, but I 
just want to make this comment. Everybody applauds reduction in 
force.
    And the Vice President has been very actively involved in 
it, and the President has made a great deal of it. And that is 
fair. They have done a really great job of reducing the number 
of government employees in this country.
    But I keep looking at this and monitoring this, and I 
wonder sometimes when that is going to become 
counterproductive, because it certainly will become 
counterproductive if we continue it at the current pace.
    I do not know at what level that occurs, but we depend on 
people like you to come here and be honest, even if it means 
saying to the Vice President: You know, what you have done to 
us is going to substantially reduce our effectiveness in 
managing the forests and running this department.
    Mr. Unger. Senator Bumpers, I think the 14-percent figure 
you are referring to may refer to the loss in employees over 
the past several years.
    Senator Bumpers. Is it?
    Mr. Unger. Yes.
    Senator Bumpers. I would say that is an awful big hit for 1 
year.
    Mr. Unger. Not for 1998, but for 3 or 4 years.
    Senator Bumpers. OK. Well, my statement still stands, Mr. 
Chairman. I thank you.
    Senator Burns. Senator Dorgan.

                               grasslands

    Senator Dorgan. Mr. Chairman, thank you very much. I regret 
I was delayed because of other committee commitments.
    Let me just ask one question of the Chief of the Forest 
Service. It is a question we discussed the other day. The 
Forest Service is engaged in creating a revised Forest Service 
plan, which includes the grasslands in North Dakota.
    I had received assurances, and the folks who are involved 
in grazing associations had received assurances, from the 
Forest Service that ranchers and environmentalists and other 
interested parties would be consulted as the plan is developed.
    And as I indicated to the Chief, those involved in grazing 
have told me recently that there has been no consultation. I 
hope that you perhaps have had an opportunity to look into 
that, or will at least, and tell me what kind of approach will 
be used to bring everyone into the consultation process in this 
development of a plan.
    Mr. Dombeck. Yes; I talked to the staff about that after 
our meeting, and perhaps I will have Janice respond.
    Ms. McDougle. The effort that is underway in the great 
plains is probably the most significant effort in terms of 
looking at the grasslands in a holistic way. The assessment 
covers national forests. And the plan is that at the time the 
assessment is completed, the forest plans will be revised to 
reflect those outcomes.
    There have also been a number of other efforts. I led a 
national grasslands review 1 year ago. And since then we have 
formed the National Grasslands Council, who are dealing with 
some of the things that we heard from the over 300 people, 
permitees, ranchers, State and local officials, and just 
citizens within the national grasslands, to respond to their 
issues and concerns.
    A number of other things are currently under way. So, I 
guess the answer to your question is yes, there will be 
opportunities for the local people to provide input into what 
ultimately are forest plan decisions.
    Senator Dorgan. But that opportunity must be 
contemporaneous. And what I think grazers said to me is, they 
see something going on there behind closed doors, whatever it 
is. And they were assured that during this process there would 
be a consultative role, and they say that there has been no 
effort to consult with them.
    Mr. Dombeck. Well, just let me assure you that will be 
fixed.
    Senator Dorgan. Please do.
    Mr. Dombeck. And we will get back to you with a response on 
what action was taken. One of, the hallmarks that we need to do 
is the more we work together with people, that does not mean we 
always agree, and with local communities, the better 
understanding we have and I think the more buy-in and better 
results of the plans.
    What is really important is what happens on the land. With 
the technical expertise that our people can provide, the better 
local relationships we can have. That is what I want to work 
for. And I think that is the way we get results on the ground.
    So I will assure you that will happen.
    [The information follows:]

                       Northern Great Plains Plan

    The Plan revision process for the Northern Great Plains 
encompasses three national forests and multiple national 
grasslands within Wyoming, Nebraska, and both North and South 
Dakota. The stewardship goal of the effort involves extensive 
collaboration with people and communities across the four 
States. To date, the planning team has reported multiple 
involvements with grazing associations through presentations, 
visits, and other communications by District Rangers, Forest 
staff, and the planning team.
    The engagement of people in this process is ongoing and 
open. As a special event, during the week of June 9-13, the 
North Dakota National Grasslands will be hosting a series of 
public open houses across the State. Grazing associations not 
involved to date may contact the Planning Team to discuss 
further opportunities for meaningful and productive 
participation.

                                grazers

    Senator Dorgan. Well, I appreciate that. Most of the 
folks--you know, we have a wide range of people who want to be 
involved in the multiple uses of this land. And among them, and 
important among them, are the grazers.
    And these are ranch families who in North Dakota are 
generally small ranchers. We are not talking about large 
ranchers. They are good stewards of the land.
    When a plan is being developed, they would very much like 
to be a part of the consultative process. And so I appreciate 
your commitment on that.
    I have no further questions, Mr. Chairman.
    Senator Burns. Thank you, Senator Dorgan.
    I have one question. I have to run real quick here, and I 
will turn it over to Senator Craig.

                         bison contingency plan

    Tell me about contingency plans or what you are talking 
about with the Park Service with regard to Yellowstone Park and 
our little problem with bison.
    Mr. Dombeck. Well, as you know, Senator, the Forest Service 
is not in the driver's seat on that issue. What I have offered 
to Montana and the Park Service and those involved is that we 
can provide a relief valve on the Gallatin from the standpoint 
of winter range and those kinds of things. We are perfectly 
willing to play whatever role we can in helping solve that 
bison issue.
    If it takes some land acquisition, if it takes some special 
practices, whatever we can do, the Forest Service is there to 
help be a relief valve until that issue is resolved.
    Senator Burns. Would it be any advantage to you if you 
might advise the Park Service on the care and capacity they 
have within the boundaries of that park?
    Mr. Dombeck. Well, I think our folks at the local level 
have been talking. Dave Garber, the forest supervisor, I am 
sure has close interaction with the Park Service and the 
various things that have occurred this winter.
    My hope is that that problem would be solved out there.

                              brucellosis

    Senator Burns. I think it is being solved, but we are 
taking the heat in the State of Montana for very, very bad 
management as far as the Government is concerned. And I can 
understand the frustration here.
    We only made one mistake a couple years ago. Mr. Lyons 
knows what that is. I capitulated on a situation I wish we had 
not capitulated on now.
    But there are people in Montana that are concerned about 
the extension of the boundary of that park to accommodate 
animals and still no plan is in place to deal with the 
eradication of brucellosis. And that has us all concerned in 
the State of Montana. You might not think it is a big deal. By 
God, I think it is.
    Mr. Dombeck. Well, we do think it is a big deal.
    Senator Burns. Well, then I would--then I want to see more 
action especially with the higher ups here, because I think 
someplace somebody has to start the discussion around here that 
we have a problem out there, and it is not ours.
    It was created by people who have eroded and they have 
equivocated on a court order that was handed down, worked out, 
agreed to by Forest Service, States, and Park Service.
    And yet they have equivocated on that and eroded that plan 
to where there is no integrity to it at all now. And that is 
why we had the incident Sunday of a couple, 3 weeks ago, 
because there is frustration on both sides. And that is what 
happens when you allow those things to happen.
    And I will tell you that we are very concerned, Mr. 
Dombeck, about the extension of that boundary, because once you 
start that, how far does it come, and how much is it going to 
impact the livestock industry and, yes, human health in the 
Gardner area in the Yellowstone Valley and the water quality? 
We are concerned about those things.
    Everybody thinks all the great things about your forests 
and how they are supposed to look and all the great things that 
have been done on care and capacity and all the things done by 
the Government.
    Folks, I am here to tell you none has been done by the 
Government had it not been for people in the private sector 
that understood grasslands and grazing and natural resources.
    So I just want to fire that little shot across the bow. I 
will probably fight like a bearcat, because there has to be 
some kind of management of that herd inside that park. And we 
cannot do it by expanding boundaries.
    And that is going to concern you and the Forest Service, 
and I am not real sure that you have some authority to do that 
unless it takes legislative action.
    I have to make another appointment here. Senator Craig.
    Senator Craig [presiding]. My apologies, gentlemen, for 
racing in and out. Other committees were pulling me away, but I 
did want to get back to ask a variety of questions. And Mike, 
Jim, David, thank you for being with us today.
    I think you can sense by the kind of questions and the 
passion with which they are expressed that there are probably 
fewer issues in some of our Western States where you have a 
very large presence that do not draw more emotion in our 
citizens' minds and concerns than how our forests are managed, 
no matter what your perspective of them.
    I will only suggest to you the concern that Senator Burns 
has about brucellosis in the buffalo herd. It is very difficult 
for anyone to understand the impact of it unless you have been 
there. A good number of years ago, before I came to Congress, 
my father and I operated a sizeable ranch and a sizeable herd 
of cattle.
    One day we sold some cows. We got a notice that one of them 
tested positive for brucellosis. This had been after a 
concentrated effort on our part for decades to keep a clean 
herd.
    We immediately tracked it and found out that it was an 
animal we had purchased. That was not the point. The point was 
our herd was quarantined. All economics on our ranch stopped.
    And we spent over a month spending a lot of money, running 
a lot of cattle down a chute and testing them at expense to our 
business and certainly at a cost of gain to the cattle and 
health of the cattle.
    Some of these animals were pregnant, and you always risk 
aborting a calf if you move them and shove them and all of that 
kind of thing through the kind of facility that we have to to 
do these tests.
    I know there are a lot of people that say, ``Well, we have 
to run the wildlife in a natural way.''
    That is true if man does not exist or there is no interface 
with man. In this instance there is. In this instance it is 
cattle. And there can be human health involved.
    The Federal Government can cost by inaction the private 
sector a phenomenal amount of money. And it is not just a 
Montana issue. As you know, it is a regional Western issue 
because of the nature of the park and the States that abound 
it.
    And that is what we have to be concerned about. I do not 
know any other way to express my sensitivity toward the issue 
than a revolution that would take place in that three-State 
area if the Federal Government does not do their job right. You 
do have an obligation to manage that herd in a managed way, not 
a natural way.
    There are other wildlife that do not have relationships 
with domesticated animals that would transfer disease. But in 
this instance we have one.
    And I know the crisis that our business went through and 
the cost we subjected ourselves to, because it was a mistake of 
our own doing. But if it had been a mistake of the Federal 
Government, we would have been at war with the Government, 
because it was the Government who worked with us historically 
to build this kind of a situation where we did not have 
brucellosis with the testing programs of USDA and the State 
departments.
    So this is all very critical. I express that to you. Few 
people have that perspective, especially from your level unless 
you were born and raised in a livestock setting where you 
understand the critical nature of this. But out where I live 
everybody understands it pretty clearly.
    But somebody who is now playing the business of management 
of the Federal level by the book and has a vision of a 
different kind of management, that is, natural, in this 
instance it does not work. And it is very important that we 
understand that.

                       sawtooth range management

    Mike, let me thank you for the time and the cooperation you 
gave the Idaho delegation the other day in a concern that we 
have on the Sawtooth National Forest. And that concern is 
ongoing as we attempt to deal with how decisions are made and 
how plans come together and how we operate as it relates to all 
of our publics and all of our resource users.
    In the conversation that you and Dave and I had along with 
Dale Bosworth, our regional forester, the other day, as it 
relates to the grazing proposal that Supervisor Levere has put 
forth, in his testimony before a House subcommittee under the 
chairmanship of Congresswoman Helen Chenoweth, made a statement 
that really causes me great frustration, especially when I look 
at the record. His statement was, in essence, in his ability to 
manage the permits and grazing, on these critical ranges and 
habitats, with a range budget that had declined by 
approximately 30 percent in recent years.
    He did not have the money necessary. So he was trying a new 
approach, somewhat sweeping, fairly dramatic. Obviously, it has 
everybody on their toes out there and everybody back here on 
their toes.
    I went back and looked at our appropriation record in the 
area of grazing, and I found--I think I mentioned at the time 
in our discussions that it had gone up some and progressively 
over time. But I did not realize that it had gone up as much as 
it had.
    In 1994, we appropriated $16.3 million. In 1995, $18.5 
million; in 1996, $27 million; and in 1997, $38 million. Now I 
understand there were some NEPA concerns in there as it relates 
to working that program. But that is a 133-percent increase in 
appropriations to manage grazing.
    And we are all sensitive to it here, because we know the 
importance of public grazing in our Western States. But we also 
want it done in an environmentally sound consistent way. And 
that is what our figures show.
    I then have to ask this fundamental question: What happened 
to the money on the Sawtooth, or what has happened to the money 
as it relates to grazing inside the system, if we have 
increased it 133 percent, or somewhere in that area, from 1994 
to 1997, and is not on the ground working its will?
    And, therefore, supervisors make broad and sweeping 
decisions because they do not have the personnel or the time or 
the money, they say, to go in and manage the individual that 
permit these relationships as they are, by the plan, intended 
to do.
    Can you deal with that issue for me?
    Mr. Dombeck. What I can do is ask Steve, who knows the 
numbers, to comment on that. But I want to assure you one of my 
objectives is, as I mentioned the other day, to look at our 
processes and get as much money to the ground as possible. We 
have got to, we have just got to.
    Senator Craig. Yes.
    Mr. Dombeck. And I think there is complete agreement on 
that. I am going to be pushing hard to accomplish that. Let me 
just ask Steve to give you a rundown of some of those numbers.
    Mr. Satterfield. Senator, to begin with there was a major 
budget reform in fiscal year 1995. And the number you referred 
to in 1994 was adjusted to that reform. It was reformed too 
much.
    And in 1995, we reprogrammed $16 million from other 
accounts in the National Forest System appropriation to the 
range line item. In 1996, I believe we reprogrammed another $9 
million.
    So what we have here is basically a flat line total. I 
believe if we had added $9 million to the 1996 appropriation, 
it would have brought it up to about $36 million.
    Senator Craig. So you are saying 1996 was $36 million?
    Mr. Satterfield. It would have been approximately $36 
million.
    Senator Craig. Instead of the $27 million that I quoted.
    Mr. Satterfield. We can get you--yes. The Congress--the 
appropriation included $27 million in that budget line item. We 
did reprogram another $9 million into that line item later.
    Senator Craig. Was that for NEPA?
    Mr. Satterfield. It was for NEPA and grazing management 
both.
    Senator Craig. So there was actually more money than my 
figure showed.
    Mr. Satterfield. Well, there would have about a total of 
about $36 million.
    Senator Craig. What was 1997 then?
    Mr. Satterfield. It is $38 million.
    Senator Craig. $38 million. I was right on that then.
    Mr. Satterfield. Yes, sir.
    Senator Craig. So there is actually a bigger increase than 
I had suggested by my figures.
    Mr. Satterfield. Well, we are about flat from 1996 to 1997 
in real terms.
    Senator Craig. Yes; well, Mike, would I be correct in 
assuming that a great deal of range management funds 
appropriated to the Forest Service were diverted to other 
initiatives outside grazing?
    Mr. Dombeck. I am not sure of that. Let me ask Steve again. 
He follows the region by region budgets very closely.
    Mr. Satterfield. To get real precise, we would have to get 
more precise than I can be right here, but----
    Senator Craig. OK. Well, we are going to ask you to get 
real precise on this one because----
    Mr. Satterfield. But generally no.
    Senator Craig [continuing]. It is raising havoc out there.
    Mr. Satterfield. There is a lot of discussion in the budget 
restructuring system about money being moved out of range into 
other things. We have corrected it. We have moved it back. We 
think--we do not believe it has gone to other things.
    Senator Craig. Nothing went to the east side eco-study?
    Mr. Satterfield. It would have been various assessments 
against various line items for things like----
    Senator Craig. You are suggesting it could have.
    Mr. Satterfield. It could have.
    Senator Craig. One of the other areas that Supervisor 
Levere spoke to was the diversion of time for his range 
conservationists to deal with the adjudication of the Snake 
River basin water.

                              water rights

    There has been a tremendous over filing out there by the 
Forest Service on water rights, 1,700 or somewhere near that, I 
think he told us. I guess that is a management decision.
    But, Mike, do you know if the Forest Service or the 
forester at the regional level suggested that the Sawtooth over 
file on all these water rights and acquire water rights on all 
those water areas?
    Mr. Dombeck. I do not know that. A request was made by Dale 
Bosworth. I could ask, Janice or Dave on the history of that 
particular issue.
    Mr. Unger. Senator Craig, we feel that we are filing claims 
for the water that is required to carry out the purposes of the 
national forests.
    Clearly, it takes a good deal of time of people who need to 
be knowledgeable on what they are talking about, which is why 
some of our range conservationists are so intimately involved 
in that.
    And it is a judgment that has been made by the forest and 
by the region that a management necessity has to be balanced 
with all the other management necessities.
    Senator Craig. Even though the Forest Service has operated 
out there since its beginning and had adequate water and 
supplied those needs and filed appropriately when it felt it 
needed water with the State, why all of a sudden this massive 
over filing?
    Mr. Unger. Well, I do not know that they would consider it 
over filing. But at one time, when an adjudication goes on, 
decisions are made for a long period of time to bring all this 
together in one decision.
    Senator Craig. Was there a budget consideration, therefore, 
made as it relates to this decision?
    Mr. Unger. I do not know, but I would hope that the region 
has certainly looked at this. I know that in other cases where 
we have had adjudications, we have tried to supplement funds 
available so that there would be adequate funds for the forests 
and for the region to do that.
    Senator Craig. Well, we are obviously going to take a much 
closer look at this, because it is not only frustrating, as you 
know, it is more than that. It is angering when this Congress 
recognizes the sensitivity of grazing to the environment, but 
the importance of grazing as a part of our public land resource 
use out there.
    We appropriate the money, and then the money does not get 
to the ground. And, therefore, the kind of very arbitrary and, 
I think, capricious kind of decisionmaking that the supervisor 
of the Sawtooth got himself involved in at this moment ends up, 
or at least that becomes the excuse. And that should not be 
that.

                                 trails

    Jim, I had mentioned to you in a conversation a month or so 
ago, when we were both attending an event here in town, of an 
activity going on in the panhandle that is important to the 
West, Idaho and Montana, that we had been moving in the 
direction of gearing the panhandle up to spend some money. And 
they are now doing it.
    And, Mr. Chairman, what I am talking about is a unique 
opportunity that we have in the area of recreation. You spent a 
good deal of time this morning talking about recreational 
increases in demand.
    This item is what is known as the Route of the Hiawatha, 
which is the old rail bed of the Milwaukee Railroad. It is a 
45-mile long Idaho/Montana crossing under the Bitterroot 
Divide, 11 tunnels, 9 trestles, a 1.8 mile tunnel that has our 
greatest attraction at the moment, known as Taft Tunnel, that 
goes directly under the divide itself.
    What I am told by all of the experts in this area of 
recreation, primarily mountain biking and hiking, is that this 
will not only be unique, it will be the world-class opportunity 
for about 2,500 miles of trail for mountain biking organized.
    But the stretch we are talking about, the 45-mile stretch, 
is unique because it is rail grade, and it can span an age 
group that is just phenomenal, right up through our senior 
citizens to enjoy this unique, beautiful section.
    In fiscal 1995, we appropriated some money for survey and 
design. In fiscal 1997, an additional $450,000. In 1998, we 
need about $750,000, not currently shown in the President's 
budget, to deal with Taft Tunnel, which will then open it wide 
open and begin to serve, because that is the connecting link.
    And, Jim, as I say, I mentioned this to you. I am going to 
be working on this very closely with the chairman and others, 
because if the Forest Service wants to premier some 
recreational opportunity, this is one that has a bi-State, 
regional impact.
    It is very close the chairman's State, just a few miles 
away from the Washington border. And we are working on bike 
paths coming out of the Spokane Valley that literally could 
take us all the way into that system and make that one of the 
great mountain biking areas of the world, not just the West, 
but the world.
    So that is something that I will be watching and working 
with our chairman on to resolve.
    One last thing, Mr. Chairman. All of you today, especially 
you, I think, Mike, and Jim, have talked about large increases 
in recreational demand. How do you get that measurement?
    Mr. Lyons. The numbers we have cited, Senator, come from 
the forest estimates of recreation visitor days, which is 
basically a 12-hour--it is measured in 12-hour increments.
    Senator Craig. Yes; I understand the method, but how do 
they measure, campground occupancy, passes sold?
    Mr. Lyons. I believe it is done primarily through surveys 
of Forest Service users, although I am not familiar with the 
particular methods.
    Senator Craig. Do you have a sampling system by which you 
arrive at those numbers?
    Mr. Lyons. You know, I am going to have to check with 
research.
    Senator Craig. I want you to check, because here is what I 
think you will find the answer to be: You do not have one. And 
that while we all believe there is increased recreational use, 
that about 15 years ago you departed from any sampling system 
approach, and you are now in the business of guesstimating. 
And, yes, it is probably up a couple percent each year.
    Now, I am not going to be too critical of that other than 
to suggest that if you were driving your budget by certain 
numbers, they ought to be accurate numbers.
    Mr. Lyons. I agree.
    Senator Craig. And my guess is you are on a forest-by-
forest, region-by-region basis in the business of 
guesstimation. Now it may be reasonably accurate guesstimation, 
but do you have sampling systems that can determine the levels 
of accuracy as to rates of growth?
    Mr. Lyons. Let me follow up with you, Senator, and give you 
a detailed explanation of how those numbers are generated.
    Senator Craig. Well, I would really appreciate that, 
because it is a factor important. Do we want to redirect 
dollars, or do we want to change structure as it relates to 
that?
    [The information follows:]

                        Recreation Visitor Days

    The Forest Service tracks recreation use by Recreation 
Visitor Days (RVD's) and by Visits. A RVD is a statistical 
reporting unit consisting of 12 visitor hours. A visitor hour 
is the presence of a person on an area of land or water for the 
purpose of engaging in one or more recreation activities during 
the period of time aggregating 60 minutes. A visit is the entry 
of one person upon a national forest for the purpose of 
participating in one or more recreation activities for an 
unspecified period of time.
    Both RVD's and Visits are estimated by Forest Service field 
units and reported through a computerized reporting system. 
Field estimates are based on the application of sampling 
techniques, traffic counters and other observation methods. 
There are various ways available to display the information 
gathered: by region and by State, by activity, and by year.
    The Forest Service is also experimenting with methods to 
improve recreation use estimates. A prototype process is 
currently being tested. It is intended to provide improved 
statistical estimate of recreation use on the national forests.

                           forest management

    Senator Craig. Mr. Chairman, just one last item, and it is 
merely a comment because of the discussion that has gone on 
this morning amongst a good many of our members of this 
committee. I, as you know, chair another committee that is 
directly involved, at least from the authorizing point of view 
with the Forest Service. And I have been working on a major 
piece of legislation.
    Mr. Chairman, I say this for the value of the committee, 
because I thought it was a valuable statement made at the last 
workshop I held out West on forest management and why we may be 
in such conflict today in so many of our areas of management on 
the forests.
    The policy under which you are managing today by law is 
largely directing at a multiple use approach toward management. 
But there is no doubt that it appears that the Forest Service 
is moving toward management by biodiversity and not by multiple 
use.
    And in that, if that is true, and I believe it is based on 
the research we have done, then we are in for more conflict 
because you cannot get to where you need to get from a 
biodiversity point of view if the law suggests that you do it 
through multiple use. And, therefore, we look at it through the 
eyes and the glasses of multiple use.
    Now, I am not saying that critically. I am just simply 
saying that as a point of observation. Maybe we ought to 
change. And if we change, we change a variety of the indices 
that drive not only budgets, but thinking.
    And how we get there, I am not sure, but it is one of the 
areas that I am going to look at it as we deal with legislation 
to revise or amend some of the management processes of the 
Forest Services. My guess is it will change the--the Forest 
Service is caught in that juxtapose right now as it relates to 
whether it is management for multiple use or management by 
biodiversity.
    And one is not necessarily compatible with the other in 
many instances, or the changes significant enough to move us 
from multiple to biodiversity clearly impact a variety of user 
constituencies on the ground.
    Mr. Chairman, thank you very much.

                             fire equipment

    Senator Gorton [presiding]. Thank you.
    For both of you, Bruce Evans has handed me a letter written 
to me about 10 days ago from two disabled veterans in 
California, who have serious problems with respect to their 
agreements for the rental of emergency fire equipment in which 
they think they have been discriminated against.
    Senator Domenici has brought this letter to my attention. 
Copies of it went to every member of the subcommittee, as I see 
it here.
    I am going to submit this letter to you and ask you whether 
or not you can promptly get us an answer so that we can respond 
to them.
    [The letters follow:]
                 Letter From John Ryan and Donald Walsh
                                                     April 7, 1997.
Hon. Slade Gorton,
Chairman, Interior Appropriations Subcommittee,
U.S. Senate, Washington, DC.
    Dear Mr. Gorton and Subcommittee Members: We are both Disabled 
Veterans who are in the wild land fire fighting business, providing 
fire-ready bulldozers and water trucks to federal, state and local 
agencies for wild land fire suppression work. For many years, we have 
entered into written emergency fire equipment rental agreements (EERAs) 
with the USDA Forest Service. These agreements must be renewed every 
three years, most recently in 1996. During the 1996 EERA renewal 
process, Don Walsh raised the issue of 41 CFR Chapter 60, Section 250 
which provides that Disabled Veterans specifically benefit during 
hiring. What resulted was an attempt by Forest Service contracting 
personnel to refuse to renew Don Walsh's EERA.
    There were numerous large wildfires in California's national 
forests in 1996. John Ryan was not hired at any of those fires, Don 
Walsh was hired at only one. During said fires, we contacted the 
contracting people at each forest involved as well as personnel at 
Pacific Southwest Region headquarters in San Francisco. Unfortunately, 
the Forest Service personnel we contacted did not choose to acknowledge 
that Disabled Veterans are entitled to the same preferences in hiring 
which they bestow on other groups and individuals.
    In August 1996, we contacted Allen Amaro, Legislative 
Representative for the Disabled American Veterans (DAV), Department of 
California. After numerous contacts with Forest Service's Pacific 
Southwest Region office, Mr. Amaro arranged a meeting which was held on 
March 5, 1997 at the California Department of Veterans Affairs offices 
in Sacramento. In attendance were Douglas Lee, Assistant Regional 
Forester and David Allasia, Contracting Officer, both from Forest 
Service's Pacific Southwest Region, Tom Langley from California 
Department of Veterans Affairs, Allen Amaro from DAV, John Ryan, Don 
Walsh and Warren Walsh.
    At said meeting we asked Douglas Lee if the Disabled Veterans 
hiring issue could be resolved prior to the Interior Appropriations 
Subcommittee hearing on April 17, 1997. Mr. Lee stated that was 
unlikely and we should proceed with this course of action. He later 
confirmed this in a letter dated March 10, 1997. This is why we believe 
we had no choice but to bring this issue to the Interior Appropriations 
Subcommittee.
    As Disabled Veterans of the Korean conflict, we have endured four 
decades of discrimination by employers, labor unions, health insurance 
companies and others. Now, we have to endure discrimination by Forest 
Service bureaucrats who would rather hire their ``good old buddies,'' 
some of whom are retired Forest Service personnel, during emergency 
equipment hires. We are not asking for welfare or a hand-out, we are 
only asking to benefit from the programs which were legislated by a 
grateful nation as indemnification for our sacrifices. No additional 
funds will be required to implement 41 CFR Chapter 60-250 during 
emergency equipment hires.
    We ask you to place control language in USDA Forest Service's 
budget which would require compliance with 41 CFR Chapter 60-250 for 
Disabled Veterans who are prequalified under an EERA during emergency 
equipment hires. If USDA Forest Service refuses to comply, we ask you 
to withhold a portion of their budget. We would be happy to provide 
further testimony to the Subcommittee or individual Subcommittee 
Members if necessary. We had hoped to appear personally to testify, but 
no formal outside witness hearing was allowed. Therefore, we request a 
copy of the minutes of the hearings, and any correspondence with USDA 
Forest Service on the issue.
    We thank you for your assistance in this matter.
            Sincerely,
                                   John Ryan,
                                  Water Trucks, So. Lake Tahoe, CA.
                                   Donald L. Walsh,
                                 Bulldozer Service, San Martin, CA.
                                 ______
                                 
                        Letter From Mike Dombeck
Re Fire Equipment.
                    U.S. Department of Agriculture,
                                            Forest Service,
                                       Washington, DC, May 9, 1997.
Hon. Slade Gorton,
Chairman, Subcommittee on Interior and Related Agencies, Committee on 
        Appropriations, U.S. Senate, Washington, DC.
    Dear Senator Gorton: This letter is in response to your inquiry 
concerning a matter raised by Mr. Donald Walsh and Mr. John Ryan, 
veterans of the Korean conflict. These individuals expressed concern 
about their not being provided preference in the ordering of equipment 
by the Forest Service in support of wildland fire suppression efforts.
    Mr. Walsh and Mr. Ryan referenced 41 CFR, Chapter 60, Section 250 
as the basis of their concern. That particular Federal Regulation 
pertains to preference to veterans for the purposes of hiring. The 
issue raised by the two gentlemen has to do with entitlement to 
preferential status when the Forest Service hires equipment under 
Emergency Equipment Rental Agreements in support of firefighting 
efforts.
    Mr. Walsh and Mr. Ryan raised this issue with our Regional Office, 
Procurement Staff in San Francisco, California, previously. In the 
response from that office, it was explained that 41 CFR, Chapter 60, 
Section 250 pertained to employment practices, not contracting actions. 
The response also explained that there is a provision in the Emergency 
Equipment Rental Agreement providing for preference in subcontracting 
with veterans. This provision is directed at the prime contractor, and 
encourages subcontracting with veterans.
    As explained in the Region's response, there are no statuary or 
regulatory requirements that preference be given to veterans in 
ordering equipment in support of our fire suppression efforts. Our 
policy on placing orders for equipment under the Emergency Equipment 
Rental Agreement is one of ordering the closest available resource 
meeting the requirements of the suppression effort. This policy is 
necessary in order to respond as quickly and efficiently as possible in 
efforts to protect life and property that is threatened in wildland 
fire situations.
    I have included a copy of the Regional Office's earlier response to 
Mr. Walsh and Mr. Ryan for your information. Thank you for your 
interest in this matter. If I can be of further assistance, please do 
not hesitate to contact me.
            Sincerely,
                                               Mike Dombeck, Chief.

                    remarks of senator patrick leahy

    Senator Gorton. With that, Senator Leahy, you know by the 
time at which this started that this hearing has gone on for 
quite a while. I had to miss quite a bit of it and have a 
fairly extensive series of additional questions. So at this 
point, I am going to defer to you and let you make whatever 
statement you would like and ask whatever questions that you 
have.
    Senator Leahy. I will be very brief because I am supposed 
to be also at two other committee hearings.
    It is good to have Mr. Dombeck here as the Chief of the 
U.S. Forest Service to guide our national forests into the next 
century. I have been a strong supporter and a great admirer of 
the traditions and the missions of the Forest Service.
    I have confidence that it has the statutory and 
administrative ability to maintain the balance between 
multiple-use and sustained yield management of our forests.
    I have respect for the knowledge and skills of the people 
who work for it.
    But I do have the concerns I have expressed before that as 
the Forest Service faces pressure to maintain timber 
production, expand recreational opportunities, we could 
compromise that debt that we owe to our children. The debt, of 
course, is to conserve those forests for their use and 
enjoyment.
    We feel some of the same pressures, Mr. Chairman, even by 
private landowners in the Northeast. The northern forest region 
has seen some of the similar changes to its social and economic 
structures as they have had in the Pacific Northwest, different 
types of forests, similar pressures.
    Thousands of people live in the region and how do they 
maintain their economies and provide the jobs and preserve the 
environment that makes that region such a special place? I 
initiated the Northern Forest Lands Council as a way of looking 
at this and last week introduced the Northern Forest 
Stewardship Act to implement the Council's recommendations. The 
act has strong bipartisan support throughout our region, 
because it lets the communities decide and gives them a great 
deal of discretion within the 26 million acre northern forest.
    Mr. Lyons has been to Vermont. He has seen this. He has 
discussed it with our Governor and with others throughout the 
Northeast. The bill embodies the conservation ethic of the 
1990's, nonregulatory incentives in support of community-based 
goals for sustainable economic and environmental prosperity. 
Mr. Lyons and the Forest Service has made a great effort to 
share the vision these communities have.
    So I look forward to working with you, Chief, to implement 
these solutions and welcome you to come on up to Vermont 
sometime, as your predecessors have. We can show you a 
beautiful area but also show you an interesting thing on the 
small communities dealing with big problems and doing it very 
well.

                  state and private forestry programs

    I have only one question. I will submit the rest for the 
record, if I might, Mr. Chairman.
    But Chief, I would ask you: With timber harvests on public 
lands declining, the pressure on private forest lands to 
provide more of the Nation's wood supply is increasing, not 
only in the northern forest but, my understanding is, across 
the country.
    Would you agree that more attention within the Forest 
Service should be focused on State and private forestry 
programs? And if so, how are we going to do that, either in 
expanding funding or programs?
    Mr. Dombeck. Yes; as a matter of fact, in the little over 3 
months I have been on the job I have spent a significant amount 
of time learning about the State and private program, because 
some 70 percent of our forests are in private ownership.
    I have had dialog with the State foresters. In fact, the 
president of the National Association of State Foresters is in 
essence a voting member of the management team of the Forest 
Service.
    From the standpoint of the State foresters, some of the 
monitoring technologies, the wide variety of stewardship 
programs, the Forest Legacy Programs, and so on, are programs 
that in spite of some of the unpopular things we have talked 
about this morning, that are very much in demand, very popular, 
and very important. These are programs that we need to bolster.
    Senator Leahy. The 1998 request reduces, among other 
things, the economic action programs. What happens to rural 
development through the forestry initiative under this? Does it 
disappear or do we get smacked up along side of the head and 
shoulders?
    Mr. Dombeck. Let me ask----
    Senator Leahy. That is a technical term.
    Mr. Dombeck. Yes; let me ask our Deputy Chief for State and 
Private Forestry to talk about some of those details.
    Ms. Comanor. Senator Leahy, you have long been a supporter 
of State and private forestry programs, and I and my staff 
appreciate that very much.
    As we looked at the options we had within a constrained 
budget, we were successful in maintaining the overall funding 
for State and private comparable to the 1997 appropriation.
    What we did is look hard at legacy and have proposed an 
increase in the Forest Legacy Program. It is a successful tool 
to use to deal with many of the issues in your part of the 
country and most recently in Senator Gorton's home State.
    We also looked at increasing, once again, the President's 
proposal for stewardships incentives funding to cost share with 
private landowners so they can make investments in their lands 
so we will have well managed forests into the future.
    So within those choices and the other commitments we had in 
the Northwest, the Economic Assistance Program took a little 
downturn, as you are observing. We would have a comparable 
spread within the Rural Assistance Program for those programs 
that we have been conducting proportionate to the available 
funds that we received.
    Senator Leahy. Does that mean they go up?
    Ms. Comanor. It depends on what the appropriation brings 
us. But we would continue a comparable spread among the 
different elements within the Rural Assistance Program 
proportion to what they have been, at whatever level of funding 
we receive.
    Senator Leahy. We will work with you on that as we go 
through the appropriation process. And I will be quite 
interested in it.
    Mr. Chairman, I will submit my other questions, if I might, 
for the record.

                          salvage sale program

    Senator Gorton. Fine. Thank you, Senator Leahy.
    I appreciate the patience of all of you here to all of the 
questions you have been asked and to my own unavoidable 
absence. A number of the questions that I would have dealt with 
have been submitted to you already by other members of the 
subcommittee, but I do have a number of additional ones.
    I would like to start by discussing the Timber Salvage 
Program. An important aspect of your Forest Health Program 
appears to be a proposal to split the timber salvage fund into 
two parts with the new fund being called the forest ecosystem 
restoration and maintenance fund. Am I correct in that 
assumption?
    Mr. Lyons. That is correct.
    Senator Gorton. Will the sale of timber be an important 
aspect of this new fund?
    Mr. Lyons. The fund is dedicated primarily, or is proposed 
to be dedicated--obviously we would need statutory authority--
to those other ecosystem restoration and maintenance activities 
that would help to support both improve forest health and 
timber supply, thinning, salvage, road obliteration, 
revegetation, et cetera.
    So the primary focus of forest ecosystem restoration and 
maintenance fund [FERM] would not be commercial timber 
production, but rather those other factors that frankly 
represent investments.
    Senator Gorton. So any timber sales would be incidental 
with respect to this fund.
    Mr. Lyons. I would say that, sir.
    Senator Gorton. OK. Under the present timber salvage fund, 
the timber offering target for fiscal year 1998 is 1.3 billion 
board feet. How would that number be stratified or divided 
between the two funds if this proposal were in existence today?
    Mr. Lyons. I am hesitating only because I think Mr. 
Satterfield knows how the actual breakdown would occur. But in 
essence, our program would remain essentially timber produced 
from the salvage program, as well as the component that is the 
green program. That would be where our commercial timber 
program would come from.
    And Mr. Satterfield just informed me that the split is 
volume neutral.
    Senator Gorton. So the overall target would remain 1.3 
billion board feet.
    Mr. Lyons. Yes, sir.
    Senator Gorton. Now let me specifically discuss the timber 
salvage rider as a part of the Rescission Act. On December 13 
of last year, Mr. Lyons, the agency issued direction to 
withhold all further advertisements of sales under the 
Rescissions Act.
    You stated at the time of that direction that the 4.1 
billion board feet sold as of November 30, and I quote, 
``represents 91 percent of the original commitment, well within 
the 25-percent range included in the correspondence between the 
administration and Congress.''
    It is clear that the agency committed to offering salvage 
volume in accordance with the Rescissions Act, but could well 
have exceeded the figure of 4.5 billion board feet in the 
amount of 25 percent. As a consequence, the statement is 
somewhat bothersome.
    Should this lead this subcommittee to assume in the future 
that any time we fund a program, a 91-percent accomplishment 
level is acceptable?
    Mr. Lyons. No, sir; you should expect 110-percent effort. 
And let me explain the rationale for the policy decision and 
direction that I provided.
    First of all, we knew that our bookkeeping was not quite up 
to date at that point in December. Our accomplishment reports 
indicated that we were doing better than was reflected by the 
numbers we had at that point in time.
    Our final report to the Congress from the salvage program 
indicated that we achieved 4.6 billion board feet of salvage 
volume under the salvage rider, in contrast to the 4.5 billion 
board foot target. So it was not 110 percent, but it was in 
excess of 100 percent.
    But we faced a difficulty which was the result of 
transitioning the program, the salvage program, back to the 
regular order of business on January 1. We had a number of 
sales in the pipeline that had been prepared under the salvage 
rider and then a number of other sales that we faced at the end 
of the year. And the questions coming back from the field were: 
How do we prepare to offer new sales on January 1?
    So we made a decision basically to finish everything that 
had already been prepared and was about to be offered, have it 
offered under the salvage program, but not at that point begin 
new offers.
    There was a third element to this, and I want to be clear 
about it. There was a great deal of concern, as you are well 
aware, among the public and others about the program. And we 
worked our way through this over time.
    But there was a perception. I do not think it was reality, 
but I think there was a perception that there was a rush to get 
sales out the door at the last minute under the salvage rider 
so as to dissuade the public of any perception that there was, 
as it was characterized by some critics, a Christmas sale 
underway to rush these things out the door.
    We said let us terminate things here, let us provide for an 
orderly transition, and let us get things done. I think by our 
estimates the impact in terms of volume, the additional volume 
that could have been offered in that period from December 13, 
or whatever it was, to the end of the year, was not 
significant. I think it was on the order of maybe 100 million 
feet would have been affected.
    And those sales are going to be offered under the regular 
program, or have been already.
    Senator Gorton. Now that you are looking back on most of 
that, have the sales of the other activities under the salvage 
amendment reduced fuel loads and reduced your expected 
suppression costs?
    Mr. Lyons. We have a great deal more work to do, Mr. 
Chairman. Chief Dombeck spoke to what our needs are as opposed 
to the resources we have to deal with them.
    So I would say in those places where we were able to 
implement sales in a strategic way, certainly it helped. But 
there is a still great deal more work to be done.
    Senator Gorton. Oh, I am certain that that is true. So 
future salvage sales will be directed, at least in part, to 
those same ends.
    Mr. Lyons. Yes, sir.

                        columbia basin ecosystem

    Senator Gorton. Now I would like to ask some questions that 
I hope do not duplicate what Senator Craig did with respect to 
the BLM East Side Columbia Basin Ecosystem Management Project.
    In this project you cooperated, obviously, with BLM to 
combine up to 74 land and resource management plans for 45 
units. I gather your draft environmental impact statement are 
scheduled for imminent release sometime this spring?
    Fish and Wildlife and National Marine Fisheries Service are 
also a part of it, but those two agencies have specific 
missions that do not reflect any target such as timber 
production.
    Mr. Dombeck, this question is for you. Have the differing 
missions of the Fish and Wildlife Service and the National 
Marine Fisheries Service affected the planning effort, 
specifically the commodity targets which the Forest Service and 
BLM, to the extent that you know about BLM, may produce?
    Mr. Dombeck. From the standpoint of the specific effects in 
numbers, I cannot give you that specific information here and 
now. But what I will say is that I think the important thing is 
we are working this up front.
    In the past, we have run into a gridlock in litigation and 
things like that. Hopefully that is behind us with the agencies 
working in parallel, and together on these issues up front.
    I have to say, and I am sure Jim will want to comment on 
this as well, some of the things we have learned, through 
better coordination and working up front, is from the 
consultation backlog in the Pacific Northwest where we had as 
many as 100 or more.
    Ms. McDougle. We had 1,700.
    Mr. Dombeck. A backlog of 1,700. That backlog has been 
eliminated. We are doing everything we can to push the agencies 
to work together in a more cost-effective manner. Our hope is 
that is what is being accomplished here.
    Senator Gorton. Probably you anticipate my next question, 
which is for one or both of you to put on the record what this 
project has to show for the $35 million of taxpayer money that 
has been spent on it and an estimate, if you can, of how much 
more will be spent before it is completed.
    Mr. Lyons. We will certainly have to provide you that for 
the record, Mr. Chairman. Let me, if I could, give a followup 
comment to what Chief Dombeck said.
    There was obviously a lot of criticism and concern about 
the salvage program and the salvage rider in particular. But 
one of the things we learned through that was, and I think one 
of our successes in achieving the goals that we set, was the 
coordination and collaboration among the land management 
agencies, Fish and Wildlife, NMFS, and EPA.
    We brought them altogether on the ground in what we call 
level one teams. And in fact the interagency report that 
evaluated the program highlighted that as the most effective 
and more efficient way of doing business so as to avoid 
backlogs and consultations, et cetera.
    What I hope the Columbia River Basin Program will do, we 
cannot measure just today. We are not done with that effort.
    What we hope it will do is provide greater certainty for 
the region as a whole in terms of an understanding of the goods 
and services that will be produced by the Forest Service and 
BLM management units there, as well as provide us greater 
scientific certainty so that when there are questions or 
challenges to particular management actions, we are able to 
fend off those challenges because we have a sounder foundation 
from which to work.
    Finally, our ultimate goal is to make sure the communities 
in that area have a clear understanding of what the future 
holds because they have been part of the process. They can in 
fact then determine where they want to make investments as 
communities as they grow and develop and deal with the economic 
challenges they face.
    [The information follows:]

          Interior Columbia Basin Ecosystem Management Project

    In fiscal years 1994 through 1997 (estimated) the Forest 
Service and the Bureau of Land Management will have spent a 
total of about $35 million on work associated with the Interior 
Columbia Basin Ecosystem Management Project (ICBEMP). In fiscal 
year 1998 about $5 million is needed to complete the Final 
Environmental Impact Statements (EIS) and Record(s) of Decision 
(ROD). Neither the FS nor the BLM included funds to begin 
ICBEMP implementation in the fiscal year 1998 President's 
Budget. Fiscal year 1999 would be the first year funds might be 
requested for implementation, but final decisions are not 
anticipated until the Summer (third fiscal year quarter) of 
fiscal year 1998, following public review of the Draft EIS's.
    Several benefits are associated with the ICBEMP. The Forest 
Service expects that decisions from the Project will streamline 
the Land and Resources Management Plan revision process for the 
affected National Forests. Broad scale social issues are being 
addressed in a consistent manner. Other broad scale issues such 
as forest health, range health, and fish and wildlife 
protection, transcend administrative boundaries and will be a 
primary focus of the decisions (based on the EIS's).
    Further benefits include: more effective analysis of 
cumulative effects of land management activities than when 
attempted unit-by-unit, reduced vulnerability to legal 
challenges because of increased consistency across the region 
of plans and management, and, more favorable regulatory agency 
consultations. If each administrative unit acted independently 
in addressing anadromous fish, for example, the FWS and NMFS 
might assume worst case conditions in adjacent areas because of 
a lack of overriding context or coordination of individual 
agency plans.
    In terms of ``products'', the ICBEMP has released a 
``Framework for Ecosystem Management'', ``Scientific Assessment 
for Ecosystem Management (on BLM/NFS lands) in the Interior 
Columbia River Basin'', ``Draft Eastside Environmental Impact 
Statement'', ``Draft Upper Columbia River Basin EIS'', and 
``Scientific Evaluation of Alternatives''.

                            law enforcement

    Senator Gorton. Another subject--and this, Mr. Lyons, is 
for you--last year in August, demonstrators were finally 
cleared from a timber protest area in the Willamette National 
Forest.
    I was informed that when law enforcement officers initiated 
action a month earlier to remove the demonstrators, the 
Secretary's office intervened and delayed the action.
    Why? And why was so much damage to Forest Service land 
allowed to take place without law enforcement action occurring?
    Mr. Lyons. Mr. Chairman, I cannot speak to the extent of 
damage that occurred. I think it was rather restricted. There 
was concern on the part of the Secretary's office as to 
ensuring the health and safety of Forest Service employees, as 
well as to ensure that the protesters were handled in an 
appropriate manner.
    I think some time was spent trying to ensure that law 
enforcement, local law enforcement, and State officials were in 
agreement about how to proceed with those actions. Ultimately 
those protesters were removed from the site. And in fact this 
year, anticipating protests on the Willamette and other places, 
I have had some conversations with Forest Supervisor Kenops 
about that potential.
    We intend to sit down early with the FBI and with State 
officials to make sure we are prepared in advance to handle 
this.
    Senator Gorton. You certainly did anticipate my followup on 
that. Do you think you will be able to deal better with any 
demonstrations of that sort this year as a result of your 
experience last year?
    Mr. Lyons. I believe so. There is renewed confidence within 
the administration and certainly with the Forest Service's 
handling of the situations last year that the incident command 
teams can move forward and deal with this aggressively.
    Senator Gorton. Good. I am very pleased to hear that. I 
hope it works out on the ground.
    Mr. Lyons. We hope so, too.

                          timber sale targets

    Senator Gorton. Your current timber sale target for the 
country is just under 4.2 billion board feet. Mr. Dombeck, will 
you reach that goal? And specifically in a parochial fashion, 
will you reach the 1 billion board foot goal from the Pacific 
Northwest?
    Mr. Dombeck. Yes.
    Senator Gorton. That is a wonderful answer. You do not need 
to add to it.
    During the fiscal year 1997 hearings, Mr. Lyons and then 
Chief Thomas stated that there were insufficient resources to 
accomplish a complete substitution of volume for the section 
318 sales and to meet the requirements of the President's 
Northwest plan.
    The committee understands that additional resources were to 
be provided to the agency's Pacific Northwest region to bring 
timber sales forward in the pipeline to accomplish both the 
substitution and the requirements of the President's plan. Have 
those resources been so allocated?
    Mr. Lyons. Yes, sir; they have. All parties to the 
settlement agreement are pleased with where things stand and 
the progress that is being made.
    Senator Gorton. So in fiscal year 1998 you are confident 
that we will be able to meet those goals.
    Mr. Lyons. Yes, sir.
    Senator Gorton. OK. The administration entered into a 
settlement agreement with a number of the purchasers to buy out 
their old timber sales contracts. Can you tell me what the 
total cost of these agreements is and how you are going pay for 
them?
    Mr. Dombeck. Let me ask Steve to correct me if I am wrong, 
but as I recall, what we know now is about $21 million. And I 
might ask Steve to elaborate on where he is going to find the 
money since he is the keeper of the books.
    Senator Gorton. Yes; we are quite interested in that.
    Mr. Satterfield. I am kind of interested in where I am 
going to find the money, too. Well, there are two pieces. Of 
course there is the Ketchican one where the Department of 
Agriculture general counsel has written a letter to the 
Treasury making the argument that we should not be required to 
reimburse the judgment fund. So that would be up to Treasury to 
get reimbursed, if that was the case.
    The remainder, the $20 million, we have not resolved yet. 
We obviously do not have any direct appropriations for that. In 
the end, if we have to reimburse the judgment fund from where 
those claims are being paid initially, then we will just have 
to take it out of every other National Forest System program.
    Senator Gorton. Jim, in this connection, that is a very 
good answer. That is a fair amount of money, and you do not 
have it just in pocket change.
    We are only talking about 7,000 acres of sales in Oregon 
and Washington combined. It was your view that the sales would 
have jeopardized the balance in the President's Northwest 
forest plan.
    Can you explain in lay terms why 7,000 acres, either these 
or exchanged acres, out of 24 million acres out there could 
really have been significant and required that being bought 
out, rather than exchanged for an equivalent harvest elsewhere?
    Mr. Lyons. Well, let me say at the outset, Mr. Chairman, 
that our preference is to find alternative volume. And we have 
had some circumstances where we have been able to succeed in 
doing that, as you know.
    Senator Gorton. Yes; I do understand that.
    Mr. Lyons. As to why 7,000 acres should be so significant, 
it is not a judgment I can render except to say that we asked 
both the regional ecosystem office, as well as the keepers of 
the plan, who are the regional executives, to look at these 
issues.
    Certainly where there are endangered species impacts, that 
is a concern. Where there could be impacts on aquatic 
resources, which has been the case with some of these sales, 
that has been a concern.
    Our overall concern is the cumulative effect of these 
sales, maybe 7,000 acres today, maybe adding up to more 
tomorrow, could have a detrimental effect on the plan overall. 
The plan strikes a careful balance, although you and I have had 
many discussions about whether or not that is an appropriate 
balance.
    We are doing our best to ensure that we stick with the 
concepts and the proposals incorporated in that plan. And I 
think at least a benefit to this point in time is our ability 
to fend off legal challenge and proceed to harvest timber in 
the matrix as proposed, to begin work in the adaptive 
management areas and to expand our opportunities there, and 
also to make the watershed improvements and in fact develop 
operations in the late successional reserves in accordance with 
the prescriptions and guidelines included in the plan.
    Senator Gorton. And it is worth $20 million even if you 
have to scramble for it out of other appropriations?
    Mr. Lyons. Well, Mr. Chairman, I understand your point. 
Here is my concern, though. If in fact harvesting those units 
cause some harm to the plan or ran the risk of the plan being 
challenged, I dare say the cost to the region would be far in 
excess of $20 million. And that is the judgment we have to 
make.

                        western director office

    Senator Gorton. Now, Jim, I have another subject. It is a 
small one, but it has gone on and on and on. In the fiscal year 
1996 appropriations bill, the Department was directed to 
eliminate the Office of Forestry and Economic Development in 
Portland. This was done in response by the administration by 
renaming it the Office of Forestry and Economic Assistance.
    In the current appropriations bill, the Department was 
directed to eliminate this office, and we withheld funding for 
any successor office. Leon Panetta agreed to this on behalf of 
the President.
    Now we are informed that the Secretary has directed the 
establishment of an office to house the Western Director for 
the Office of the Secretary. Lo and behold, we have the same 
person in all three of these offices, who remains in Portland.
    Some 50 percent of the office's funding is to come from the 
Forest Service subject to a reprogramming request that I 
understand will soon be submitted. How can you explain this as 
anything other than a direct defiance of the expressed will of 
Congress?
    Obviously it is a successor office. What do we have to do 
if we do not want that office to be there?
    Mr. Lyons. Mr. Chairman, the Secretary created this Western 
Director position because of the high number of controversial 
issues affecting the Department and the Forest Service in the 
Pacific Northwest.
    Tom Tuckman, who you were referring to, has served in 
various capacities out there, is a very able and talented 
individual. And I know you know him personally.
    His responsibilities have changed over time. For example, 
Tom right now is involved in the headwaters exchange and is 
involved in working on the Tahoe basin event, which Senator 
Reid alluded to earlier in the day. He is also involved in 
ensuring that we meet our goals and commitments in accordance 
with the President's forest plan but reports directly to the 
chief of staff for the Secretary.
    I believe the Secretary's intent is to make sure that we 
can be as responsive as possible to the needs of the Congress 
and in particular the members of the Pacific Northwest and 
feels that it is important to have that presence there so as to 
ensure that we are fulfilling the direction that we receive.
    Senator Gorton. From my perspective, Jim, this is much less 
about an individual than it is about whether or not the 
instructions of Congress are going to be followed. You are 
sitting there without a smile on your face telling me that this 
is not a successor office and not just a way around what 
Congress for 2 straight years has ordered you to do?
    Mr. Lyons. I am trying to give you the best answer I can, 
Senator.
    Senator Gorton. If it is really so important to the 
Secretary, why does he not pay for it through the agricultural 
appropriation?
    Mr. Lyons. I cannot answer that question, sir.
    Senator Gorton. Well, do not be surprised to see another 
order with respect to that office.

                             flood funding

    Mr. Dombeck, as you know, the administration has proposed 
that $38 million be appropriated to the Forest Service for 
construction and restoration projects in the supplemental due 
to recent severe flooding in the Pacific Northwest and Midwest.
    You asked for more than twice that amount, as I remember. 
What is that impact going to be? How are you going to set 
priorities? What very important things are going to end up 
undone?
    Mr. Dombeck. Well, first of all, I believe the House mark 
on that was $69 million?
    I believe the assessment that we made was about $80 
million. And from the standpoint of what things are not going 
to be done----
    Senator Gorton. Well, if you get that $69 million, are you 
going to be able to do essentially everything you need to do?
    Mr. Dombeck. Well, what we will do is take a look at the 
entire package of things that need to be done. I am told that 
we still may not have a complete assessment because of access 
and snow and that sort of thing. But we will start with the 
highest priorities first, you know, the areas most in need of 
repair and work our way.
    Senator Gorton. Have you given us a priority list so that 
we can understand on our part over here what gets cut off at 
any given level of appropriation?
    Mr. Dombeck. Let me ask Steve if a specific project list 
has been submitted. Not to my knowledge.
    Mr. Satterfield. The problem we have, Senator, is that 
these are very approximate estimates on part of the field. They 
cannot get into a lot of the areas. Region 1 in particular is 
under snow.
    So based on general experience with these kinds of things 
and what they can observe, they have made estimates. They have 
not had a chance to really sort out if they get $69 million, 
just which individual projects will not be done. But as the 
Chief said, they will work that through as carefully as they 
can.
    Mr. Dombeck. Janice apparently----
    Senator Gorton. So you are guesstimating and we are 
guesstimating, to use Senator Craig's word?
    Mr. Satterfield. In this situation, yes. I think Janice 
might have some more information.
    Senator Gorton. Good.
    Ms. McDougle. One of the things that we are working on 
right now, Mr. Chairman, is a partnership with our sister 
agency, NRCS, to look at opportunities to jointly review 
projects associated with flooding impacts.
    What we have discovered is that the Forest Service has 
authorities to do things on National Forest System lands. The 
NRCS has authorities to do improvements and restoration efforts 
on private lands downstream.
    And what we hope is that collectively we will come up with 
priorities for work that make sense for us to do together so 
that one does not cancel out the others.
    We are working on that right now. And it is an opportunity 
to leverage dollars as well.
    Senator Gorton. Thank you. Thank you very much.
    Any help you can give us between now and the time that the 
supplemental comes up on this will both add to our knowledge 
and I think to our ability to help you. We recognize that these 
losses did take place, and we want to allow you to get to work 
on them as soon as possible.
    Mr. Lyons. Thank you.

                       issues in washington state

    Senator Gorton. I have a few parochial questions with 
respect to the State of Washington now, if I may submit them to 
you. I understand that region 6 has asked for $500,000 from 
headquarters accounts to process the land exchange with Plum 
Creek in the Wenatchee National Forest. Funding for this 
project will be used for technical and environmental work that 
must be completed during the course of this fiscal year.
    What is the status of that request?
    Mr. Lyons. I will ask Steve to give us the exact numbers. 
What I understand, as I checked into that before I visited you 
on Monday, is that this is a priority, and is something that we 
are proceeding with as best we can with the resources we have.
    What is the exact disposition of that money, Steve?
    Mr. Satterfield. I think that is to be determined, too. 
What we have is a lot of requests from around the country with 
considerable urgency. And what we are trying to do right now is 
to balance those. What we would propose and what we would have 
to offset. And in some of these cases, I am not sure, I think 
this one--many of them will require reprogramming.
    So we are in the process of working that through right now.
    Mr. Lyons. Let me assure you, though, Mr. Chairman, that 
this remains a priority for the administration and a tremendous 
opportunity, I think.
    Senator Gorton. It is a high priority for me. The idea of 
the kind of blocking up that you are doing there is, I think, 
progressive, something that is entirely win-win. And I do want 
to advise on you the interest this chairman has in that 
subject.
    One more; 15 years ago, the Congress authorized the Mount 
Saint Helens National Volcanic Monument. The exchange of 
surface and minerals with private landowners was to be 
completed within 1 year after the act was signed into law. 
Approximately 10,000 acres of private mineral rights, however, 
remains stranded in the monument area.
    I understand that the companies involved, Weyerhaeuser and 
Burlington Resources, are working with the Forest Service and 
the BLM to resolve the situation. I am really planning to 
introduce legislation to address the issue and wonder if you 
could give me a progress report.
    What is going on? What kind of additional authority might 
you need? When are we going to get it done?
    Mr. Lyons. I do not see any heads nodding here of people 
that are real familiar with the issue. I know that I am not. 
But what we will do is we will provide a detailed answer to 
that for the record.
    [The information follows:]

                   Mount Saint Helens Mineral Rights

    The proposal: Approximately 10,750 acres of mineral estate 
within the Mount Saint Helens National Volcanic Monument remain 
in Burlington Resources and Weyerhaeuser ownership. The 
proposal by the companies is to pursue legislation with the 
idea to make it simple, to incorporate full consultation from 
all parties, minimize surface administration and costs, provide 
solutions for acquisition, and establish time frames for 
completion. The new legislation would amend the existing Act by 
directing the Secretary of the Interior to complete the 
exchange by using ``bidding scrip'' in lieu of Federal land or 
minerals.
    The ``bidding scrip'' concept would grant a dollar for 
dollar basis to compensate the company for valuation of their 
mineral estate in the Monument. It could be used as credits 
towards bidding rights, royalties, and/or bonus payments. 
Credits would be administered by USDI and subject to existing 
laws and regulations.
    What is the current status of negotiations between the 
Companies and Agencies?
    On April 22, Burlington Resources, Weyerhaeuser, Forest 
Service and Bureau of Land Management met to review the 
proposal and to discuss areas of agreement and areas of 
concern. The concept of using ``bidding scrip'' as compensation 
appears to be a viable alternative to complete the 
congressionally mandated exchange. The primary concern of the 
BLM and FS is reaching agreement on the value of the severed 
mineral estate (particularly the geothermal resource). 
Burlington and Weyerhaeuser agreed to do a thorough search for 
additional valuation data and geothermal sales. All parties are 
currently collecting and reviewing the additional valuation 
data. The valuation negotiations will continue on May 28.

                           national monument

    Senator Gorton. All right. Again, after 15 years and my own 
interest as the primary sponsor of creating that national 
monument in the first place and trying to work out these 
private and public interests, I would be very gratified to see 
the work completed.
    And the more we feel there is real cooperation between the 
Forest Service and the Congress, the better we are going to be 
able to help you.
    That is why things like the Tuckman office come up, Jim. I 
will just be very blunt with you. I do not know how it could be 
worth it to you to keep that aggravation going with the 
Congress that has made the kind of decisions on it that it has.
    You know, there are obviously going to be some major policy 
differences, and we understand those differences. But we should 
have as close and cooperative a working arrangement with one 
another as it is possible to create.
    I do want to give you one last expression of concern. On 
December 11 of last year, Senator Byrd and I, Chairman Regula 
and Mr. Yates wrote to the secretary. While I will not go into 
the detail about the actions that prompted that letter, I want 
to let you know that I remain concerned about the relationship, 
as I have just said, between the subcommittee and the 
Department.
    We really have got to be able to count on the Department to 
adhere to well-established practices and procedures, the most 
important of which are reprogramming guidelines. The only 
alternative we have is to write a lot of the things that we do 
less formally into the law as we create an appropriation.
    I do not want to do that. That is frustrating, and it is 
not particularly flexible. If we can get the kind of 
cooperation I have been talking about, which is obviously the 
intent of Congress, it is a much, much better way in which to 
work.
    I do want to say thank you to both of you and to your 
associates, some of whom are to be congratulated on new 
positions. Dave, I also will join in thanks for your many years 
of service. And I am quite sure you are not just going to go to 
seed. You are going to find something else to do that will be 
interesting and will use the knowledge that you have gained.
    Mr. Unger. I trust that will be the case, Senator.
    Senator Gorton. And I wish for you great success in that as 
well. Your responses here today have been thoughtful and 
reasonably complete. Let us keep going on that, and let us get 
rid of some of these differences and exacerbations that really 
do not need to exist and that end up frustrating both sides of 
this table.
    Mr. Dombeck. Senator, if I might, I would just like to 
respond and say that in my 3\1/2\ months in this job that you 
have articulated the spirit in which I want to work.
    And that I realize the issues of national forest management 
and resource management in general for all agencies in a 
changing society can be very tenacious. But yet there are many, 
many positive areas that I hope that we can focus on together 
to move forward and build relationships. As we do that, I 
believe that some of the more tenacious issues will become 
easier to deal with.
    I look forward to a long positive working relationship with 
you and your staff as all of the members of the committee.
    Senator Gorton. Very good. Jim, I will see you on the 
trail.
    Mr. Lyons. I look forward to that, Senator. And I just want 
to second what Mike said and indicate that I have appreciated 
your help in working through some very difficult issues.
    We have had our differences over time, but I have always 
appreciated your open door and the opportunity to sit down and 
discuss differences of philosophy and work together most 
importantly to protect the resources of the United States, 
which I know you care dearly for as well.

                     Additional committee questions

    Senator Gorton. Thank you very much. I have a large number 
of other questions of significance, but perhaps it is not the 
best use of the time of all of the people in this room to go 
through them orally here. We will submit them to you, together 
with Senator Leahy's questions and those of any other members 
who have questions in writing.
    I would urge you to answer them as promptly and completely 
as you can. I simply have to return to my earlier remarks. Like 
the last few years, this is likely to be a tough year.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing:]
                     Additional Committee Questions
                       state and private forestry
Suppression of insects and diseases
    Suppression of insects and diseases on Federal and tribal lands is 
an important part of Forest Health management.
    Question. Are there significant insect and disease suppression 
efforts which may not occur under the President's budget? If so, please 
explain?
    Answer. Specific pest outbreaks are difficult to forecast this far 
in advance. Pest like southern pine beetle and gypsy moth can increase 
suddenly with little warning. If increases occur in several pests 
simultaneously, it is conceivable that significant insect and disease 
suppression efforts may not occur under the President's budget.
    Question. Is the suppression program being affected adversely by 
the appeals process in a manner similar to the effect on the timber 
program? Are cooperative efforts with states hampered by the appeals 
process?
    Answer. The insect and disease suppression program on Federal, 
state or private lands is not being hampered by the appeals process.
    Question. The Department of the Interior has raised significant 
concern regarding the spread of the Brown Tree Snake across the South 
Pacific and potentially into the Pacific Southwest states. In terms of 
non-indigenous pests and diseases, is forest health potentially 
affected by such ``Brown Tree Snakes?''
    Answer. The brown tree snake is mildly poisonous to humans, grows 
up to 8 feet in length, and would adversely affect recreational uses of 
forests and parks. Its primary negative effect would be on bird 
populations and biodiversity; nine native bird species have gone 
extinct on Guam following the snake's introduction. The loss of native 
biodiversity is a forest health concern.
                       forest stewardship program
    The President's budget proposes a level Forest Stewardship Program 
and increase in the Stewardship Incentive Program of $5.7 million which 
doubles it size.
    Question. To what degree has the Forest Stewardship Program 
enhanced the long term sustainability of timber production from private 
lands.
    Answer. The Forest Stewardship Program has enhanced the long term 
sustainability of timber production in the following ways:
    The owners of nonindustrial private forest lands that are enrolled 
in the program and have an approved forest stewardship plan agree to 
implement approved activities for a period of not less than 10 years.
    The Stewardship budget line item provides $2,805,000 for seedlings, 
nursery, and tree improvement. Without the low costs of genetically 
improved forest planting stock, many stewardship owners would not be 
encouraged to plant trees.
    Because, forester assisted timber sales provide double the income 
from unassisted sales twice the number of trees are left in the stand. 
This improves the long term sustainability of timber production and 
significantly enhances wildlife habitat. The Forest Stewardship Program 
through its collaborative stewardship approach contributed over $6 
million dollars to the income of consultant foresters through the 
landowners and has encouraged the start up of many new consulting 
businesses which tend to increase professional non-government technical 
assistance available to nonindustrial private forest land owners.
    The Forest Stewardship program, not only enhances the long-term 
productivity of timber, but encourages the long-term stewardship of 
nonindustrial private forest lands by assisting owners of such lands to 
more actively manage and enhance fish and wildlife habitat, water 
quality, wetlands, recreational resources, and the aesthetic value of 
forest lands.
    Question. Approximately 50 percent of all sawlog volume exists on 
the National Forests. With the timber program declining, what specific 
actions will enable increased production from nonindustrial private 
lands?
    Answer. In recent decades technical assistance and financial 
incentives (cost sharing) provided by Federal Government forestry 
programs, such as the Forestry Incentive Program (FIP), the 
Environmental Quality Incentives Program (EQUIP); formerly the 
Agricultural Conservation Program (ACP), and the Stewardship Incentive 
Program (SIP) have accounted for between one-third and one-half of all 
tree planting on nonindustrial private forest lands.
    Through State and Private Forestry programs professional assistance 
is made available to nonindustrial private forestland owners to 
implement Best (forestry) Management Practices to help landowners 
achieve their resource management objectives while maintaining or 
improving the quality of the Nation's environment and supply forest 
products.
    We are increasingly focusing on working with private landowners to 
develop Forest Stewardship Plans.
    The President's budget maintains, at the fiscal year 1997 level, 
funding for technical and financial assistance to nonindustrial private 
forest landowners to develop long-term Forest Stewardship Plans to 
guide the management of their forests and related resources. The 
President's budget significantly increases the level of financial 
assistance available to nonindustrial private forest landowners to 
implement multi-resource forest management practices, including 
reforestation and forest improvement practices.
    Questions. (a) What was the state by state breakdown of funds 
provided under the Stewardship Incentive Program for fiscal year 1995-
97? (b) What is the planned aggregation of fiscal year 1998 funds? (c) 
Based on projections, what are the long term effects on future timber 
production from this program which are attributable to the increase in 
requested funding? [d] How many additional landowners will benefit from 
the proposed increased funding level?
    Answers. (a) Refer to attached data tables that show the fiscal 
year 1995-97 breakdown. (b) The planned allocation of fiscal year 1998 
funds will include: (1) a base funding level based on the number of 
States in each Forest Service Region and the Northeastern Area, and (2) 
a distribution based on the number of nonindustrial private forest land 
owners and acres in each state. (c) The Stewardship Incentive Program 
(SIP) has nine approved practices of which several are very critical 
for future timber production. The first practice (SIP-1) is Management 
Plan Development which provides cost share incentive to landowners to 
develop a management plan for their forest land. This is important 
because it educates landowners about the need to harvest timber along 
with the management of other resources on their land. Over one-third of 
Stewardship landowners have stated that if it had not been for the 
broad based appeal of the overall Forest Stewardship Program, they 
would not have harvested timber. The second practice (SIP-2) 
Reforestation and Afforestation and the third practice (SIP-3) Forest 
and Agroforest Improvement are both critical to future timber 
production and directly result in increased timber volume. The tree 
planting practice will help insure a continuous supply of forest 
products and the forest improvement practice will help insure forest 
stands are growing quality timber and fully utilizing the site.
    The proposed SIP budget will allow the Forest Service to fulfill 
part of the larger demand for cost-sharing assistance to implement 
multi-resource practices on nonindustrial private forest (NIPF) lands. 
Multi-resource practices will be implemented on over 277,850 acres of 
NIPF lands, including 26,700 acres of tree planting and 26,865 acres of 
timber stand improvement practices. Sixty percent of the funding will 
go for tree planting and forest stand improvement which contribute to 
long term timber productivity on NIPF lands. [d] Approximately 3,900 
additional landowners will benefit from the increased funding level.
    Question. The Administration is placing significant emphasis on 
Forest Health. How will this emphasis translate to program emphasis in 
fiscal year 1998 versus emphasis 5 years ago? In otherwords, specific 
programs and funding levels existed 5 years ago as compared to the 
fiscal year 1998 budget proposal, for those significant Forest Health 
programs?
    Answer. In the past, pest prevention and suppression activities 
have been the primary focus of our Forest Health Management program. 
Today, we have a broader focus for forest health programs. In fiscal 
year 1998, we will continue to emphasize our surveys and technical 
assistances, including the Forest Health Monitoring program. A high 
priority will be to have better information on forest health problems 
and influence implementation of resource management decisions that will 
restore the health of the nation's forests, emphasize prevention and 
reduce suppression needs in the long run. Our past success in 
eliminating frequent low-intensity wildfires has led to conditions of 
dense accumulation of underbrush and over-crowded stands. These 
conditions render forests highly susceptible to large damaging fires, 
insects, and diseases. We intend to substantially increase fuels 
management and thinning in these areas.
    Question. The American Forest and Paper Association states that 59 
percent of timberland is in private ownership (not including timber 
industry ownership). What statistics are available to identify how the 
Stewardship Incentive program improved productivity from these lands?
    Answer. Timber harvesting without adequate consideration for 
regeneration is the single greatest threat to productivity on 
nonindustrial private forest (NIPF) ownerships. The Stewardship 
Incentive program increases the participation of nonindustrial private 
forestry land owners in reforestation, afforestation, and preharvest 
planning. It helps them do forest stand improvement activities, which 
includes: thinning; weed control; the use of prescribed fire; hazardous 
fuel reduction; insect and disease protection; and stand regeneration.
    The landowners activity under SIP also helps protect watersheds, 
water quality, forest health, aesthetics, and helps meet short and 
long-term national demands for wood products in a sustainable manner.
                         forest legacy program
    The Forest Legacy Program is proposed for a $4 million increase, 
which is double the fiscal year 1997 amount.
    Question. How will passage of the 1996 Farm Bill directly affect 
this program? Will there be a significant amount of easements or 
purchases which will be vested in State or local governments? Is the 
requested increase solely attributable to passage of the 1996 Farm 
Bill, or are there other initiatives planned for this increase?
    Answer. The passage of the 1996 Farm Bill greatly increased the 
flexibility of the Forest Legacy Program and strengthened the 
partnerships that are essential to its effectiveness. Many States are 
using the 1996 Farm Bill authority to take over and complete 
acquisitions begun by the Forest Service. It appears that most future 
projects will be done under State acquisition authority with the 
assistance of a federal Forest Legacy grant. Prior to the 1996 Farm 
Bill passage there was demand for funding in excess of what was 
available, and this remains true today. There are no other initiatives 
planned for this increase in funding. The funds will be used to 
complete identified projects, most often using the State grant option 
available under the 1996 Farm Bill.
                     forest and rangeland research
    The agency's budget proposal for this program remains at the 
approximate funding level received in the past two years.
    Question. What significant research activities will be forgone as a 
result of this budget proposal?
    Answer. The Forest Service Research program is leveling out from 
the turmoil resulting from the fiscal year 1996 reduction. We have been 
able to maintain the highest priority research needs to address the 
Nation's natural resources.
    Question. How have the priorities for the research budget changed 
from that proposed in Fiscal 1997?
    Answer. The Forest Service remains committed to maintaining a 
strong research base capable of addressing the Nation's many competing 
priorities. Because most of our research is long-term, making 
significant changes in our priorities in 1 year is difficult.
    Question. Approximately 15 percent of Research funds are utilized 
for Grants and Agreements. How has this percentage changed over the 
past 5 years? What are the priority emphasis themes for projects being 
financed through grants?
    Answer. Our extramural research funding levels are determined by 
two major factors, the work needed to accomplish our mission in a given 
year and the level of funds available for that year. Over the past 5 
years our extramural research level has decreased.
    Even with an overall reduction in the extramural program, records 
from the Current Research Information System (CRIS) indicate that while 
less research is being conducted in field of biological science (54 
percent in fiscal year 1992 vs. 49 percent in fiscal year 1996) there 
is a corresponding increase in the field of environmental biology (27 
percent in fiscal year 1992 vs. 31 percent in fiscal year 1996) and a 
slight increase in sociology (1 percent in fiscal year 1992 vs. 3 
percent in fiscal year 1996).
    Question. The forest inventory program currently operates on a 10-
12 cycle. What would the cost be to the program of conducting the 
inventory on a 5-year cycle? An 8-year cycle?
    Answer. The current Forest Inventory and Analysis (FIA) program is 
on a 12+ year national cycle with funding of $16 million dollars. The 
funding required to achieve a 5 year cycle is $38 million dollars. The 
funding required to achieve an 8 year cycle is $24 million dollars.
    Question. What has been the historic 5 year expenditure in each of 
the following programs: forest inventory; global climate change; and 
forest health monitoring.
    Answer. Figures for forest inventory (FIA), global climate change 
(GC), and forest health monitoring (FHM) are as follows:

                        [In millions of dollars]                        
------------------------------------------------------------------------
           Fiscal year                 FIA           GC          FHM    
------------------------------------------------------------------------
1993.............................         16.2         24.2          2.3
1994.............................         16.3         24.2          2.6
1995.............................         15.9         24.2          2.6
1996.............................         16.4         17.5          1.6
1997.............................         16.4         16.9          1.6
------------------------------------------------------------------------

    In addition, the Forest Health Monitoring (FHM) program receives 
support from other appropriations in the Forest Service as follows:

                        [In millions of dollars]                        
------------------------------------------------------------------------
                                                     Federal     Co-op  
                    Fiscal year                       lands      lands  
------------------------------------------------------------------------
1993..............................................  .........        0.6
1994..............................................        0.6         .7
1995..............................................        1.0         .7
1996..............................................         .5         .7
1997..............................................        1.2        3.2
------------------------------------------------------------------------

    Question. The development of remote sensing and satellite 
technologies have the potential to transform the Forest Inventory and 
Analysis data collection process. What plans are underway for the 
Forest Service to work collaboratively with the Department of Energy, 
National Aeronautic and Space Administration (NASA), and the National 
Oceanic and Atmospheric Administration (NOAA) in deploying and 
utilizing their technological advancement and applied research to 
forest inventory?
    Answer. FIA is currently pursuing many promising possibilities in 
the area of remote sensing. The Department of Agriculture is purchasing 
30 meter Thematic Mapper (TM) data sets for the 1970's, 80's, and 90's. 
This data can be used in the first phase of our inventories to estimate 
forest area. In several States we are working with the Fish and 
Wildlife Service GAP program. The GAP program is a program of the 
National Biological Survey to identify where gaps in habitat type 
exist. In Alaska, we are working with Earth Resources Observation 
Systems (EROS) data center to investigate opportunities for more 
efficient inventories. We are also reviewing techniques used in the 
NOAA Coast Watch program to evaluate cooperative opportunities. We have 
scientists at the Northeastern and Rocky Mountain Research Stations 
looking at ways to link our ground-based point data to remote sensing 
data to develop ground registered maps as a spatial analysis tool.
    Other promising opportunities include scheduled meetings with the 
Navy to assess aerial based Synthetic Aperture Radar and with NASA to 
look at Vegetation Canopy Lidar (low-power laser technology) to develop 
a 3-dimensional vegetation profile for estimating biomass.
    Question. The budget justification discusses the continued demand 
for wood fiber by referring to ``the residential building industry, 
which is dependent on forest products.'' In addition, the committee has 
received testimony relative to the need to increase utilization of 
metal and wood sites for construction purposes. To what degree is 
Forest Service Research involved in the development of alternative wood 
products research (plastic/wood composites, metal framing, etc.) which 
if developed could contribute to America's environmental health while 
stabilizing demand? What is the long term prognosis for the use of such 
products?
    Answer. Forest Service Research, through the Forest Products 
Laboratory in Madison, Wisconsin and other field laboratories, is 
contributing to improving America's environmental health through our 
recycling research program. Research is contributing significantly to 
mitigating increased demand for wood products by providing for reuse 
and recycling of wood and paper. We are developing new technologies, 
such as composites made from recycled wood and paper, in combination 
with plastics or inorganic compounds, to produce products that can be 
used in housing. Not only does recycling decrease use of raw wood 
products, but it also reduces the need for solid waste disposal space.
    The forest resource is changing. Many of the forests consist of 
dense, overstocked stands with smaller diameters and of mixed species 
and quality than traditionally used. Particularly in the West, many of 
these stands are at risk from insect and disease infestation and from 
intense wildfires. New ways of using this low-value timber to produce 
wood-based products for housing, such as composite panels and lumber, 
are also helping to defray the costs of ecosystem restoration. Some 
speciic examples include: (1) Evaluating the potential to use small 
diameter material for structural systems such as trusses, laminated 
veneer lumber, and oriented strand board; (2) Developing new methods of 
connecting smaller pieces of wood together to make larger dimension 
lumber; (3) Developing appropriately-scaled technologies for drying and 
processing this low-valued material in cost effective ways.
    Cost comparison of wood framing versus steel framing indicates that 
steel becomes competitive when lumber is generally above $500/mbf. 
Steel systems in residential construction have been boosted by the 
inclusion of light-gauge steel framing prescriptive standards in some 
codes. However, some analysis indicates that if increased insulation 
costs for steel framing is considered, steel studs may not be cost-
effective. Although some builders are moving to steel studs, others 
have switched back to wood when lumber prices fell below $500/mbf. The 
wood/plastic composites market is expected to be speciality products, 
instead of commodity products. We anticipate that wood/plastic 
composites will be used in housing applications primarily in doors and 
windows, interior molding and trim, on interiors and perhaps in siding 
and roofing. We estimate that wood/plastic composites will occupy about 
10 to 15 percent of this wood market by 2000. Other new composites for 
housing expected to make major advances are wood I-joists and laminated 
veneer lumber (LVL).
    Question. Significant forest and rangeland research is performed by 
industry and universities in addition to the Forest Service. What 
amount of funding by the Forest Service is involved in cooperation with 
industry and universities in performance of the many important research 
functions? Is information uniformly shared with these agencies?
    Answer. The research needed to complete our mission and the 
appropriation level we receive play major roles in determining the 
funds available for our extramural research efforts. Extramural 
research expenditures averaged $24 million dollars the past 5 years, 
approximately 13 percent of annual appropriations.
    Information developed as a result of our cooperative efforts is 
available to the public in formats such as publications, symposia, 
meetings and the internet.
    The USDA Current Research Information System (CRIS) contains 
synopses of all federally funded research. CRIS can be accessed 
electronically by anyone. One use of CRIS information is to minimize 
duplication in research activities.
    Question. As a result of budget reductions the agency obtained 
Reduction in Force (RIF) authority to significantly reduce the size of 
the Research organization. To what degree did expected reductions 
occur? Was a RIF actually implemented? If not, what actions were taken 
to bring program spending in line with spending authorizations? Are 
units with the agency possibly facing RIF?
    Answer. The Forest Service Research (FSR) organization has 
decreased its workforce by approximately 9 percent since the beginning 
of fiscal year 1996. On October 1, 1995, the work force numbered 
approximately 3,104 employees, an estimated 78 percent of which were 
permanent and the remaining 22 percent in temporary appointments such 
as term and post doctoral. As of April 1, 1997, the work force is 
comprised of approximately 2,765 employees, with the ratio between the 
permanent and temporary work force remaining essentially unchanged.
    Due to an 8 percent reduction ($15.5 million) in the Forest and 
Rangeland Research appropriation in fiscal year 1996, FSR anticipated a 
Reduction in Force (RIF) of approximately 70 people. Only 13 people 
were actually terminated through the RIF process. FSR avoided other RIF 
actions and reduced the size of its work force through an aggressive 
and organized outplacement effort which included use of the Agency's 
Employee Placement System, early out and buyout authorities as 
incentives to retire, directed reassignments, and outplacement to other 
government agencies and the private sector.
    Given the President's Budget funding level, we anticipate the 
possibility of using RIF authority in one additional case during fiscal 
year 1997 (at the North Central Station headquartered in St. Paul, MN).
    The effort to bring program spending in line with spending 
authorizations also included reductions in travel, training, awards, 
and minor purchases; leaving funded positions vacant; and closing or 
consolidating offices. During fiscal year 1996 offices were closed in 
Fairbanks, AK; Bend, OR; Carbondale, IL; Orono, ME; Macon, GA; 
Gulfport, MS; and Gainesville, FL. Offices were consolidated in Oxford, 
MS, and New Orleans, LA. In fiscal year 1996, we projected costs 
associated with the closures and consolidations to be about $702,500. 
This includes the costs of transfers of station, building repairs and 
maintenance in anticipation of transfers or sales, and administrative 
costs of transfers of ownership.
    Any changes to the President's Budget will have immediate personnel 
consequences. Each $1 million reduction will affect 19 people, up from 
15 people 3 years ago--a reflection that non-personnel costs have 
already been aggressively reduced.
                         national forest system
Forest health
    Forest Health is a major emphasis item for the Forest Service.
    Question. How is this emphasis [forest health] compatible with and 
how does it contrast with restoring and preserving the economic health 
of communities which rely on the National Forests?
    Answer. An emphasis on forest health is not only compatible with 
restoring and preserving economic health of forest-dependent 
communities, it is essential to the long-term sustainability of such 
communities. A clear example is the reduced risk of catastrophic 
wildfire associated with improved forest health in many areas, which 
can eliminate major parts of the resource base of the community as well 
as threaten its very existence. Reducing the risk of fire will often 
involve removal of commercially valuable timber which can be of direct 
benefit to the local economy.
    Likewise, the social, economic, and environmental condition of 
local communities directly influences the health of the Nation's 
forests. Many communities depend on forest resources to maintain and 
improve their economic well-being. In order to use resources wisely and 
understand the integral connections between the bio-physical and the 
socio-economic worlds, many community-based organizations are taking an 
active role in the discussions and actions aimed at improving forest 
health.
    Through the Economic Action Programs (EAP), the Forest Service is 
working with hundreds of rural communities to develop job skills, 
technology, businesses, educational and leadership programs, and 
collaborative methods for community-based stewardship of natural, 
cultural, and historic resources. Through local action teams and the 
Economic Recovery program, a component of the EAP, the Forest Service 
is using a strategic approach to assist rural communities throughout 
the country to develop broad-based plans and to take an active role in 
natural resource issues on private as well as federal lands. The 
capacity building in the communities results in more effective 
interaction with natural resource managers as well as economic 
diversification and increased self-sufficiency.
    Question. How does the term ``Forest Health'' imply management 
actions which are different than past practices of sound land 
stewardship? What specific land management actions will occur under the 
Forest Health initiative that would not otherwise have occurred as a 
normal course of business over the past 5 years?
    Answer. Management actions taken by the Forest Service to enhance 
forest health, now and in the future, will be consistent with sound 
ecosystem management principles. In some areas in the western United 
States, our past success in eliminating frequent low-intensity 
wildfires has led to conditions of dense accumulation of underbrush and 
over-crowded stands. These conditions render forests highly susceptible 
to large damaging fires, insects, and diseases. We intend to 
substantially increase fuels management and thinning in these areas.
                        land management planning
    Land management planning is proposed for a $3.9 million increase. 
Beginning with 1998 the National Forests are beginning the process of 
land management plan revision.
    Question. The fiscal year 1998 budget proposal will support the 
revision of 4 national forest plans and the initiation of revision for 
58 additional forest plans. With 81 of the 123 total national forest 
plans facing revision by 2002, how will future land management planning 
budget requests be affected?
    Answer. Based on the earliest experiences the Forest Service has 
had with Forest Plan revisions in the National Forests of Texas, the 
Francis Marion (SC), the Black Hills (SD), the Targhee (ID), and the 
Rio Grande (CO), estimated costs per revision are about $500,000 per 
year for 4 years. Between fiscal year 2000 and fiscal year 2002 we 
expect to have some 70 revisions underway each year. Future budgets 
will continue to reflect the best balance of priorities.
    Question. Federal court rulings based on the Federal Advisory 
Committee Act have resulted in delays to such significant ``eco-
region'' planning efforts as the President's Northwest Plan and the 
Sierra Nevada Ecosystem Project. Other projects such as the Tongass 
Land Use Management Plan and the Interior Columbia Basin Ecosystem 
Management Project may be affected. What other significant projects 
could also be affected?
    Answer. No perceived delay was realized as a result of the December 
31, 1996 District of Columbia Appeals Court ruling that the Sierra 
Nevada Ecosystem Project was subject to the requirements of the Federal 
Advisory Committee Act. The Sierra Nevada Ecosystem Project Report was 
released in June of 1996.
    The Forest Service intends to conduct activities related to the 
Tongass Forest Plan, the Interior Columbia Basin Ecosystem Management 
Project, and others in such a manner that Federal Advisory Committee 
Act provisions will not be violated. Federal Advisory Committees will 
be chartered when it is appropriate to do so.
    Questions. (a) Can it be expected that larger ``eco-region'' 
planning efforts will reduce the number and complexity of forest plans 
which will require revisions? (b) If so, what are the anticipated 
effects and efficiencies?
    Answers. (a) These large planning efforts which often result in 
multiple forest plan amendments, will not reduce the number or 
eliminate the requirement to revise forest plans on a 10-year cycle or 
at least every 15 years as required under NFMA. Ecosystem assessments 
will, however, reduce the complexity of the forest planning effort. (b) 
The major efficiency is that cumulative effects questions are largely 
addressed by the assessment. This allows forest planning efforts to 
focus on how the individual plan fits within the broader context 
identified by the assessment. Assessments now provide this perspective, 
and reduce the burden on individual forests to address cumulative 
effects.
    Other major effects from assessments include the efficiency of 
collecting common data for the participating land ownerships in the 
project and the active support of key science personnel in reviewing 
federal management strategies. Collection of common data is usually a 
first step to enable different land entities to effectively communicate 
and develop management approaches based on a common framework. The 
involvement of key scientists on the assessment teams also ensures the 
assessment itself will have scientific credibility in addressing key 
questions.
    Within the past year, final reports have been issued by the three 
major eco-regional assessments which have been ongoing for several 
years. These reports are the Interior Columbia Basin Ecosystem 
Management Project Report, the Sierra Nevada Ecosystem Project Report, 
and the Southern Appalachian Assessment Report.
    Question. How has the Forest Service begun to incorporate the 
information contained in these reports into Forest Plans within the 
areas covered by these reports?
    Answer. Two draft environmental impact statements have been 
prepared utilizing information from the Interior Columbia Basin 
Ecosystem Management Project Report. Future decisions associated with 
these two statements will amend up to 74 Forest Service and BLM 
management plans. These two documents were distributed the week of June 
9 of this year, with final documents expected 1 year later.
    Available information from the Sierra Nevada Ecosystem Project was 
considered in the development of the California Spotted Owl preliminary 
Revised Draft Environmental Impact Statement, which will significantly 
amend ten forest plans.
    Information contained in the Southern Appalachian Assessment is 
currently being utilized in the revision of five forest plans. 
Information in this assessment will form the basis for the issues and 
forest plan decisions that will be examined during the plan revision 
process.
    Question. How have project plans and management activities changed 
because of these reports?
    Answer. Ecosystem assessments have brought about a major change in 
project planning as a result of focusing increased attention and 
concern for the ultimate condition of the ecosystem. In the past, 
projects were usually designed primarily to accomplish a particular 
goal of delivering goods and services to the public with a disclosure 
of environmental effects. Today, projects are designed with a major 
consideration of how long-term ecosystem health will be affected by the 
project, while also providing certain goods and services. Assessments 
have highlighted the effects that certain kinds of projects and 
activities may have on the ecosystem. Assessments have aided 
understanding of relationships among forests within similar ecosystems 
and across ownerships. They have provided managers with vital resource 
information for informed decisionmaking.
    Question. How does the Forest Service plan to incorporate the 
findings of these reports into its daily management and planning 
activities?
    Answer. The results of the assessments will be used as a management 
tool that will help guide, as appropriate, the daily management and 
planning activities in two ways: (1) change or affirm management 
direction in land and resource management plans; and (2) reconsider or 
validate appropriate site-specific projects to implement plan 
direction. In the first case, land and resource management plans may be 
amended (or in the case of the Southern Appalachian Assessment, 
revised) to change or add goals, objectives, standards, or guidelines 
that set the framework for future site-specific, project-level 
management activities. These plan level decisions may affect the type, 
design, location, and timing of projects proposed to implement the new 
plan direction.
    In the second case, land and resource management plan direction may 
be compatible with the results of the assessment, but new information 
about how the ecosystem responds to particular management activities 
may be helpful in improving the method, design, or timing of projects 
proposed to implement plan direction.
    Question. Salmon recovery is a major issue in the Pacific 
Northwest. What cooperative efforts and through what specific programs 
is the agency assisting other federal, state and local agencies in this 
recovery program? How much funding has been spent relative to salmon 
recovery in the past 3 years?
    Answer. The Forest Service uses a number of cooperative efforts to 
accomplish salmon recovery in the Pacific Northwest. The Northwest 
Forest Plan (NFP) includes a comprehensive watershed restoration 
strategy designed to improve entire watersheds inhabited by salmon. The 
NFP places strong emphasis on Federal/State agency cooperation and on 
local coordination and involvement in whole watershed restoration. A 
second major cooperative effort for salmon recovery is the Northwest 
Power Planning Council's Columbia River Basin Salmon recovery program. 
The Council's effort affects 10 National Forests. Through the Columbia 
River Basin Andromous Fish Policy (1992), the FS committed to helping 
achieve a doubling of salmon runs in the basin and is involved in 
cooperative planning, restoration and monitoring/evaluation. Finally 
the FS is an active partner in a variety of State sponsored restoration 
initiatives. The most notable recent example is the Oregon Coastal 
Salmon Restoration Initiative developed to recover coastal stocks of 
coho salmon. This was an interagency effort spearheaded by Oregon 
Governor Kitzhaber. The FS has been actively involved in its 
development and has made a number of commitments including active 
participation and cooperation in the restoration of coastal watersheds. 
Similar efforts are soon expected to broaden the scope of this effort 
to most of Oregon and Washington.
    On a local level, many District and Forest fishery biologists 
provide technical support to watershed councils. Watershed councils are 
increasingly viewed as the key to generating grassroots support for 
salmon recovery.
    The FS, Pacific Northwest Region has expended approximately 
$23,000,000 per each of the last 3 years for salmon habitat restoration 
activities.
    The Table below illustrates the approximate distribution of these 
funds by broad program area. The table includes Trust Funds (for 
example, KV) that contribute to meeting restoration objectives. Not 
included are a variety of funds, which indirectly benefit salmon 
habitat restoration, such as funds for road/trail and recreation 
maintenance and construction, land acquisition, etc.

                                            PACIFIC--NORTHWEST REGION                                           
----------------------------------------------------------------------------------------------------------------
                                                                           Expenditures by fiscal year--        
                          Program area                           -----------------------------------------------
                                                                       1995            1996            1997     
----------------------------------------------------------------------------------------------------------------
Coordination and habitat management.............................      $4,505,000      $3,695,000      $3,420,000
Jobs in the Woods...............................................      11,100,000      11,000,000      11,176,000
Mid/Upper Columbia River restoration............................       2,350,000       1,300,000       1,900,000
                                                                 -----------------------------------------------
      Subtotal..................................................      17,955,000      15,995,000      16,496,000
Trust Fund Program..............................................   \1\ 6,500,000       6,890,000       6,715,000
                                                                 -----------------------------------------------
      Total.....................................................      24,455,000      22,885,000      23,211,000
----------------------------------------------------------------------------------------------------------------
\1\ Estimated expenditures for trust funds for fiscal year 1995.                                                

    Question. During the fiscal year 1997 appropriations hearing, Mr. 
Lyons stated that in the year 2000, recreation will contribute $97.8 
billion to the U.S. economy, while timber will contribute only $3.5 
billion. The Subcommittee staff has reviewed a January 1997 report from 
three PhD.s with natural resource economics expertise which strongly 
disputes this contention. The report states that timber related 
functions will provide 2.25 times the economic contribution that 
recreation, wildlife and fish programs combined will provide. Please 
provide a detailed analysis of this report with specific attention to 
the contribution of timber to the Gross Domestic Product versus the 
contribution of Recreation. Please identify the basis for the 
statements made by Mr. Lyons and specifically how his contentions 
differ from those presented in the January 1997 report.
    Answer. The basis for Mr. Lyons' statements about the contributions 
of recreation and timber to the gross domestic product is the economic 
analysis of job and income effects displayed in the Draft 1995 Forest 
and Rangeland Renewable Resources Planning Act (RPA) Program. This 
analysis estimated the jobs and income (defined as contributions to 
gross domestic product) that can reasonably be associated with Forest 
Service activities and outputs from the National Forests, as 
anticipated for the future based on the proposal in the Draft 1995 RPA 
Program. The January 1997 report referred to by the Subcommittee 
differs from the Forest Service analysis in three main areas: 1) the 
analysis in the January 1997 report includes only a fraction of the 
anticipated Forest Service recreation use (assumed recreation use 
estimates are too high, reduced local use, and reduced use based on the 
assumption that use would decrease if a fair market value fee was 
charged); 2) timber effects are all calculated at end use in 
residential construction, rather than at the sawmill or pulpmill 
(Forest Service estimates about 60 percent of volume harvested is used 
in housing construction); and 3) the timber effects are estimated in a 
national model. Regarding the first two points, we believe the 
assumptions and procedures used in the Forest Service analysis for the 
Draft 1995 RPA Program were appropriate given the purpose and focus of 
that analysis. Regarding the third point, we do plan to use a national 
model for estimating timber impacts for the Recommended RPA Program. 
The Subcommittee has been provided a paper that provides a more 
detailed evaluation of the January 1997 report and how they differ from 
the Forest Service approach used in the analysis of the Draft 1995 RPA 
Program.
    The economic impact analysis of the Draft 1995 RPA Program provides 
measures of the total value or importance of economic activities 
associated with Forest Service resource outputs. We believe it is 
important to stress that neither of the economic impact analyses should 
be used as the basis for budget allocation or investment decisions, 
since these analyses were not designed for those purposes. Nor does the 
analysis suggest that production of a variety of uses is not compatible 
or desirable. Other types of analysis are needed to inform investment 
and budget allocation decisions, such as marginal analysis that looks 
at the effects of changes in levels of investment. All Forest Service 
programs have value and importance to the Nation and to local 
communities. Various measures are needed to represent such values and 
importance.
                 forest service decision making process
    The Forest Service's decision making process is a critical 
function; but it is costly. In the past 20 years, the Forest Service 
has spent over $20 million developing multiyear plans for managing 
timber production, livestock grazing, recreation, fish and wildlife 
habitat, and other legislatively mandated uses on national forests. The 
Forest Service also spends about $250 million per year for 
environmental studies to support individual projects. However, 
according to an internal Forest Service report (Final Report of 
Recommendations: Project-level Analysis Re-engineering Team 11/17/95), 
inefficiencies within this process cost up to $100 million per year at 
the project level alone. Critics state that by the time the agency has 
completed its decision making process, it is often unable to carry out 
the plans because of changes in natural conditions and funding, or new 
information and events.
    Question. What actions were recommended in the internal Forest 
Service study to reduce the inefficiencies within its decision making 
process?
    Answer. The NEPA Re-engineering study was a Region 8 and 9 effort 
completed in November of 1995. This report was presented as a draft 
report for use by the agency as a whole. The Forest Service has used 
this study in guiding improvements to the NEPA process. The report 
contains ten recommendations as follows:
    1. Limit NEPA analysis to discretionary Forest Service actions that 
may have an effect on the quality of the physical and biological 
environment.
    2. Address landscape issues at appropriate levels and incorporate 
analyses into either Forest Plan or project-level decisions.
    3. Maintain a centralized system of environmental information that 
is useful and easily accessible to project analysis teams.
    4. Eliminate redundant analyses; focus on what is new.
    5. Use existing analyses to support new decisions when possible.
    6. Develop alternatives in environmental assessments only when 
there are unresolved conflicts.
    7. Expand categorical exclusions and develop new categories based 
on ecological units and thresholds of acceptable change.
    8. Accept appeals as legitimate way to resolve substantive 
conflicts.
    9. Limit appeal standing and appeal points to substantive issues 
raised in written comments during public comment periods.
    10. Use litigation proactively to support Forest Service NEPA 
policy.
    Current laws provide the authority to implement each of these 
recommendations, with the possible exception of recommendation number 
9.
    Question. Has the Forest Service acted on the recommendations in 
the internal study?
    Answer. The following actions are being taken by the Forest Service 
based on the internal study recommendations:
    1. Link NEPA analysis to discretionary FS actions (i.e. those 
actions for which we have primary authority, as opposed to those 
actions for which we provide input to other federal agencies but do not 
have primary authority.)
    The FS Manual and Handbooks are being changed to reflect what 
environmental analysis and documentation is required and not required 
for many agency activities. Examples are: (1) special use permit re-
issuance, (2) use of roads by contractors, (3) road maintenance by 
State agencies, (4) granting rights-or-ways across NF lands, (5) FERC 
re-licensing, and (6) grazing permit issuance.
    2. Address landscape issues at appropriate scales (e.g., an issue 
pertinent to an entire region should be addressed at a regional scale, 
while one pertinent only to a smaller geographic area should be 
addressed at that scale)
    A number of landscape assessments have been or are being prepared 
over the next few years. These assessments will serve as a basis for 
environmental analyses that can be incorporated by reference into 
Forest Plan and project analyses. These Ecoregional Assessments 
include: Interior Columbia River Basin, Sierra Nevada, Ozark-Ouachita 
Highlands, Great Lakes, Northern Great Plains and Southern Appalachian.
    3. Maintain a centralized system of environmental information. The 
FS has initiated a number of initiatives to improve availability and 
useability of information. The Resource Inventory and Monitoring 
Institute is now housed in Ft. Collins, CO to develop better procedures 
for integrating monitoring and inventory into decision making. A Common 
Survey Data Structure (CSDS) effort is underway to standardize data 
protocols for resource information throughout the agency. The protocols 
from the Monitoring Institute and CSDS will allow integrated data bases 
to be shared among Regions and agencies. Additionally, a pilot CD ROM 
test is being performed in fiscal year 1997 to organize a centralized 
collection of administrative appeal decisions, NEPA case law, and NEPA 
``good'' examples for use by the field.
    4. Eliminate redundant analyses.As the FS moves towards full use of 
the new 615 computer equipment and network, it will be possible to 
immediately share and retrieve environmental analysis done anywhere 
within the agency. The 615 technology is being tested on the Kootenai 
National Forest to demonstrate efficiencies gained in environmental 
analysis and documentation. The pilot testing includes Geographical 
Information System (GIS) analyses, direct transfer of analysis tables, 
matrices, and graphics to environmental document, and realtime public 
review of computer analyses. The Kootenai has estimated considerable 
savings in document preparation time, as much as 20 to 40 percent.
    5. Use existing analyses to support decisions. The agency has 
developed a Decision Protocol that incorporates this action item. Pilot 
applications of the Protocol within each Region are showing reductions 
in information gathering costs as high as 40 percent.
    6. Develop a more limited set of alternatives. The Agency's 
Decision Protocol incorporates this action item. The environmental 
issues are addressed through mitigation where possible, unresolved 
conflicts about resource allocations are being used to focus the 
alternatives. Regional offices also are working with forests on ways of 
reducing the number of alternatives without compromising quality 
environmental analysis.
    7. Expand Categorical Exclusions. The NEPA Handbook is being 
changed to: (1) expand the scope of categorical exclusions; (2) clarify 
the application of extraordinary circumstances; and (3) permit Regions 
to establish categories specific to local conditions. The categorical 
exclusions are being coordinated with the BLM to ensure greater 
consistency between the two land management agencies. A draft of 
proposed categorical exclusions is scheduled for fall 1997.
    8. Accept appeals as a way to resolve conflict. Alternative dispute 
resolution is being tested in connection with range appeals to allow 
for better communication, than our current system allows, between the 
Forest Service and appeallants. This technique may be tried in other 
areas depending on the nature of success.
    9. Limit appeal standing and points of appeal to substantive 
conflicts. No action to date. Concerns exist that this will not be in 
conformance with the Administrative Appeal Law and would require a 
change in legislation for the Forest Service.
    10. Use litigation proactively to support NEPA policy. The Office 
of General Counsel has written a number of papers that spell out the 
legal strategy to support forest planning, project planning, tiering, 
and unavailable and incomplete information. The OGC has engaged in a 
series of discussions with CEQ and DOJ on the scope of Forest Plans, 
application and timing of ESA with NEPA and application to Forest 
Plans. This dialogue will continue.
    Question. If actions have been taken on the recommendations in the 
internal study, how much has the Forest Service saved in terms of 
appropriations and time as a result of implementing the 
recommendations?
    Answer. Savings and efficiencies are being made as improvements are 
implemented. Initial estimates of savings on environmental analysis 
have been estimated as high as 20 to 40 percent depending on the 
project. Improvements address many different aspects of the 
environmental analysis and project approval, including how we process 
special use applications, how we address range allotment analyses, 
earlier and streamlined consultation with regulatory agencies, 
consideration of increasing situations where Categorical Exclusions are 
appropriate and limiting the purpose and need for action. It is 
difficult to assess cost or time savings from any one action. We will 
continue to make improvements and over time will be able to estimate 
savings in a meaningful way.
          interior columbia basin ecosystem management project
    This effort has required extensive collaboration between agencies. 
The Draft Environmental Impact Statements are scheduled for release in 
early 1997.
    Question. What permanent cooperative arrangements can be expected 
between the Forest Service and the Bureau of Land Management which will 
reduce costs and promote efficiency?
    Answer. No permanent cooperative arrangements have been put in 
place at this time. While it is premature to know the specifics of what 
topics will be subject to any cooperative agreements, we expect some 
attention will be focused on field monitoring and data collection and 
storage; on watershed analysis and sub-basin reviews as part of 
implementation of this strategy, long-term consistency in application 
of standards and objectives, and that in some cases the agencies will 
share personnel.
    Questions. (a) How have the respective missions of the Fish and 
Wildlife Service and the National Marine Fisheries Service benefitted 
this process? (b) Have there been any negatives to this cooperative 
effort?
    Answers. (a) The involvement of these two agencies and the 
Environmental Protection Agency has been to ensure that broad-scale 
ecosystem management strategies comply with environmental laws like the 
Clean Water Act and the Endangered Species Act. A second benefit has 
been to develop interagency partnerships that will facilitate future 
implementation. (b) No. While the draft EISs took longer than expected 
to produce, we believe the documents are much stronger than they would 
be otherwise, and there is a stronger commitment from all involved 
agencies.
    Question. What level of participation has occurred with State and 
local governments in the planning process?
    Answer. Early involvement of other federal agencies and county and 
state governments is a highlight of this project. Counties and States 
have been involved from the early stages. Four state associations of 
counties formed the Eastside Ecosystem Coalition of Counties in 1994 to 
keep informed and involved in the project and its progress. A 
memorandum of understanding between the Project Managers and Eastside 
Ecosystem Coalition of Counties was signed in 1995. Mutual benefits 
have been gained from sharing different perspectives, data, and 
information. A June 30, 1995 letter to U.S. Senator Mark Hatfield, the 
Association of Oregon Counties states:
    ``This is the first time a multi-state county group has 
participated directly and from the beginning in a significant federal 
resource management planning process. There will likely be a positive 
impact on the federal work product, and a foundation has been laid for 
genuine, long-term improvements in federal/county communication. The 
National Association of Counties is following progress closely, because 
EECC is creating the model for county involvement in other regions.''
    Other key developments from this project are new relationships 
established with tribal governments. Significant time and energy has 
gone into building trust and working relationships with more than 20 
separate tribal governments in the project area. Past experiences have 
made these tribes skeptical of the ability of this project to produce 
results. Tribes have not been involved in early stages of a project in 
the past, and were not prepared with money or people to react quickly. 
The benefits of the relationships established are valuable and 
necessary for the future.
    The project involved state, tribal and local governments and 
Resource Advisory Councils and Province Advisory Committees in a 
process to help identify the preferred alternative. Meetings and 
presentations to these governments and advisory groups occurred 
beginning in the summer of 1996, and continued into the winter of 1997. 
These relationships form the basis for cooperation which can depolarize 
divided opinions about conservation and management that now exists.
    Question. Within the alternatives being considered please identify 
the commodity outputs being analyzed under each alternative.
    Answer. The potential outputs from the various alternatives are 
displayed below. While potential outputs are displayed, the decisions 
for the ICBEMP will not change the outputs identified in current land 
management plans; such changes will occur, as needed, in future plan 
revisions.

       COMMODITY OUTPUTS FOR EASTERN OREGON AND EASTERN WASHINGTON      
                            [Eastside draft]                            
------------------------------------------------------------------------
                                                       Estimated--      
                                               -------------------------
                                                   Timber               
                                                 volume in     AUM's in 
                                                    MMBF      thousands 
------------------------------------------------------------------------
Alternative:                                                            
    1.........................................          887          685
    2.........................................          393          674
    3.........................................          724          681
    4.........................................          765          674
    5.........................................          923          730
    6.........................................          625          674
    7.........................................          313          378
------------------------------------------------------------------------
Source: From table 4-50, Eastside draft environmental impact statement. 


         COMMODITY OUTPUTS FOR IDAHO, W. MONTANA, AND N. NEVADA         
                   [Upper Columbia River basin draft]                   
------------------------------------------------------------------------
                                                       Estimated--      
                                               -------------------------
                                                   Timber               
                                                 volume in     AUM's in 
                                                    MMBF      thousands 
------------------------------------------------------------------------
Alternative:                                                            
    1.........................................          840        1,910
    2.........................................          820        1,878
    3.........................................        1,120        1,899
    4.........................................          944        1,878
    5.........................................        1,390        2,036
    6.........................................          610        1,878
    7.........................................          440        1,055
------------------------------------------------------------------------
Source: From table 4-50, Upper Columbia River basin draft environmental 
  impact statement.                                                     


    TOTAL COMMODITY OUTPUTS FOR INTERIOR COLUMBIA BASIN PROJECT AREA    
             [Eastside and Upper Columbia River basin draft]            
------------------------------------------------------------------------
                                                       Estimated--      
                                               -------------------------
                                                   Timber               
                                                 volume in     AUM's in 
                                                    MMBF      thousands 
------------------------------------------------------------------------
Alternative:                                                            
    1.........................................        1,727        2,595
    2.........................................        1,213        2,552
    3.........................................        1,844        2,580
    4.........................................        1,709        2,552
    5.........................................        2,313        2,766
    6.........................................        1,235        2,552
    7.........................................          753        1,433
------------------------------------------------------------------------
Source: Totaled from tables 4-50, Eastside draft environmental impact   
  statement, and 4-50, Upper Columbia River Basin draft environmental   
  impact statement.                                                     

                               recreation
    The focus of the recreation program in fiscal year 1998 centers on 
universal designs for accessibility; the heritage program; implementing 
new legislation on permit fees for ski areas and the Recreation Fee 
Demonstration sites; emphasis on special recreation areas including 
wilderness and wild and scenic rivers; preparing for the 2002 winter 
Olympics; and testing the Public-Private Venture concept.
    Question. Please provide a listing of the cooperative recreation 
projects which the Forest Service intends to spend $15 million to 
perform in fiscal year 1998; and an identification of the sources for 
the estimated $32.5 million in cooperative funds.
    Answer. Although we have not identified fiscal year 1998 partners 
for specific projects, the following list provides a few examples of 
current projects types and partners:
Georgia, North Broad River Recreation Restoration
  --Reconstruct campsites; construct trails, interpretive signs, and 
        accessible fishing deck; relocate road; stabilize streambank; 
        and enhance fish habitat.
  --Partners: Georgia Department of Natural Resources, Trout Unlimited, 
        and Wish to Fish (physically challenged group).
  --Funding: FS $9,500 Partners $9,600.
Colorado, Colorado Fourteeners Initiative
  --Construct sustainable high country trails, reclaim erosion areas, 
        install information kiosks at two trailheads, and build a new 
        parking area.
  --Partners: The American Mountain Foundation, Volunteers for Outdoor 
        Colorado, Great Outdoors Colorado, Outward Bound, The Colorado 
        Mountain Club, and Colorado Fourteeners Initiative.
  --Funding: FS $53,900 Partners $62,800.
Alaska, On Your Knees Cave
  --Construct entry gate, trail, and tent platform; continue research; 
        develop a stewardship plan; develop and implement interpretive 
        and education programs for a newly discovered cave and 
        archaeological site of international significance.
  --Partners: Community Volunteers Association, Denver Museum of 
        Natural History, Port Protection Association, and National 
        Geographic Society.
  --Funding: FS $42,900 Partners $72,320.
Utah, Huntington Watershed Restoration
  --Reconstruct 67 camping sites, construct three restrooms, close and 
        rehabilitate 25 camping sites, improve angler trails, expand 
        the group campground, and re-establish streamside vegetation.
  --Partners: Genwal Resources, Inc., Castle Country Travel Council, 
        Carbon County, Sanpete County, Canyonlands Natural History 
        Association, Emery County, State of Utah (Division of Wildlife 
        Resources, Department of transportation, and Parks and 
        Recreation), Trout Unlimited, and local Energy/Mining 
        interests.
  --Funding: FS $90,000 Partners: $90,000.
North Carolina, Carolina Hemlock Campground
  --Drill new well; install new pump, chlorinator, and distribution 
        system; and construct eight ADA accessible water fountains and 
        hose bibs.
  --Partners: Cradle Of Forestry Interpretive Association.
  --Funding: FS $40,000 Partner: $40,000.
Montana, Path of the Grizzly Interpretive Trail
  --Construct one half mile of trail; install benches, kiosks, and bike 
        racks; design, fabricate and install interpretive media; and 
        design and print education material.
  --Partners: Blackfeet Nation, Meridian Aggregate, Montana Department 
        of Transportation, Northwest Interpretive Association, Wildlife 
        Forever, Montana Fish, Wildlife, and Parks, and The Nature 
        Conservancy.
  --Funding: FS $13,000 Partners: $79,000.
Oregon, Pine Ridge Day Use Mitigation
  --Construct access road, 45 car trailhead and OHV staging area, 
        restrooms, well, drainfield, and utilities.
  --Partners: Oregon Department of Transportation.
  --Funding: FS $175,000 Partner $445,000.
California, Lake Tahoe Heritage Preservation and Interpretation
  --Stabilize the Newhall House, historic structure; preserve and 
        interpret structures related to Chinese Encampment, develop and 
        install interpretive signing on a National Recreation Trail, 
        one of original routes into Basin, and at an historic gazebo.
  --Partners: Tahoe Heritage Foundation.
  --Funding: FS $5,550 Partner $9,750.
New Mexico, Tres Piedras Trail 41
  --Construct two new one-half mile sections of trail; sign 16 miles of 
        access roads; and stabilize, drain, revegetate, and put to bed 
        one mile of existing road.
  --Partners: Chuckwagon Trailriders, Rocky Mountain Youth Corps, and 
        New Mexico Wildlife Federation.
  --Funding: FS $6,100 Partners $9,460.
Wisconsin, Wilson Flowage Dike Reconstruction
  --Reconstruction of two dikes on a premier waterfowl flowage with 
        trophy northern pike fishery.
  --Partners: Ducks Unlimited, Great Lakes Indian Fish and Wildlife 
        Commission, National Fish and Wildlife Foundation, and 
        Wisconsin Department of Natural Resources.
  --Funding: FS $20,000 Partners $250,000.
    Question. The fiscal year 1998 Explanatory Notes do not provide 
much detail on the costs of planning and investment in facilities and 
infrastructure for the 2002 Winter Olympics in Utah. What major efforts 
will be underway in fiscal year 1998 relative to the 2002 Winter 
Olympics?
    Answer. Funding is provided for the following major efforts: A 4-
person team to manage, guide, interface, and partner with the myriad of 
local, national, and international organizations to develop and 
implement annual plans so that Forest Service representation in the 
2002 Winter Olympics is fully visible with appropriate representation. 
Work also continues with the Snowbasin land exchange. ($300,000)
    Salt Palace visitor information partnership; Anderson Cove/
Lodgepole Campgrounds-PPV, NEPA, planning; Snowbasin land exchange; 
venu preparation, and natural resources conservation education. 
($426,000)
    50 percent of the Regions Capital Investment Construction/
Reconstruction program. ($1.1 million)
    Trail re/construction. ($400,000)
    Questions. A December 1996 GAO report stated that the Forest 
Service has failed to collect fair market value for a multitude of 
commercial and non-commercial special use permits. This issue was 
recently highlighted in an NBC News ``Fleecing of America'' episode. In 
that episode NBC stated that the Forest Service refused to comment 
about the validity of the GAO report. The agency budget justification 
states that recreation special uses generate $47.5 million for the U.S. 
Treasury, but it does not address any changes to the system which might 
provide for increased revenue's on a scale comparable to similar state 
owned uses as referred to by GAO. The budget justification speaks to 
updating recreation residence fair market value by 1999 and to 
implementing new ski resort fee system legislation. Is it the agency's 
contention that these initiatives will adequately address issues raised 
by GAO? Has the agency responded to the GAO report?
    Answers. The Forest Service generally agrees with the report's 
conclusions and has so stated in its response to GAO. Many holders of 
special use authorizations do not pay fair market value for the right 
and privilege of use and occupancy of National Forest System lands. The 
Forest Service recognizes the importance of obtaining a better return 
for the use of public resources and to recover the costs for providing 
these recreation opportunities. It endorses the concept of placing the 
special use authorization program on a more business-like basis.
    The Forest Service is updating its fee systems to better reflect 
fair market value. The question mentions recreation residence and ski 
resort fees as two examples. Recreation residence appraisals should be 
completed in fiscal year 2002. The recently passed ski fee legislation 
will be implemented this summer. The challenge with any fee system is 
balancing the benefits of retaining its currency with the 
administrative costs of doing so. In many cases, the Forest Service is 
indexing fee schedule rates to retain some degree of fair market value 
currency between periodically scheduled (and costly) fee structure 
updates. The Ski Fee legislation calls for a review in 1999 to 
determine if it indeed meets fair market return.
    The Forest Service is developing Cost Recovery regulations as 
recommended by GAO. Once implemented, these regulations would recover 
from the permittee costs borne by the Forest Service in responding to, 
processing and administering permits. Implementation is anticipated in 
the fall of 1997.
    We cannot yet predict what change our current initiatives will make 
on receipts to the U.S. Treasury. To do that we first need to conduct 
appraisal and market rent studies to determine values for the various 
types of uses we authorize.
    Question. The agency's performance indicator for wilderness 
management is miles of trail available. This indicator does not speak 
to a measure for the amount of use by the public. What is the history 
of wilderness use over the past 5 years? What is the increase in number 
of wilderness areas created and managed over the past 5 years? As the 
average age of the US population increases, is wilderness use 
declining? How are the 26,610 miles of trail categorized in terms type 
of trail? Some wilderness philosophy speaks to eliminating many trails 
within Wilderness to make the areas even more primitive. Is the agency 
affected by this philosophy in terms of a standard for ``miles of trail 
available?''
    Answer. Wilderness use over last 5 years increased about 9 percent, 
from 13,272 Recreation Visitor Days (RVDs) in fiscal year 1992 to 
14,512 RVDs in fiscal year 1996. Wilderness use appears to be 
maintaining a reasonably constant, to slightly increasing, level. 
Wilderness use is not declining as a result of an increase in average 
age of the population; instead, wilderness visitors are becoming more 
reflective of the diverse American public. Studies conducted by the 
Aldo Leopold Wilderness Research Institute from 1972 through 1991 note 
the following changes in wilderness visitors: wilderness visitors today 
tend to be older than those who used wilderness in the past, there is a 
higher percentage of women using wilderness, the educational level of 
wilderness users is higher than in the past, and although racial 
minorities are still not well represented among wilderness users, this 
user segment continues to grow (Cole, Watson, Roggenbuck, 1995).
    From 1991 through 1995, 17 wildernesses were designated on National 
Forest System lands. This added 944,882 acres to the National 
Wilderness Preservation System, and increased the acreage of wilderness 
managed by the Forest Service by approximately 3 percent. While these 
areas are certainly worthy additions to the National Wilderness 
Preservation System, the change in total wilderness areas and acres 
managed by the Forest Service does not seem a viable indicator of 
management performance. The job is not to create or encourage new 
wildernesses, but to appropriately steward those lands under our 
administration.
    As displayed in the budget, the 26,610 miles of trail are miles 
available within wilderness, in addition to 87,466 miles available 
outside of wilderness. The Forest Service does not have a national 
objective of the trail program to eliminate trails within wilderness to 
make the areas more primitive. Instead, trail densities and travel 
planning in wilderness are determined, with public participation, by 
resource protection and wilderness use objectives. The Forest Service 
is currently developing wilderness performance measures in the 
following areas: ecological integrity, wilderness values, public use, 
and special provisions and administration.
    Question. The agency cites an increase in use of concessionaires by 
70 percent over the past decade. What affect will this amount of 
recreation concessionaires have on the Recreation Fee Demonstration 
program? How will potential receipts by affected?
    Answer. Concessionaires will continue to play a significant role in 
the delivery of national forest recreation services. The existing 
concession program will not have a significant impact on the recreation 
fee demonstration program or potential receipts. The fee demonstration 
program encompasses only 100 projects across the entire National Forest 
System. More than enough project diversity exists to let the Fee Demo 
test a wide range of projects. Many of the projects consist of 
developed sites that are not concession managed. The test should enable 
the Agency to make a better estimate of fee potential from all sites.
    As the Agency has implemented the fee demo, firm emphasis has been 
placed on the value of collaboratively working on demonstration project 
proposals with concessionaires as these projects can have an affect on 
the concessions business. With a significant part of the recreation 
opportunities on national forest land being carried out by cooperators, 
it is vital that we work closely with them. These cooperators not only 
provide direct services to our customers, maintain sites under permit, 
but as private businesses they also return millions of dollars into 
local rural economies.
    Flaming Gorge NRA is an example of this collaboration. In the NRA 
more than 24 permit holders and the Forest Service collectively carry 
out the extensive level of customer services which occur at this high 
use site. By focusing on collaborative relationships, the NRA has 
successfully implemented a fee demo project with full support of every 
permittee--critical support in that these permittees serve common 
customers, return benefits to local economies, and have political 
representation.
    In summary the Forest Service is managing both these contemporary 
tools--concessions and the fee demo--to compliment one another. 
However, these are the types of issues that the fee demo test will 
provide valuable information on.
    Question. The Recreation Fee Demo project allows use of collections 
to perform recreation facility reconstruction and construction. To what 
degree will such collections be utilized for this purpose? What has the 
public's reaction been to the use of funds for this purpose?
    Answer. The Agency has a vast array of projects operating under the 
fee demo. Some are small, others are very large. Many focus on direct 
customer services and facility enhancements--with a focus on repair and 
reconstruction of old run down facilities. However, due to the 
relatively short implementation period to date, few actual 
reconstruction projects have started. In many cases, clean up 
activities, painting, and cleaner restrooms are examples of immediate 
actions the demo projects are doing to show fee paying customers a 
quick benefit.
    Each demonstration project has a business plan that includes a 
priority list of needs--how, where, and when expected fee revenue will 
be used for specific tasks. Also, every project has a communication 
plan, outlining each step needed to keep their customers informed, 
reach community acceptance, and help keep Congress informed of these 
items.
    To-date the Agency is experiencing a high level of community 
acceptance of projects and new fees. We feel our extensive efforts to 
communicate and educate our customers has been critical to the success 
of the program.
    Question. The fee demonstration program was implemented with a 3 
year test period and extended for 1 year. Are projects being brought on 
line as scheduled? What projects, if any, that were originally planned 
for recreation fee demonstration may not be brought into the program 
due to delays?
    Answer. Most projects are coming on line very close to projected 
start dates. Two have been dropped--one due to liability concerns 
associated with charging a fee in an area with known fatalities (Rim 
Lakes,--Apache-Sitgraves N.F.--Ariz) and one because the Poudre River 
Complex--Arapahoe-Roosevelt N.F., Colorado, decided to concession 
instead. Some projects have been delayed due to major proposal 
modifications based on public feedback. We expect to have 40 projects 
from the first 50 collecting fees by July 1, 1997. The others plan to 
come on line later in fiscal year 1997 or early in fiscal year 1998. 
The Regions are currently submitting proposals for the next 50 projects 
and we expect that some of these will also be ready to come on line in 
fiscal year 1997, and early fiscal year 1998.
    Question. The recreation fee demonstration project will involve the 
collection of significant sums of money in several areas. What plans 
has the agency made to protect these funds from theft? What plans have 
been made to protect the safety of employees making these collections?
    Answer. The Forest Service has been collecting fees in developed 
sites for many years. Existing Agency fiscal requirements for handling 
money will continue to be applied to the Fee Demo projects. Theft and 
employee protection are included in current procedures. Employee safety 
will not be jeopardized. In some projects, the volumes of cash 
collections are significantly larger than the Agency has experienced in 
those locations in the past. We are beginning to explore the use of new 
avenues for payment with the use of credit cards /debit payments etc. 
Developing innovative solutions to address the increased volume and new 
processes are also part of the test. Some of the areas being explored 
include: increased use of credit cards and vendor sales to reduce cash 
handling, armored car services for cash transfer, automated vending 
machine pass purchase, audit and accountability guidelines for these 
new tools/processes, and increased law enforcement coordination.
    Question. How are payments of fees being enforced at demonstration 
sites? What actions are being taken with individuals who refuse to or 
who are uncooperative in paying fees?
    Answer. Local compliance programs are being established for each 
Fee Demo project. Most units are taking a light handed approach to fee 
compliance during the start up phase. ``Fix-It Tickets'' are being used 
in some places--buy your pass and no fine is assessed. A high level of 
compliance is critical to the success of the fee Demo program. If a 
significant number of visitors do not pay, visitors that do pay will 
not be pleased. During start-up activities at all sites, widespread 
communication, education and signage will be the focus. As a last 
resort, the law gives each Agency the authority to issue tickets with a 
fine of up to $100.
    Question. A recent news article (Oregonian, 3/22/97) spoke of a fee 
structure at the Mt. St. Helens Visitor Centers, which only allows for 
a multi-day pass as opposed to a single day pass. How are fee 
structures established at local fee sites? Is maximum flexibility being 
offered to the public for both short and extended stays?
    Answer. The intent of the fee demo pilot is to test various fee 
methods and public reaction and acceptance. Each project can experiment 
with various fee levels and procedures. Short and long term stays are 
addressed in most areas by having a short stay pass of some sort--one 
to seven days seems to be the range, and annual passes.
    At Mt. St. Helens, we are experimenting with a Monument Pass. 
Originally this Monument Pass was only good for one day. Based upon 
information received during the public collaborative process, the 
Monument decided that this Monument Pass would be good for an 
additional two days at no extra cost. This is consistent with other 
business approaches around the Nation. Disneyland is advertising the 
same concept. When you purchase the pass it will get you in the extra 
days for free, thereby giving them more value to the pass.
    Question. What are some examples of ``showcase'' accessibility 
projects and what types of facilities were these projects developed 
for? What is the cost of these accessibility projects by type? What 
type of cooperative contributions in terms of services or funds can be 
directly related to accessibility projects?
    Answer. The Agency has completed a number of award winning efforts 
in the field of Universal Access, having pioneered guidelines for 
outdoor recreation environments. The focus of this effort was to insure 
that outdoor recreation environments and activities are designed and 
carried out in a manner which is responsive to a diverse country, 
responsive to all ages, abilities, and cultures. At the same time, 
respecting the outdoor environment, and not taking away from this 
diverse user group the adventure, challenge, and enjoyment found in a 
spectrum of outdoor settings. This award winning effort was co-authored 
by the Forest Service and published in the book ``Universal Access To 
Outdoor Recreation: A Design Guide.'' This publication now serves as 
the standard in the federal government and throughout the recreation 
industry for design of outdoor sites, facilities and services. This 
effort itself was completed through partnerships, saving the taxpayer 
about a quarter of a million dollars.
    Similar cooperative projects have been completed in partnership 
with our private service providers, assisting them to develop 
guidelines for their service areas. These products include: Universal 
Access to Outfitting and Guide Services; Universal Access to Ski Areas; 
Universal Access Trail Evaluations; Universal Access to Wildernesses, 
Balancing The American's With Disabilities Act with the 1964 Wilderness 
Act.
    These products have guided the design of new, and the 
reconstruction of existing facilities, and have shaped direction with 
cooperator permits.
    Showcase examples are best found at new installations such as the 
El Portal Visitor Center in Puerto Rico and the South East Visitor 
Center in Ketchican Alaska, where integration of Universal Access is 
simply a way of doing business and at no cost increase, in that it is 
part of the design for the facility. Other examples include sites which 
require retrofitting. This can be costly when replacing facilities. 
However, this can be combined with other reconstruction plans to 
resolve health and safety issues. Examples can be found at areas across 
the country where existing developed recreation facilities are being 
upgraded. While these upgraded facilities may themselves not stand out 
as stellar, to a youngster, parent, or adult who in the past could not 
participate in outdoor recreation activities because basic facilities 
such as restrooms were unavailable, these modest site reconstruction 
activities are indeed life changing and stellar!
    Much of the work getting done locally is through partnerships, 
agreements, by volunteers, and through concessionaire site 
reinvestments. Also, some of the identified projects to be enhanced 
through the Recreation Fee Demonstration Program address accessibility 
items. We do not track costs separately for accessibility 
modifications, and these changes are seldom done alone. It is a part of 
the cost of the entire reconstruction project.
               wildlife and fisheries habitat management
Threatened and endangered species
    Threatened and endangered species programs continue to be critical 
to the agency's mission, but controversial and challenging. The 
administration is requesting a $5.5 million increase in this program.
    Question. The agency budget justification speaks to 
``prioritizing'' candidate plant, wildlife, and aquatic species and 
habitats. Based on agency knowledge of this process, what additional 
plants or animals may potentially be listed as threatened or endangered 
which could have a significant effect on agency programs similar to 
Northern/Western Spotted Owls, Marbled Murellet, etc.?
    Answer. There are 47 species proposed for listing as threatened or 
endangered under the Endangered Species Act that have habitat on 
national forests and grasslands. Twenty-seven of these are plants, most 
with narrow ranges. There are an additional 182 Candidate species for 
which the Forest Service is evaluating the distribution on national 
forest system lands. Species with the most potential to be impacted by 
our management activities such as mineral extraction, timber harvest, 
grazing, or recreation are wide-ranging aquatic species. The proposed 
or candidate species that currently are of greatest concern are the 
bull trout and certain stocks of inland cutthroat trout and chinook 
salmon.
    Question. Are there species of plants or animals [sic] could soon 
be ``de-listed'' which could also have an effect on agency programs?
    Answer. Two species which are moving toward delisting in all or 
part of their ranges are the peregrine falcon and grizzly bear. Several 
plant species have been delisted. After de-listing, the Forest Service 
and the listing agency continue with identified conservation 
responsibilities. Monitoring is required for 5 years following de-
listing. Additionally, close cooperation with the responsible State 
agencies is crucial after de-listing to assure that conservation is 
being achieved. Impacts to the agency will come to a large extent 
through a reduction in the amount of time and effort spent on 
procedural compliance associated with section 7 consultation.
    Question. On March 19 the Supreme Court issued a ruling that people 
whose economic interests are affected by the Endangered Species Act can 
bring suit against the government to stop implementation of actions to 
protect species or plants. How might this ruling affect some agency 
accomplishments, operations, and budget allocations in fiscal year 
1998?
    Answer. There is no way to accurately project the impact of this 
ruling on agency accomplishments, operations, and budget allocations in 
fiscal year 1998. Additional litigation may result, which carries a 
burden of expenses associated with technical support to legal staff as 
well as potential delay of projects associated with conservation of 
species.
           anadromous and inland fisheries habitat management
    A budget increase of $3.9 million is requested for these programs.
    Question. The agency budget justification speaks to emphasis in 
Region 10. What are the principle habitat restoration projects planned 
throughout the Forest Service for these funds? (i.e., increase of $3.9 
million within the anadromous and inland fisheries habitat management 
expanded budget line items.)
    Answer. The increase in funding will be targeted at increasing 
opportunities for public use and enjoyment of inland and anadromous 
fisheries resources. This will be accomplished through habitat 
restoration and enhancement that increases the number of fish national 
forest streams and lakes can produce, and through improvements of 
angler access, fish viewing, and interpretation opportunities. Specific 
examples include:
  --construction of fishways at salmon migration barriers;
  --construction of dams to create fish ponds/reservoirs;
  --liming and/or fertilization of lakes to increase productivity;
  --removing or stocking fish in cooperation with states;
  --construction of fishing docks/piers and boat launches;
  --installation of interpretive signs and viewing areas; and
  --hosting of National Fishing Week and other aquatic education 
        events.
    The majority of the increase ($2.4 million) is within the inland 
fish habitat management expanded budget line item. Inland fish habitats 
support 90 percent of the 36.5 million days of angler effort on 
National Forest System lands each year. Use of inland fish resources on 
the national forests and grasslands generates about $1.6 billion and 
provides 57,000 jobs. Additional inland fish angling opportunities can 
be provided at a cost of $1-10 per angler visit, while generating local 
economic benefits of about $50 per angler visit.
    The smaller increase ($1.5 million) within the anadromous fish 
habitat management expanded budget line item will primarily be directed 
to Alaska and Great Lake states where cost effective opportunities 
exist to increase recreational, commercial, and subsistence fishing 
opportunities. Although some of the increase will be directed to other 
geographic areas, programs are primarily focused on restoration and 
recovery of imperiled salmon stocks.
    Question. What specific results can be expected from this increase 
in terms of habitat restoration?
    Answer. We estimate that the increase in appropriations will result 
in restoration of: (1) more than 100 miles of inland fish stream 
habitat; (2) about 900 acres of inland fish lake habitat; and (3) 
nearly 100 miles of anadromous fish stream habitat.
    Question. How has agency involvement in National Fishing Week 
changed since the program began?
    Answer. The Forest Service has historically led all Federal 
agencies in the number of events hosted during National Fishing Week. 
The program is immensely popular with the public we serve and provides 
a unique forum to: convey a message about the importance of ensuring 
the health and productivity of streams and lakes; share our commitment 
to increasing recreational fishing opportunities; instill a shared 
sense of ownership and responsibility for management of public waters; 
and to build and strengthen partnerships.
    In 1996, the agency and its partners hosted about 321 events that 
were attended by nearly 64,295 people. This represents a slight 
decrease in the number of events hosted, however, while the number of 
participants continues to increase. The decrease in number of events 
hosted is directly related to the decrease in inland and anadromous 
fish appropriations.
                          rangeland management
    The agency received an increase of $6.5 million from fiscal year 
1996 to fiscal year 1997. It is requesting an increase of $7 million in 
fiscal year 1998.
    Question. According to agency explanatory notes for fiscal year 
1997 and fiscal year 1998 there was no change in grazing lands 
considered to be in unsatisfactory condition or in need of further 
analysis (23.5 million acres). Agency budget requests stated that 
increased funds will be used primarily for NEPA evaluation and 
implementation which could be expected to better quantify rangelands in 
unsatisfactory condition. Why has there been no change in this 
classification? What percent of allotments were evaluated in fiscal 
year 1997? With the agency's stated intent to complete the allotment 
evaluation of 2,516 allotments by the end of fiscal year 1998, what can 
the Committee realistically expect regarding funding requests in fiscal 
year 1999 and beyond for the rangeland management appropriation?
    Answer. When the agency's fiscal year 1998 Explanatory Notes were 
prepared the final report on status of National Forest System (NFS) 
rangelands was not complete. The previous year's data were incorporated 
with the intent of substituting current data before final publication. 
Due to an oversight the 1996 data were not inserted into the final 
document. The 1996 data show that 7.8 million acres are not meeting or 
moving towards forest plan objectives and 13.5 million acres need 
further evaluation to determine status, bringing the aggregate to 21.3 
million acres. This is a decrease of 2.2 million acres in these 
categories from 1995. Acreage figures for 1997 will not be available 
until late this fall.
    It is estimated that NEPA analyses will be completed on 805 grazing 
allotments in fiscal year 1997. This represents 32 percent of the 2,516 
analyses scheduled for analysis in Fiscal years 1996-98. NEPA analysis 
were completed on 581 allotments in fiscal year 1996. The sum of fiscal 
year 1996 analyses completed and fiscal year 1997 analyses projected is 
1386, leaving 1,130 analyses to complete in fiscal year 1998 to meet 
the fiscal years 1996-98 objective. The agency will make it's best 
effort to accomplish this task. Several factors will affect the number 
of analyses the agency completes in fiscal year 1998 and future years. 
As analyses are completed more funds are required for implementing 
decisions and conducting project level administration and effectiveness 
monitoring. Increasing complexity of issues is driving up the cost of 
some analyses and ultimately the cost of project implementation, issue 
mitigation, administration and monitoring. If the range budget remains 
stable in fiscal year 1998 and beyond, annual accomplishment of NEPA 
analyses will steadily decrease but acres of rangeland reported in 
satisfactory condition would increase as implementation proceeds.
    It is apparent that the Forest Service will have difficulty meeting 
the first 3 year benchmark of 2,516 NEPA analyses at the requested 
level. More funds must be directed towards implementation, 
administration and effectiveness monitoring as NEPA analyses are 
completed. The Committee can anticipate continued requests for 
additional range management funding until the program provides adequate 
resources to balance resource stewardship and compliance with 
environmental laws.
                         forestland management
    The Administration has requested an increase of $18 million in the 
Forestland Management Program. The timber sale volume to be offered 
will decline by 400 million board feet.
    Question. The Administration requested $14.6 million more for 
timber sales management, than the agency requested. For what specific 
functions will this $14.6 million be used? What specific 
accomplishments will occur?
    Answer. The original request from the agency did not provide for 
full implementation of the President's Plan for the PNW. The additional 
$14.6 million is for funding the President's Plan for the Pacific 
Northwest. fiscal year 1997 was the first year of full implementation 
of the PNW Plan. The additional funding for fiscal year 1998 is to: 1) 
fund the additional harvest administration resulting from meeting the 
volume levels in fiscal year 1997; 2) sustain the full implementation 
level; and 3) reflect the actual cost of meeting requirements of the 
PNW Plan. fiscal year 1997 is the first year that we will meet the 
probable sale quantity (PSQ), and we are now able to determine the 
actual cost of meeting the plan.
    Rather than reduce the fiscal year 1998 agency requested 
allocations to regions and forests not covered by the PNW Plan, the 
Administration chose to maintain those levels and to request an 
additional $14.6 million to fully implement the PNW Plan.
    The additional $14.6 million will provide an additional 140 million 
board feet of timber offered for sale from forests covered by the 
President's Plan for the PNW.
    Question. The Administration increased timber sales management 
funds by $14.6 million, and salvage funds by $3.0 million over the 
agency request. However it reduced the agency's request for road 
construction funds by 19.2 million, and reduced the agency road 
maintenance request by 7.7 million. In light of this action, how will 
the agency modify it's planned timber program to meet it's timber sale 
target?
    Answer. Funds for timber roads are adequate to administer road work 
on existing sales and to prepare surveys and designs for the green sale 
program of 2.5 BBF in fiscal year 1998. The shift of funds from road 
construction made by the Administration to balance competing resource 
priorities will affect our ability to conduct engineering support in 
planning for the transportation needs for future timber sales beyond 
fiscal year 1998.
    The roads support for salvage sales is funded from salvage sale 
funds, thus that program is not affected by the reduction of road 
funds.
    The reduction in road maintenance funding will not affect the 
timber program, but will reduce our ability to manage and maintain the 
permanent road system.
    Question. The agency has a timber sell target of 4.18 billion board 
feet in fiscal year 1997. Is this volume actually selling? Please 
provide a comparison of the volume offered to the volume sold for 
fiscal years 1994-96.
    Answer. The timber volume of 4.18 billion board feet for fiscal 
year 1997 is actually our planned volume to be offered for sale given 
the available funding. The intent of the Forest Service is to sell all 
the volume that is offered. However, market conditions influence 
whether people are willing to purchase all timber sales. About 13 
percent of the volume offered over the last three fiscal years was not 
sold. The following table shows each fiscal year.

                              TIMBER VOLUME                             
                     [Volume in billion board feet]                     
------------------------------------------------------------------------
                                               Fiscal year--            
                                  --------------------------------------
                                       1994         1995         1996   
------------------------------------------------------------------------
Volume offered...................         3.41         4.01         4.02
Volume sold in year of offer.....         2.56         2.49         2.45
Volume sold following fiscal year          .40          .81      \1\ .78
Long-term contract volume                                               
 released \2\....................          .18          .14          .19
                                  --------------------------------------
      Total sold/released........         3.14         3.44         3.42
Volume not sold..................          .27          .57          .60
Percent of offer not sold........            8           14           15
------------------------------------------------------------------------
\1\ Through March 31, 1997.                                             
\2\ Volume released from long-term contracts in region 10 is not counted
  toward sold volume since this volume was previously recorded as sold  
  in the 1950's when the contracts were initiated.                      

    Question. The Independent Forest Products Association states that 
the proportional amount of sawtimber sold as a percentage of total 
timber sold, is decreasing substantially. What percent, for the past 5 
years of the total volume accomplishment, has been from saw timber and 
what percent has been from other products? Please be specific regarding 
the other products.
    Answer. The table below provides our data related to this question, 
which comes from the Automated Timber Sale Accounting System. As can be 
seen, there has been no substantial decline in the proportion of 
sawtimber versus the total volume sold over the past 5 years. Other 
products, besides sawtimber, that are sold include the categories of 
pulpwood, poles, pilings, posts, fuelwood, excelsior wood, cooperage 
bolts, miscellaneous, and cull logs. The highest volume categories of 
other products are provided in the table.

                                   HIGHEST VOLUME CATEGORIES OF OTHER PRODUCTS                                  
                                              [All volumes in MMBF]                                             
----------------------------------------------------------------------------------------------------------------
                                              Volume sold                       Other products volume sold      
                                         ---------------------  Percent  ---------------------------------------
               Fiscal year                                     sawtimber                                   All  
                                          Sawtimber    Total              Pulpwood  Fuelwood    Cull      other 
----------------------------------------------------------------------------------------------------------------
1992....................................      2,688     4,458       60.3     1,134       381       108       147
1993....................................      2,672     4,515       59.2     1,108       445        80       210
1994....................................      1,578     3,056       51.6       936       343        49       150
1995....................................      1,448     2,885       50.2       877       303        39       218
1996....................................      1,943     3,384       57.4       746       247        33       415
----------------------------------------------------------------------------------------------------------------

    Question. What is the status of implementation of the General 
Accounting Office recommendations regarding timber theft prevention?
    Answer. It was the Office of Inspector General of the Department of 
Agriculture that conducted a review of timber theft problems in the 
National Forests. The recommendations of the audit have been 
implemented and the Office of Inspector General has closed the audit.
    Question. The agency operates a total of 11 nurseries which are 
funded through the working capital fund. With the combined production 
of seedlings declining by 38 percent, how have the costs of maintaining 
these nurseries been affected?
    Answer. As Working Capital Fund (WCF) facilities, Forest Service 
nurseries must annually establish a selling price for seedlings that 
covers the production costs associated with growing the seedlings. 
Declining production levels at Forest Service nurseries have resulted 
in higher seedling costs because the fixed costs of running these 
facilities must be absorbed by a reduced level of seedling orders. Any 
cost increases are ultimately borne by the customer in the price they 
pay for the seedlings grown at these facilities. Because of this, 
Forest Service nursery managers work hard to hold the line on selling 
price increases. In recent years they have been doing this by reducing 
personnel at these facilities and by seeking ways to increase the 
efficiency of their operations. These efforts have helped to keep cost 
increases to a minimum. For example, the J. Herbert Stone Nursery 
charged $185 per thousand for 2-0 bareroot conifer seedlings in fiscal 
year 1994. This selling price increased to $186 per thousand in fiscal 
year 1995, and rose to $198 per thousand in fiscal year 1996. This 
equates to a 7 percent rise in selling prices despite a decline in 
seedling production of roughly 47 percent (from 21.2 million seedlings 
in fiscal year 1994 to 11.3 million seedlings in fiscal year 1996). 
Despite the decrease in production, the nursery managed to cover 
production costs without pricing itself out of the market.
    The Agency is committed to maintaining cost-efficient nursery 
operations. In December, 1995, following a careful analysis of 
anticipated future seedling orders at 7 Forest Service nurseries in the 
Western U.S., the decision was made to close 3 of these facilities by 
the year 2000. We believe that this action, coupled with other measures 
to maintain cost-effective nursery operations, will provide for a 
National Forest Nursery System that is well-tailored to meet resource 
management needs for the foreseeable future.
    Question. The agency states that combined production of bareroot 
seedlings and containerized stock will be reduced by 38 percent from 
fiscal year 1997 to fiscal year 1998 primarily due to the reduced 
timber program. In order to reduce operating costs and fully utilize 
nursery capacity, can cooperative work with states and private 
operators result in improved reforestation on state, private, and local 
government lands?
    Answer. Yes, we believe it can. The Granger-Thye Act of 1950 
provides for the sale of forest-tree seed and nursery stock to States 
and political subdivisions in each State. This Act prohibits the sale 
or exchange to these entities of ornamental or other stock for 
landscape planting of types commonly grown by established commercial 
nurseries. To varying degrees, all of our nurseries are working with 
other Federal and State agencies to more fully utilize nursery capacity 
and to provide for the growing stock needed by other governmental 
entities. In fiscal year 1996, Forest Service nurseries produced about 
4.8 million bareroot seedlings for other agencies, representing about 8 
percent of all bareroot production nationally. The percentage of 
seedling orders grown for other agencies in relation to total seedling 
production has risen over the past few years at most Forest Service 
nurseries.
    Question. Does the Forest Service mutually cooperate with State 
Foresters in the use of respective nurseries for the growth of planting 
stock? If so, what is the number of nurseries and the amount of funds 
involved in cooperative efforts?
    Answer. The Forest Service cooperates with State Foresters and U.S. 
Territorial forestry agencies mainly by providing technical and 
financial assistance through its State & Private Forestry (S&PF) 
programs. Funding for the S&PF Seedling, Nursery, and Tree Improvement 
Program totalled $2.659 million in fiscal year 1997. These funds were 
used to provide technical and financial assistance to 69 State and 4 
Territorial nurseries which produced 396 million seedlings in 1995 (the 
most recent year national data is available). Additional technical 
assistance to these nurseries was provided by the Forest Service's 
National Tree Seed Laboratory in Macon, Georgia. The Laboratory 
provides seed-testing services, serves as a seed bank for national and 
international research needs, and provides technical information and 
training on all aspects of forest tree and shrub seed harvesting and 
utilization. Funding for the National Tree Seed Laboratory was $263,000 
in fiscal year 1997.
    State nurseries sell only small amounts of seedlings to the Forest 
Service. Many State nurseries are prohibited from submitting bids on 
these contracts by State statutory or regulatory requirements. Market 
conditions also play a factor. Many State nurseries have recently been 
operating at or near full capacity to supply seedlings for non-Federal 
customers.
    Question. The Congressional Budget Office estimates that 
eliminating deficit timber sales would save $185 million in federal 
funds over a 5-year period. The General Accounting Office states that 
deficit timber sales occur in 3 of 9 regions. Based on the GAO 
methodology, what would be the impacts of eliminating timber sales that 
fail to produce income in excess of preparation costs.
    Answer. The study we believe is being referred to in the question 
is the 1995 GAO Report entitled ``Forest Service--Distribution of 
Timber Sale Receipts fiscal years 1992-94.'' That study had a very 
specific objective, namely to compare the costs of sale preparation 
with the sale revenues returned to the General Fund of the U.S. 
Treasury. Consistent with this goal, in determining when a deficit 
situation existed, the study did not count as income either purchaser 
road credits, or purchaser deposits for such things as reforestation, 
road maintenance, and brush disposal. According to the figures in that 
study, only about 10 percent of all National Forest timber sale 
receipts ultimately end up in the General Fund--the other 90 percent 
are either not received in the form of cash (e.g., purchaser road 
credits), or goes into some special Congressionally authorized account 
(e.g., the K-V and NFS funds). The Forest Service has not based the 
benefits of selling National Forest System timber soley on revenues 
returned to the U.S. treasury. Some important reasons why are:
    National forest timber sales are not only a means of producing 
fiber to help meet the nation's demand for wood, they are also an 
important tool for managing national forest ecosystems. It is vital to 
recognize that national forest timber is sold and harvested for 
essentially three reasons:
    1. To help meet the nation's demand for wood, thereby reducing 
pressures on private forest lands and the need for foreign imports. 
Sales made primarily for this purpose are called ``timber purpose'' 
sales.
    2. To help achieve non-timber management objectives that require 
manipulating the existing vegetation--e.g., reducing forest fuels, 
improving forest health, and creating habitat desired by certain 
species of wildlife. Sales made primarily for this purpose are called 
``forest stewardship'' sales.
    3. To provide fuelwood, posts, Christmas trees, and other forest 
products to individuals for their own use. Sales made primarily for 
this purpose are called ``personal use'' sales.
    Most below-cost timber sales fall into the last two of the 
preceding categories. Accordingly, one important effect of eliminating 
such sales is that we would greatly compromise our ability to use 
timber sales as a tool for achieving various land stewardship goals. 
This would almost certainly be detrimental for the Federal Treasury as 
well. Often the net costs (i.e., revenues--expenditures) associated 
with using other treatment options (e.g., prescribed burning, use of 
chemical herbicides, or cut and leave) are greater than those 
associated with using a timber sale because these other options do not 
generate any revenue to help offset the costs of their application.
    National forest timber sales are important to the economies of many 
local communities, especially in the western U.S. The latest Timber 
Sale Program Annual Report (i.e., TSPIRS Report) shows that between 
fiscal year 1991 and fiscal year 1995, the number of jobs supported by 
the harvesting and processing of national forest timber dropped by 38 
percent--from 103,151 jobs to 63,623 jobs. During this same period, the 
timber sale program's estimated contributions to regional income and 
federal tax receipts also fell--in these instances by 58 percent. 
Specifically, regional income is estimated to have dropped from $5.3 to 
$2.2 billion, and federal tax revenues from $749.4 to $336.8 million. 
To some degree these economic impacts have undoubtedly been offset by 
increased harvesting from private forest lands, but to the extent that 
this has occurred--most of the beneficiaries are in the South, not in 
the West. Eliminating deficit timber sales will only compound the 
economic and social hardships that now confront many rural western 
communities.
    National forest timber cannot always be priced at a level high 
enough to cover the agency's costs of production. The Forest Service, 
as a matter of law and policy, assumes many costs not incurred by 
private timber producers: adhering to stricter regulations for 
environmental assessment and analysis; involving the public in sale 
planning and allowing for administrative appeals. At the same time, 
however, we sell our timber in an open market where most purchasers 
have a choice of buying either from public or private sources. So, 
should we decide that national forest system must be priced to fully 
cover production costs, the result will be that we price ourselves out 
of the market. This could result in paying higher costs to manage 
timber stands for stewardship objectives than we would spend using 
timber harvest as a management tool.
    Question. What is the current status of pipeline timber sale 
volume? How much volume planned for sale in fiscal year 1998 is 
currently completed through the NEPA process? Is the overall status of 
the pipeline sufficient to assure accomplishment of the future planned 
timber sale program?
    Answer. As of March 31, 1997, there is approximately 1.3 billion 
board feet of timber sale volume prepared through the NEPA process for 
future years. NEPA documentation has been completed on 800 million 
board feet of timber volume for the fiscal year 1998 timber sales 
program. The agency goal in timber sale pipeline is to have about 70 
percent of NEPA work completed and a substantial amount of the field 
layout completed for the fiscal year at the start of the fiscal year. 
This would require having about 2.7 billion board feet through NEPA at 
the start of fiscal year 1998. Currently about 30 percent of the 
desired pipeline volume for fiscal year 1998 sales is through NEPA.
    Question. Many ``other'' forest products are sold by the Forest 
Service. These include mushrooms, bear grass, mosses, etc. What is the 
value of these products in terms of income for the past 5 years? Do 
sales of these products affect timber volume offered targets?
    Answer. The following table displays the total value of 
miscellaneous non-convertible forest products and Christmas trees. Non-
convertible forest products represent such items as; mushrooms, 
transplants, vines, pine straw bear grass, mosses, and many others. It 
does not include products that can be converted to a volume estimate 
such as, fuelwood, posts, poles.

Value of miscellaneous nonconvertible forest products and Christmas 
trees

Fiscal year:                                                In thousands
    1996......................................................  $3,261.8
    1995......................................................   2,935.1
    1994......................................................   3,138.3
    1993......................................................   2,791.4
    1992......................................................   2,423.0
                    --------------------------------------------------------------
                    ____________________________________________________

      Total...................................................  14,549.6

    As a whole, these special forest products are a 
considerable business in many locales. The sales of these 
products do not directly affect the timber volume offered. 
However, the cost associated with administering this business 
is included in the timber sales management line item.
    Question. In recent years a significant number of highly 
qualified and seasoned timber sale administrators left the 
agency. What has been done to replace these needed skills? In 
some regions of the country, this critical task is performed by 
employees with temporary appointments. Has FTE ceiling 
prohibited the permanent placement of employees in timber sale 
administration functions?
    Answer. The Forest Service has lost many skilled sale 
administrators as a result of the decrease in the size of the 
timber sale program and through downsizing the overall 
workforce. In many cases, people with less experience have 
taken over these responsibilities. Forests and regions have 
increased the training programs for sale administrators to 
assure people administering sales have the skills they need. 
Depending on what happens to the size of the sale program, we 
could face a problem in the future with having enough trained 
and experienced people to carry out the program. At this point, 
the budget is the driving force, not FTE ceilings, in limiting 
the size of the sale administration staffs.

      liability for suspended and cancelled timber sale contracts

    The Forest Service has incurred considerable liability for 
timber sale contracts which have been suspended or cancelled 
because of threatened or endangered species. Two instruments 
are available that would limit the Forest Service's future 
liability for timber sale contracts that need to be suspended 
or cancelled because of threatened or endangered species--(1) 
regulations which state the settlement timber purchasers' are 
entitled to when a timber sale contract is suspended or 
cancelled because of threatened or endangered species and (2) a 
new timber sale contract that specifies settlement in these 
situations and provides the Forest Service more flexibility to 
modify contracts and delete timber areas affected by threatened 
or endangered species. Since the late 1980's, the Forest 
Service has been working on revising these two instruments, yet 
work is still incomplete.
    Question. Does the Forest Service intend to publish 
proposed regulations on the settlement that will be provided 
when timber sale contracts are suspended or cancelled because 
of threatened or endangered species? If so, when?
    Answer. The Forest Service published a proposed rule 
concerning contract cancellations on December 30, 1996. The 
comment period ended on February 13. Presently, the comments 
are being analyzed to determine what the final rule might be.
    Question. Does the Forest Service have a plan to issue for 
public comment a revised timber sale contract? If so, when?
    Answer. The Forest Service plans on publishing a proposed 
contract for public comment this coming summer. Presently, the 
proposal is being reviewed by OMB.

                          timber salvage sales

    The salvage program will involve the preparation of 1.3 
billion board feet, as part of the overall timber offer target 
of 3.8 billion.
    Question. The report titled ``Interagency Salvage Program 
Review'' discussed collaborative efforts by the Forest Service, 
Bureau of Land Management, National Marine Fisheries Service, 
Environmental Protection Agency, and the Fish and Wildlife 
Service relative to accomplishments under the Rescissions Act. 
The report found the definition of salvage was not clearly 
defined and that in the case of the Forest Service, there was a 
tendency to broadly label sales as salvage in order to capture 
funds for forest-health related activities. The report 
recommendations state that the Forest Service and BLM should 
establish an interagency group to define salvage for use 
following the Rescissions Act. What is the status of this 
recommendation? What potential effect could this initiative 
have on the current definition of salvage as used by the Forest 
Service today?
    The report also addressed the need for continued 
collaboration between agencies as the cumbersome timber sale 
planning and preparation effort proceeds. What efforts will the 
Forest Service make to assure such collaboration in the future 
with expiration of mandates such as the Rescissions Act?
    Answer. The interagency team has developed a draft action 
plan associated with the review report you cite, and the 
agencies are currently evaluating the draft action items. With 
respect to the salvage definition, there have been various 
options developed in association with the proposed Forest 
Ecosystem Restoration and Maintenance (FERM) fund. Those 
options range from using the current definition to one which 
would only include dead or dying trees. Any change in the 
definition or the way it is applied and/or any limitations 
applied to the salvage sale fund will have a direct effect on 
the amount of salvage volume sold. The primary objectives of 
reviewing the salvage definition, as outlined in the review 
report, are to ``* * * ensure that the intent of projects will 
be clearly articulated to the public * * *'' and to ``* * * 
consider criteria for identifying salvage situations where 
there is a need to expedite the sale preparation process'' 
(page 17). The agencies are continuing to evaluate the 
definition options and work towards implementation of this 
recommendation.
    The Rescissions Act itself did not mandate interagency 
collaboration. The collaborative processes were established 
through the Administration's Interagency Memorandum of 
Agreement (MOA) in response to the requirements of the Act. In 
fact, the interagency processes of early collaborative 
involvement used in the MOA were initially implemented under 
the Pacific Northwest Forest Plan and were well underway before 
the passage of the Act. The MOA helped to expand interagency 
collaboration beyond the Pacific Northwest. The Forest Service 
and its sister agencies are continuing to refine these ongoing 
processes to assure efficient and effective project planning.
    The report also addressed the need for continued 
collaboration between agencies as the cumbersome timber sale 
planning and preparation effort proceeds. What efforts will the 
Forest Service make to assure such collaboration in the future 
with expiration of mandates such as the Rescission Act?
    Question. The GAO report (GAO/RCED-97-53) on salvage sale 
accomplishments under the Rescissions Act, states that the 
agency ``does not know whether the current estimate of salvage 
timber capable of being harvested is more or less than the 
previous estimate of 13 billion board feet, which was 
previously estimated as the accessible timber for harvesting.'' 
Does the agency now have an estimate of their backlog 
inventory?
    Answer. The Forest Service does not routinely track the 
amount of merchantable volume that could be salvaged. The 
estimates noted by the GAO in their report were calculated for 
an effects statement on the emergency salvage bill when it was 
initially proposed. The estimates were obtained from individual 
national forests responding to a series of hypothetical 
situations (e.g., what amount of merchantable salvage timber 
would be available for harvest if Forest Plan standards and 
guidelines weren't incorporated into sale design?).
    Question. The GAO report states that provisions of the Act 
designed to expedite the sale of salvage sales had little 
affect on the timetable. If this is true, what factors allowed 
the agency to make these accomplishments?
    Answer. Many of the sales covered by the Rescissions Act 
were well into the sale preparation process when the Act was 
passed. As a result of the intense fires during the summer of 
1994, the agency had already placed a high priority on timber 
salvage. In addition, severe storms during the winter of 1995/
1996 and more fires during the summer of 1996 added to the 
salvage opportunities. In some cases, excluding administrative 
appeals and limiting judicial review decreased time frames. In 
other cases, the controversies resulted in more litigation than 
is normally experienced. Based upon experience of the national 
forests reviewed by GAO, few appeals or legal challenges 
normally occur when selling salvage timber.
    Question. When will the expected Administration proposal to 
divide the salvage sale fund into two parts be received? What 
effect will this proposal have on salvage sale volume sold?
    Answer. We do not have an anticipated date for transmitting 
the proposal. Various options are being reviewed, including 
administrative changes to current programs. The fiscal year 
1998 budget was developed with a given volume planned to be 
prepared and offered for sale. There are no plans to change 
this volume unless our final appropriation is different from 
the President's budget request.
    Question. An agency briefing paper on the new Forest 
Ecosystem Restoration and Maintenance Fund, states that funds 
will be used to finance those management activities that are 
identified as being of high priority for ecosystem restoration 
and maintenance. How does this compliment or conflict with the 
ability to perform work of this nature through the KV program?
    Answer. KV expenditures are: (1) limited to the timber sale 
from which they were collected, (2) dependent on sufficient 
revenues being generated by the sale to finance the activities, 
(3) limited to projects within the timber sale area boundary, 
and (4) available for up to 5 years from sale closure. 
Activities accomplished from the proposed Forest Ecosystem 
Restoration and Maintenance Fund would not be subject to these 
restrictions and would compliment the use of KV on lands not 
associated with a timber sale.
    Question. Will timber be sold as part of management 
activities performed from this new fund?
    Answer. Final decisions have not been made as to what 
legislation will be proposed and the activities to be included.
    Question. Over the past 20 years the importance of the 
salvage timber program has increased significantly when 
compared to the green timber program with regard to the volume 
of timber offered for sale. For example, in fiscal year 1977 
the volume of salvage timber harvested was less than 8 percent 
of the total volume of timber harvested by the Forest Service, 
while in fiscal year 1996 the volume of salvage timber 
harvested was almost 50 percent of the total volume of timber 
harvested by the Forest Service. What has the Forest Service 
done to accurately determine the volume of salvage timber on 
national forest lands that can be offered for sale? What type 
of salvage volume inventory, if any, of salvage timber does the 
Forest Service maintain?
    Answer. Salvage has become an important component of the 
timber program on a percentage basis. The annual amount of 
salvage is determined by each field unit following events which 
kill or weaken trees, such as insect epidemics, fires, 
windstorms, and snow damage. Once the damage is determined, 
salvage sales are based on these salvage opportunities. Each 
``opportunity'' must have sufficient salvage present to prompt 
a salvage sale effort. The actual salvage volume included is 
the amount that can be economically removed and still meet 
other environmental considerations such as riparian, wildlife, 
and visual needs. Additionally, in a regular green sale there 
are usually incidental amounts of salvage that are marked and 
included for harvest if they are not needed for other 
environmental purposes. Salvage efforts also vary depending on 
market factors. When there is a depressed market for small logs 
and chip material, we do not prepare this size salvage for 
sale. Field units continually survey for dead and damaged 
timber as a normal part of management. However, there is not an 
inventory of salvage because when a salvage opportunity is 
identified, it is addressed quickly to prevent deterioration of 
the products involved.

                   president's northwest forest plan

    Questions. The jobs-in-the-woods program as addressed in 
the President's Northwest plan speaks to the performance of 
``short-term jobs * * * to restore the region's watersheds to 
environmentally sustainable conditions.'' (a) What is the 
inventory of such projects? (b) How do wages for these projects 
equate wages that displace forest products workers had 
previously received? (c) Does the jobs-in-the-woods program 
delay what is ultimately the economic demise of the small rural 
communities of the Northwest due to reduced timber productions?
    Answers. (a) Restoration needs and priorities are 
identified when watershed analyses are completed. Thus, the 
inventory of needs continues to grow as more and more analyses 
are completed. At current funding levels, we estimate at least 
10 years of priority restoration needs have been identified. 
Large natural events can and have increased overall needs for 
watershed restoration (e.g., Northwest flooding in 1996 and 
1997) compared to the initial watershed analyses. The project 
planning aspects (specifications, etc.) of these needs are 
completed 12-18 months ahead of implementation given current 
staffing and funding. (b) The analysis for the jobs-in-the-
woods program for fiscal year 1995 indicated that the average 
wage and benefit for workers in the program was approximately 
$17.50 per hour. While this level exceeds the states' 
definition of a ``family wage'', it is below the level 
historically paid to primary timber workers. A primary 
difference between the two is the level and extent of benefits 
received. While the total compensation is below the historical 
level, this program has enabled workers to remain in their 
communities and obtain livelihoods by working in the woods. (c) 
Absolutely Not! The jobs-in-the-woods program for the Forest 
Service has been a $14-16 million a year program. Except for 
the first year, fiscal year 1994, this program has not involved 
new money. The overall magnitude/significance of injecting $14-
16 million of funds into communities (over 500 residents) 
across the area of the NW Forest Plan has not been at a level 
that would prevent the ``economic demise'' of these 
communities.
    However, there has been three significant aspects of the 
jobs-in-the-woods program: (1) Jobs-in-the-woods program has 
provided the opportunity for many communities to develop new 
and improved skills for restoration related work so that they 
can locally respond to future restoration needs. (2) Jobs-in-
the-woods has enabled the agency and the communities to better 
understand, appreciate, and capitalize on the opportunities to 
improve the quality of local jobs across all programs areas by 
working collaboratively. It's no longer simply how we use the 
jobs-in-the-woods funding to improve quality of jobs, but 
rather, how we design and manage our overall programs to best 
utilize and capitalize on the skills and abilities of local 
workers. (3) Jobs-in-the-woods is only one program within the 
Northwest Economic Adjustment Initiative assisting communities 
in transition. In conjunction with jobs-in-the-woods, the 
Forest Service has fully utilized its Rural Community 
Assistance program to assist communities to diversify their 
economic conditions. Some of this economic diversification has 
been aimed at bringing in completely new businesses but also 
has been aimed at designing new economic opportunities 
associated with the new natural resource management policies--
e.g., creating new industries for small diameter products, 
utilization of special forest products, tourism, new recreation 
opportunities, etc. But the eventual success of these 
initiatives are generally dependent upon healthy watersheds. 
Both of these programs have provided the tools and wherewithal 
to assist in this transition (both programs working hand-in-
hand) and the agency and communities are making the best out of 
them. If the watershed restoration/jobs-in-the-woods program 
was eliminated, it would cause additional and immediate 
economic problems to these affected communities with the loss 
the jobs associated with this level of financial investment (as 
would be the case of the elimination of any economic activity). 
But more critical is the loss of ability for the agency to 
restore and/or maintain the health and vitality of these 
watersheds. Without an active restoration program full recovery 
will be significantly delayed and will affect the local 
communities' ability to derive economic opportunities that are 
associated with healthy watersheds.
    Question. The agency will offer 763 mmbf as part of the 
President's Northwest Forest Plan. This volume (except that 
being offered by Region 5) is included in the planned total 
Region 6 planned offering of 1.025 bbf. Is this target on 
track?
    Answer. The 763 mmbf you reference includes the probable 
sale quantity (PSQ) of 694 mmbf plus 10 percent ``other wood'' 
as defined by the Pacific Northwest Forest Plan. The Region 6 
portion of the estimated volume is 586 mmbf (533 mmbf in PSQ 
plus 10 percent other wood). The 586 mmbf is included in the 
1.025 bbf planned offering for all of Region 6. At this time, 
the sale preparation work is on track and the region expects to 
offer the full 1.025 bbf in fiscal year 1997.
    Question. The document entitled ``The Northwest Forest 
Plan, A Report to the President and Congress,'' dated 12/96 
cites examples of cooperation between the Forest Service, 
Bureau of Land Management, and the Fish and Wildlife Service, 
that helped reduce the required Endangered Species Act 
consultation from 114 days to 30 days in the area covered by 
the Plan. Is this same degree of cooperation occurring 
elsewhere in the United States for specific species which are 
affecting timber sales and other management actions? Has this 
cooperation had an affect on the appeals process? What action 
is being taken to ``institutionalize'' this degree of 
cooperation outside the Pacific Northwest?
    Answer. The streamlined consultation process has been a 
success. Where the teams focused on early interagency 
involvement, cooperated fully and were supported by decision-
makers in their efforts, timeframes were greatly reduced and 
the resulting projects were better designed. In the summary 
produced for fiscal year 1996 by the Interagency Streamlining 
Consultation Group for Oregon, Washington, Idaho, Montana, and 
California, informal consultations were completed between one 
and 30 days with the an average of 17 days. Formal 
consultations were completed between one and 71 days, with an 
average of 46.5 days.
    Elsewhere in the country the consultation process varies in 
timeframe. In the Southeastern Region informal consultation 
averages about 30 days and formal consultations may take 4 
months. Outside the northwestern states consultation times are 
not specifically tracked.
    The Forest Service is engaged in a number of important 
interagency efforts related to consultation. An interagency 
Memorandum of Agreement is being prepared for streamlining 
program level consultations. This will save time and effort and 
lessen the need for additional formal consultations on projects 
such as timber sales and grazing permits. Additionally, the 
continued work of the interagency streamlined consultation 
teams in several regions has reduced timelines for consultation 
while assuring better designed projects. Our interagency 
cooperation, because it results in better designed projects, 
should reduce the need for appeals. However, the agency would 
have to design a systematic method to track and analyze this 
over time.

                    soil, water, and air management

    The Soil, Water, and Air Management program is proposed for 
an increase of $7.6 million including $2.5 million for 
operations and $5.1 million for improvements.
    Question. What impact has the harsh weather in the West and 
Midwest had on the planned Soil and Water Program? How might 
this affect the scope of the budget request for fiscal year 
1998 and 1999?
    Answer. The extensive rain, snow, wind, and flood damage in 
the West and Midwest will require Forests to adjust many work 
priorities for the coming fiscal years. If emergency 
supplemental funding authorizations fall short of identified 
needs, normal program funds will be re-directed to address 
pressing repair needs to bring the Forests back to full public 
safety. This will require Forests to delay normal programmed 
watershed improvements into future years. Similar adjustments 
may also occur in related programs such as wildlife and 
fisheries, recreation, and engineering.
    Question. How has the program been affected by water rights 
adjudication issues? Has the cost of involvement in and support 
to adjudication issues resulted in less attention to other 
resource management issues?
    Answer. The Forest Service is a water user and a party in 
44 adjudications in 8 western States. About 14 percent of the 
total Soil Water and Air (NFSO) Expanded Budget Line Item 
(EBLI) has been used to pay for associated water adjudication 
activities in recent years.
    Adjudication issues have diverted time, staffing, and 
resources away from other resource management issues in regions 
where water right adjudications are active. Cost for 
adjudications are multi-function financed, using the 
benefitting function concept. In most adjudications, the NFSO 
EBLI pays 50 percent; the remaining 50 percent is normally 
spread among recreation, timber and wildlife/fisheries 
accounts.
    Question. The interagency initiative to reclaim abandoned 
mines will focus on watersheds in Colorado and Montana. What is 
the inventory of other such projects throughout the United 
States? What is the specific cost of the three projects 
mentioned for which the fiscal year 1998 increased funding will 
be used?
    Answer. Of the approximately 38,000 abandoned and inactive 
mine sites on lands managed by the Forest Service, we estimate 
that about 4,100 sites contribute to non-Comprehensive 
Environmental Response Compensation and Liability Act (CERCLA), 
water quality problems. This figure may increase slightly when 
our inventory is completed in fiscal year 1998.
    Working in concert with states and other initiative 
partners, we are prioritizing watersheds to be addressed as 
funding becomes available. While figures are incomplete at this 
time, we estimate that Colorado and Montana will both receive 
about $2 million to finalize preparatory work and institute 
cleanup projects.
    The Forest Service and its USDI partner agencies have 
tentatively chosen Arizona as the third state in which to begin 
this program. While a final figure is not definite at this 
time, we estimate the preliminary work in the the third state 
will require between $500,000--$600,000 to Arizona to begin 
assembling relevant data, working with partners to delineate 
and prioritize watersheds, and begin needed water quality 
assessments prior to remediation efforts.
    Question. What specific changes are planned in this program 
as a result of storm damage in the West over the past 2 years?
    Answer. To respond to storm damages, resource professionals 
will shift work priorities into project design and contract 
administration. This will cause a de-emphasis on watershed 
analysis and input to other project work to some degree.
    Watershed improvements will focus on problems causing 
direct and indirect effects on riparian areas, anadromous and 
other key fisheries, habitat for Threatened and Endangered 
species, and watersheds not meeting state water quality 
standards.
    Watershed professionals will use knowledge gained from the 
recent flood events to assess cause/effect relationships 
between land management practices and damages, and work to 
revise management to minimize future problems.
    Watershed professionals are currently planning a specific 
effort to streamline methods to more quickly and efficiently 
evaluate damages and repair needs from floods and other natural 
disasters, provide consistent interpretation of findings, and 
coordinate with other agencies and local officials. This 
process will have strong parallels to our highly successful 
Burned Area Emergency Rehabilitation (BAER) program that deals 
with results of severe wildfires.
    In order to repair damages from severe storms in the Winter 
of 1995-1996, Congress appropriated $87.4 million in fiscal 
year 1996. The Forest Service allocated these funds to seven of 
nine Regions to perform a wide range of repair activities 
including watershed restoration, fisheries habitat repair, road 
and trail reconstruction, repair of recreation facilities, and 
similar actions. Request for additional emergency supplemental 
funds are currently before Congress to repair damages from 
storms over the 1996-1997 winter.

                          minerals and geology

    Question. What significant litigation has occurred in 
recent years regarding liability relative to abandoned mines on 
National Forest System land?
    Answer. The Forest Service has been involved in three 
significant cases related to abandoned mines on National Forest 
System land. These cases involved claims by the United States 
against potentially responsible parties for environmental 
damages and cleanup costs pursuant to the Comprehensive 
Environmental Response, Compensation, and Recovery Act (CERCLA) 
and other applicable environmental laws. The three cases are as 
follows.
    Shiny Rock (Amalgamated) Mill Site.--In May 1997, the 
United States Department of Justice (DOJ) filed a Consent 
Decree related to the Shiny Rock (Amalgamated) Mill Site in 
Oregon. The Consent Decree will require Persis Corporation to 
conduct a remedial action, including removal of tailings 
deposited adjacent to Battle Ax Creek, upstream of the water 
supply of Salem, Oregon. The site is located in the recently 
designated Opal Creek Scenic Recreation Area. Persis 
Corporation is the parent corporation of Shiny Rock Mining 
Company, which controlled the site and the surrounding area 
from 1973-1992.
    Bunker Hill Superfund Site.--In March 1996, DOJ filed suit 
in federal district court on behalf of the United States 
Department of Agriculture (USDA), the United States Department 
of the Interior (DOI), and the United States Environmental 
Protection Agency (EPA) against eight mining companies for 
extensive environmental damage in the Coeur d'Alene Basin in 
Northern Idaho. The suit, known as United States v. ASARCO et 
al., was brought under CERCLA and the Clean Water Act (CWA) 
both for natural resource damages and cleanup costs. The 
complaint alleges that decades of mining and smelting activity 
in the Coeur d'Alene basin and at the Bunker Hill smelting site 
have resulted in extensive environmental damages to the natural 
resources of the region, including wildlife, soils, and 
vegetation. The Coeur d'Alene Indian Tribe has also filed suit 
and joined the United States as a co-plaintiff in the 
litigation. The litigation itself is in the discovery stage and 
no trial date has been set yet by the Court.
    Blackbird Mine Site.--This litigation was initiated in 1983 
by the State of Idaho, who sued the owners of the Blackbird 
Mine under CERCLA and state laws. In 1990, the current owners 
of the Blackbird Mine, the Blackbird Mining Company, sued past 
owners and operators and also named DOI and USDA as third party 
defendants. In 1993, the United States sued the Blackbird 
Mining Company and previous owners and operators of the site 
under CERCLA, the CWA, and the Endangered Species Act. The 
United States' action and the State of Idaho's action were 
consolidated soon thereafter. In 1994, the United States 
District Court for the District of Idaho ruled in favor of the 
United States and the State of Idaho, finding the past and 
current mine owners and operators liable, while dismissing all 
claims against the Forest Service. In April 1995, the federal 
government reached an agreement with the mining companies in a 
Consent Decree covering both response actions and natural 
resource damages. The mining companies are conducting an 
``Early Action'' response action at Blackbird Mine pursuant to 
an Administrative Order on Consent (AOC) negotiated with EPA, 
and are undertaking natural resources restoration action 
pursuant to the Consent Decree. In November 1995, the mining 
companies appealed the dismissal of their claims against the 
United States to the Ninth Circuit. That appeal has been stayed 
while the parties attempt to negotiate a settlement of the 
claims not resolved in the Consent Decree and the AOC.

                       landwownership management

    A $2 million increase is proposed in the Landownership 
program including $1 million in real estate management and $1 
million in Land Line Location.
    Question. When can it be expected that the new fee schedule 
to obtain fair market value for communication sites will be 
implemented? The agency budget justification says 
implementation will be delayed. What level of funding is 
necessary to assure prompt implementation of the fee schedule?
    Answer. The FS started implementing its new fee schedule 
for communications uses (in the western Regions of the United 
States) in Calender Year 1996. Implementation was initiated 
following an extensive series of on-site training sessions 
during 1996. The agency is now conducting a series of follow-up 
visits to a sample of administrative units, to monitor fee 
schedule implementation, and to assure that it is being done 
accurately and consistently. Over 90 percent of our 
administrative units in the West (Regions 1 thru 6) have 
implemented the new fee schedule. The fees for a significant 
percentage of existing facilities will increase dramatically as 
a result. Many permit holders qualify for the fee phase-in 
provisions of our policy. Therefore, we don't expect to capture 
the full market value for facilities under a fee phase-in until 
Calender Year 2002.
    In fiscal year 1997, the FS intends to make our 
communication use fee schedule for the western United States 
applicable to all NFS lands. We will begin with a public notice 
and comment process, with final adoption occurring later this 
year or in early 1998. Implementation of the fee schedule in 
the Eastern, Southern, and Alaska Regions of the FS is expected 
to occur beginning in CY 1998.
    Question. What portion of real estate management funds are 
being used to exchange lands within wilderness areas? What is 
the future wilderness land exchange program in terms of funds 
planned and parcels covered?
    Answer. We estimate that 5 percent of Agency real estate 
management funds are being used to process exchanges in which 
the United States will acquire lands within designated 
wilderness areas. As long as real estate management funds 
remain consistent, it is expected that the 5 percent will 
remain constant.
    Question. During discussions regarding fiscal year 1997 
appropriations, the agency noted that many small hydroelectric 
project applications are being delayed due to the complexity of 
analysis requirements. Specifically mentioned was Martin Creek. 
Please provide an update of the status of the hydroelectric 
application process including an inventory of applications and 
a comparative status of the analysis process over the past 3 
years.
    Answer. Attached is an inventory of hydropower project 
applications affecting NFS lands over the past 3 years 
including the status of each project and an indication of 
whether the project was delayed due to the complexity of issues 
related to the project. To answer your questions, we queried 
each of our nine regions. Based on each region's response, we 
found that many forests have been able to respond in a timely 
manner to project proposal over the past 3 years but only with 
a great deal of time and effort expended by the Forest Service 
staff. At the same time, a number of project proposals have 
been delayed on various forests due to the complex issues 
related to project analysis. In addition to the complexity of 
issues, the regions cite other delaying factors, including: the 
FS administrative appeals process, litigation, disagreements 
between FERC and the FS during joint NEPA analyses, FERC 
backlog of projects, lack of communication from FERC during key 
points in the analysis process, lack of skilled personnel and 
lack of sufficient funding to effectively run the hydropower 
program.
    As shown in the attached table, most delays have occurred 
in regions 5 and 6 where the bulk of hydropower licensing and 
relicensing proposals are pending. These delays primarily occur 
during the time the FS and FERC are preparing cooperative NEPA 
documents. Delays have occurred on 28 of the 67 projects (40 
percent) the FS has worked on over the past 3 years due to the 
complex issues involved with analyzing these projects.

                  STATUS OF HYDROPOWER LICENSING AND RELICENSING APPLICATION  BY REGION 1994-97                 
----------------------------------------------------------------------------------------------------------------
Number        Project name            Application type                Status              Forest Service delays 
----------------------------------------------------------------------------------------------------------------
                                              Region 1 (Northern Region)                                        
                                                                                                                
  2188Missouri-Madison          Relicense..............  FS/FERC almost ready for      No                       
                                                          DEIS issuance.                                        
  2075Noxon Rapids              ...do..................  Relicensing started in 1995/  No.                      
                                                          FS and other agencies                                 
                                                          negotiating settlement                                
                                                          agreement w/Licensee.                                 
  2058Cabinet Gorge             ...do..................  ...do.......................  No.                      
  1991Moyie River               ...do..................  FS involved in Stage I        No.                      
                                                          consultation.                                         
                                                                                                                
                                           Region 2 (Rocky Mountain Region)                                     
                                                                                                                
  2187Georgetown                ...do..................  FS/FERC completed EA/license  Yes.                     
                                                          issued.                                               
  2035Gross Reservoir           ...do..................  FS involved in                No.                      
                                                          preapplication consultation.                          
  2275Salida                    ...do..................  FS/FERC completed EA-license  Yes.                     
                                                          issued.                                               
  2032Strawberry                ...do..................  FS in preapplication          No.                      
                                                          consultation.                                         
                                                                                                                
                                              Region 3 (Southwest Region)                                       
                                                                                                                
  2069Childs-Irving             ...do..................  FS/FERC preparing EA-draft    Yes.                     
                                                          EA about to be issued.                                
                                                                                                                
                                            Region 4 (Intermountain Region)                                     
                                                                                                                
  1994Snake Creek               ...do..................  FS in preapplication          No.                      
                                                          consultation.                                         
  1517Monroe                    ...do..................  ...do.......................  No.                      
                                                                                                                
                                          Region 5 (Pacific Southwest Region)                                   
                                                                                                                
   137Mokelumne                 ...do..................  FS reviewing amended          No.                      
                                                          application.                                          
   184Ed Dorado                 ...do..................  FS involved in Stage I        No.                      
                                                          consultation.                                         
  1388Lee Vining                ...do..................  FS administration             Yes.                     
                                                          appealpending.                                        
  1389Rush Creek                ...do..................  ...do.......................  Yes.                     
  1390Lundy                     ...do..................  ...do.......................  Yes.                     
  1394Bishop Creek              ...do..................  Litigation recently resolved  Yes.                     
                                                          in DC Circuit Court.                                  
  2661Hat Creek                 ...do..................  FS providing comments on      No.                      
                                                          application.                                          
  2687Pit 1                     ...do..................  ...do.......................  No.                      
  1962Rock Creek                ...do..................  FS coop. agency in FERC EIS.  No.                      
  2105Beldon Siphon             Amendment..............  FS administration appeal      Yes.                     
                                                          recently resolved.                                    
  1932Lytle Creek               Relicense..............  FS providing preliminary      No.                      
                                                          4(e) conditions.                                      
  1933Santa Ana                 ...do..................  FS providing 4(e) conditions  No.                      
  1934Mill Creek                ...do..................  ...do.......................  No.                      
   372Lower Tule                ...do..................  FS beginning to review        No.                      
                                                          proposal.                                             
  1333Tule River                ...do..................  DC Circuit Court decision on  Yes.                     
                                                          litigation issued recently.                           
  1930Kern River 1              ...do..................  Coop. EA in progress--        No.                      
                                                          preliminary 4(e)s issued.                             
  2290Kern River 3              ...do..................  FS admin. appeals pending...  Yes.                     
  1354Crane Valley              ...do..................  ...do.......................  Yes.                     
  1988Haas-Kings                ...do..................  ...do.......................  Yes.                     
  2017Big Creek                 ...do..................  FS involved in                No.                      
                                                          preapplication consultation.                          
  2085Mammoth Pool              ...do..................  EA in progress..............  No.                      
  1061Phoenix                   ...do..................  FS administration appeal      Yes.                     
                                                          pending.                                              
  3258Pine Creek                New application........  License denied litigation in  Yes.                     
                                                          DC Circuit Court resolved                             
                                                          recently.                                             
  6188Red Mt.-Tinemaha          ...do..................  License issued. Licensee      Yes.                     
                                                          recently filed lawsuit                                
                                                          against FS in state court                             
                                                          re: water rights issue.                               
 11543Lewiston                  ...do..................  FS reviewing application....  No.                      
 11452Angels                    Transfer of license....  FS working on NEPA w/FERC...  No.                      
 11477Utica                     ...do..................  ...do.......................  No.                      
 10081Clavey                    New Application........  Application withdrawn in      No.                      
                                                          1995 FS was coop. w/FERC on                           
                                                          EIS.                                                  
                                                                                                                
                                          Region 6 (Pacific Southwest Region)                                   
                                                                                                                
  1927N. Umpqua                 Relicense..............  FS working on NEPA analysis.  No.                      
   460Cushman                   ...do..................  FS participating in NEPA      No.                      
                                                          analysis.                                             
  2042Box Canyon                ...do..................  FS beginning to review        No.                      
                                                          application.                                          
  2225Sullivan                  Amendment..............  FS working on NEPA document.  No.                      
  2016Mayfield-Mossy Rock       Relicense..............  FS beginning consultation...  No.                      
  2071Yale                      ...do..................  ...do.......................  No.                      
  2342Condit                    ...do..................  FS analyzing proposal.......  No.                      
  1862Nisqually                 ...do..................  FS working on NEPA document.  No.                      
  3721Nooksack                  New application........  Part of river basin           Yes.                     
                                                          cumulative EIS. FS was                                
                                                          coop. agency w/FERC but                               
                                                          withdrew due to                                       
                                                          disagreements over                                    
                                                          information needs. FS                                 
                                                          commented on DEIS in 1995.                            
                                                          FEIS not yet issued.                                  
  4282Deadhorse Creek           ...do..................  Part of river basin EIS.      Yes.                     
                                                          (See discussion for                                   
                                                          Nooksack Falls Project on                             
                                                          previous page).                                       
  4312Canyon Creek              ...do..................  ...do.......................  Yes.                     
  4376Rocky Creek               ...do..................  ...do.......................  Yes.                     
  4437Diobsud Creek             ...do..................  ...do.......................  Yes.                     
  4628Wells Creek               ...do..................  ...do.......................  Yes.                     
  4738Glacier Creek             ...do..................  ...do.......................  Yes.                     
 10100Irene Creek               ...do..................  ...do.......................  Yes.                     
 10416Anderson Creek            ...do..................  ...do.......................  Yes.                     
 10942Martin Creek              ...do..................  ...do.......................  Yes.                     
                                                                                                                
                                                       Region 8                                                 
                                                                                                                
   269Queens Creek              Relicense..............  FS is preapplication process  No.                      
  1951Sinclair                  ...do..................  FS participating in EA......  No.                      
                                                                                                                
                                                       Region 9                                                 
                                                                                                                
  2064East Fork Chippewa River  ...do..................  FS in preapplication          No.                      
                                                          consultation.                                         
  2113Wisconsin River           ...do..................  FS administration appeal      Yes.                     
                                                          pending.                                              
   469Winton                    ...do..................  FS in prenotice stage of      No.                      
                                                          application review.                                   
  2360St. Louis                 ...do..................  License issued in 1966......  No.                      
  1864Bond Falls                ...do..................  FS submitted preliminary      No.                      
                                                          4(e) conditions in 1996.                              
  2402Prickett                  ...do..................  License issued in 1995 but    Yes.                     
                                                          rehearing pending.                                    
                                                                                                                
                                                       Region 10                                                
                                                                                                                
   420Ketchikan Lakes           ...do..................  FS involved in                No.                      
                                                          preconsultation process.                              
 11077Goat Lake                 New application........  FS involved in joint NEPA w/  No.                      
                                                          FERC.                                                 
----------------------------------------------------------------------------------------------------------------

    Questions. Additional challenges are occurring as a result 
of urban encroachment adjacent to NF Lands. (a) How has this 
affected the land line location program? (b) Is an increasing 
amount of funds being used to support litigation relative to 
private land encroachment? (c) How has this affected the timber 
sale program on lands adjacent to private ownership?
    Answers. (a) Urban encroachment on NFS lands is occurring 
at a rate faster than funding for the Landline Location program 
allows us to survey the boundaries. The majority of urban 
interface encroachments are occurring in areas with the highest 
real estate prices, areas of high demand for private ownership, 
and areas with high development potential because they provide 
easy access to the public lands. Areas around Los Angeles, CA; 
Lake Tahoe, NV; Jackson, WY; Aspen, Vail, and the Front Range 
of Colorado are heavily impacted. This increasing need to 
survey, mark, and maintain the NFS boundaries in and adjacent 
to urban development has refocused the direction of the 
Landline Location program. The program in the past was focused 
almost exclusively on physically marking the lines where 
resource management activities were occurring. In the past 
these land and resource activities were occurring faster than 
the forest surveyor could establish or mark the property lines. 
Consequently only the most serious encroachments and trespasses 
were acted upon. The Landline Location program in recent years 
has become more focused on providing a complete stewardship 
responsibility of the public estate, including the survey and 
marking of these urban interface boundary lines to prevent 
occupancy of NFS lands, and to support land and resource 
management activities. Included in this responsibility is the 
resolution of property line conflicts with our adjoining 
landowners as well as the defense of the public estate. We now 
place greater emphasis on protecting the boundary lines 
previously marked, and marking boundary lines where there is a 
greater likelihood of urban interface encroachment onto the 
public estate.
    (b) There does not appear to be a significant increase in 
the amount of funds used to support litigation to resolve 
private land encroachments on NFS lands. This is due in part to 
efforts on the part of the FS to resolve encroachments and 
trespass cases without the use of litigation, using the various 
public laws and authorities available to resolve encroachments 
on NFS lands. This effort to resolve encroachments before 
litigation develops is considered a lands stewardship 
responsibility and is generally funded and/or supported with a 
combination of Landline Location (NFLL), Real Estate Management 
(NFLA), and benefitting function funds. Often the potential for 
litigation encourages the FS and the encroaching adjoiner to 
seek an amicable and legally acceptable resolution.
    (c) The FS policy is to survey and mark all NFS boundaries 
prior to any resource management activity occurring on NFS 
lands adjacent to non-NFS lands (private, corporate, state, or 
other federal agency lands). These land surveys, performed 
prior to the resource management activities usually identify 
encroachments on the public estate, as well as mark the 
boundary lines of the NFS. The discovery of encroachments on 
NFS lands may in some cases lead to the exclusion of land and 
resource management activities within the strip of encroachment 
until such time as the encroachment is resolved.

                       infrastructure management

    An increase of $3.2 million is planned for Infrastructure 
Management, including $1.9 million for road maintenance and 
$1.3 million for maintenance of facilities.
    Question. Up to $5 million of road maintenance funds have 
been authorized for use in obliterating forest roads. In what 
regions have such funds been spent in? What criteria are 
employed to determine which roads should be obliterated?
    Answer. In fiscal year 1996, all Regions obligated road 
maintenance funds for road obliteration. The amount of road 
maintenance funds obligated in each Region for road 
obliteration in fiscal year 1996 is summarized below.

Fiscal year 1996 road maintenance funds obligated for road obliteration

        Region                                                 Thousands
1.................................................................  10.8
2.................................................................  35.0
3.................................................................  72.6
4.................................................................   7.5
5................................................................. 162.5
6................................................................. 548.1
8.................................................................  24.1
9.................................................................   1.7
10................................................................  30.0
                        -----------------------------------------------------------------
                        ________________________________________________
      Total....................................................... 892.3

    Land managers at the field level decide which roads should be 
obliterated based on forest plan objectives and resource management and 
protection needs. Road obliteration decisions are made based on the 
long term need of a road to manage and protect resources; the need to 
reduce erosion or limit road density to enhance wildlife management; or 
the need to meet other ecosystem management objectives.
    Predominately, the roads being obliterated are un-engineered roads 
that are causing serious environmental damage due to poor location, 
steep grades, and lack of proper drainage. They are mostly old skid 
trails, off-road vehicle tracks, and timber or mining roads constructed 
without the benefit of proper design. Many have already been closed to 
vehicle use. In a few cases, they are Forest Development Roads no 
longer needed due to changed resource management objectives.
    Question. Despite a slightly more than 2 percent increase in road 
maintenance funding request, there is no increase in accomplishment. 
How will the increased funds be used?
    Answer. The requested funding is sufficient to fully maintain 
approximately 40 percent of roads and associated structures at a level 
consistent with current use. We expect little change in the percent of 
roads fully maintained since the 2 percent increase is roughly 
equivalent to inflation.
    Question. As the agency reduces its employees, how has this 
translated to a reduction in facilities that must be maintained for the 
employees? Are costly facilities able to be eliminated?
    Answer. Many Forest Service offices are in leased facilities. As 
facility leases come up for renewal, we consider moving to government-
owned facilities or reducing the square footage needed in the new 
lease.
    Some Forests have looked for opportunities to make unused space 
available through sharing arrangements with other agencies. Forests 
have also turned back unused space to the General Services 
Administration for reassignment to other agencies.
    Some examples of efforts to eliminate or reduce facilities include:
    Region 1.--Six offices co-located into three with four additional 
offices planned for co-location in the near future.
    Region 4.--Updated a forest facilities master plan calling for the 
elimination of 120 buildings.
    Region 5.--After co-locating ranger districts, three leased 
facilities are being eliminated and two district office facilities are 
recommended for disposition. One administrative unit moved from a 
leased facility to a government-owned facility and an old ranger house 
used for administrative purposes is planned for disposal. Also, space 
for a Forest Supervisor's Office will be reduced when contracting for a 
new lease.
    Region 6/Pacific Northwest Station.--A warehouse and a residence 
will be exchanged for riparian resource land. A Research lab has been 
transferred to a state university. A guard station was transferred to a 
town for use as a city park. Co-location of Forest Service and BLM 
personnel is in progress in several locations across the Region. Sites 
not currently in use where long-term need by FS has not been determined 
have been made available for use by others via special use permits 
using the Granger-Thye authority. Where recreation is the preferred 
activity, some facilities such as fire lookout towers are being made 
available for rental using the Granger-Thye authority.
    Region 8.--District consolidations in South Carolina, Mississippi, 
and Texas and a forest consolidation in Virginia (George Washington-
Jefferson NFs) will lead to reductions in facilities. Regional Office 
downsizing has reduced the amount of leased space required.
    Region 10.--Minor consolidation of leased space on two national 
forests has led to minor consolidation of leased space.
    In the case of Research, many of our laboratories are federally 
owned. We are co-located with a number of Universities on their 
campuses and in some cases the space is free.
    Budget reductions in fiscal year 1996 have caused us to close seven 
locations. Each closure has different circumstances to address. In some 
cases the facilities are still being maintained due to leases and 
contract stipulations. One facility has been transferred to a community 
college as a result of Congressional direction. No savings have 
occurred to date due to transfer of station costs and utility/general 
maintenance contracts which need to be continued until facilities are 
eliminated.
                            law enforcement
    The Administration proposes an increase of $2.3 million to this 
program.
    Question. The Forest Service and Department requested $69 million 
for law enforcement operations. The administration reduced this amount 
in spite of an agency appeal. Now the Forest Service faces eliminating 
more than 60 law enforcement employees. What amount of funding will 
prevent the elimination of these positions?
    Answer. In the Administration's 1998 budget for law enforcement 
there is an increase of $2.3 million from the previous fiscal year. In 
recent years, the approval and passage of laws specifically related to 
increased law enforcement salaries, including Title 5, U.S.C. Section 
5545 (a) Law Enforcement Availability Pay for criminal investigators, 
and (c) Administratively Uncontrollable Overtime for law enforcement 
officers, and approval of early retirement for LEOs has continued to 
increase base program costs. This $2.3 million will cover increased 
base costs for a reduced level of law enforcement employees.
    Law enforcement personnel are more expensive to fund than normal 
agency personnel because of the laws and benefits listed above. These 
higher base costs plus the additional costs to maintain specialized 
training requirements along with certifications and specialized 
equipment needed in the performance of their duties contribute to an 
estimated costs for a Law Enforcement Officer to be around $75,000 per 
individual. After fixed costs are reduced from the budget for law 
enforcement (fleet equipment, support, and cooperative law enforcement) 
90 percent of the remaining amount goes directly to salary and 
associated costs.
    Presidential direction last year directed the Agency to place an 
additional 20 law enforcement officers on the California/Mexico border 
to address the increased resource violations created by illegal aliens. 
This direction has further impacted the Forest Service law enforcement 
program. In order to meet this special direction, we are detailing 
officers from regular duty stations service-wide to this special 
problem area. The FS has requested reimbursement from INS for these 
operations, both those already provided and those that will continue in 
fiscal year 1998.
    Continued refinement of information has identified that added costs 
could create a shortfall in funding for some occupied positions. 
Approximately, 50 occupied positions could be affected. All of these 
positions are considered important to maintain a professional effective 
program. Costs associated with a reduction of 50 positions is estimated 
at $3.7 million. However, a higher funding level for this program would 
require an offset of providing lower funding for other Agency program 
areas.
    Question. Results from an independent study of the law enforcement 
organization seemed to indicate that it was too early to determine the 
effectiveness of the ``straight-line reporting structure.'' The report 
states that the organization is still evolving. What steps is the 
agency going to take to assure full evolution and operation as a 
professional law enforcement organization?
    Answer. The Forest Service fully supports the implementation of the 
straight-line reporting structure for the law enforcement program. The 
program now has investigative independence and is free from allegations 
of interference and improprieties. Also professional standards and 
guidelines are now in place which improve the program's role in 
supporting resource management activities and ecosystem protection. The 
following steps will be taken to continue the evolution of this 
important program:
    1. Continue to evaluate the level of organizational structure 
needed and implement standards of performance for LE&I personnel that 
will heighten the professionalism of LE&I.
    2. Emphasize training, both initial and in-service, which is an 
inherent part of any professional organization.
    3. Examine the need to streamline and update Title 36, Code of 
Federal Regulations, as it relates to FS LE&I activities and 
prohibitions.
    Question. The President has directed the Forest Service to station 
20 officers on the Cleveland National Forest for the purpose of 
conducting border operations. These operations have resulted in the 
apprehension of thousands of illegal aliens. What authority does the 
Forest Service have to conduct such operations? How much has the 
President's direction cost?
    Answer. The authorities for the protection of the resources are 
contained in 16 U.S.C. 551, 559, 559b, 559c, and 559d. 16 U.S.C. 553 
allows officers from the Forest Service to ``aid the other Federal 
bureaus and departments on request from them, in the performance of the 
duties imposed on them by law.'' At the direction of the President, the 
Forest Service has provided additional law enforcement personnel on the 
southern areas of the Cleveland National Forest. These additional 
officers have been provided to increase the protection of the using 
public, employees and the resources. The role of the Forest Service is 
not the apprehension of illegal aliens. If individuals are contacted 
while law enforcement personnel are performing their core mission, they 
are detained for the United States Border Patrol.
    During fiscal year 1996, costs for the Cleveland operations that 
were above normal Law Enforcement activity costs amounted to 
$1,048,000. This amount covers the extra travel/per diem/lodging and 
overtime for the officers detailed to this special operation. Officers 
base salaries are not included.
    Costs above normal activity levels for this fiscal year through 
March 31, 1997, are estimated at approximately $556,000.
              wildland fire management and brush disposal
    A significant budget restructuring is being proposed for the 
Wildland Fire Management program. The Administration is also proposing 
to establish a government-wide emergency contingency account to support 
operations for major national emergencies. Under the Brush Disposal 
program, the agency proposes to accomplish 33.7 thousand acres less of 
treatment.
    Question. The agency recently initiated an effort referred to as 
``Fire 21'' to address issues of safety, planning, role of fire, 
wildland urban interface, preparedness, and accountability. What 
significant improvements have occurred in these areas as a result of 
``Fire 21?''
    Answer. ``Fire 21'' is a long term strategy to provide a safe and 
more effective wildland fire protection program. It has provided a 
communication tool for identifying the priorities in wildland fire 
management. This has helped managers and employees focus efforts on the 
critical jobs to be done. A line officer team and a network of fire 
management officers are working together for the first time in a 
national effort to facilitate implementation of Fire 21. A Fire 21 
Cadre Implementation Plan is being developed to direct the training and 
development of the workforce in the skills required to meet future 
challenges.
    Question. What specific measures have been implemented to make fire 
suppression and preparedness more efficient and cost effective?
    Answer. Comparative analyses are made of different mixes of 
firefighting resources to determine the least cost and most effective 
combinations for a given area. National, regional, and forest reviews 
examine budget implementation and preparedness activities on a 
regularly scheduled basis to improve accountability. Opportunities 
where resources can be shared have been implemented with consolidation 
of facilities where appropriate. Contracts for support services are 
made through a competitive bid process.
    Question. What procedures are used by the Forest Service for 
projecting and allocating wildfire suppression resources among 
wildfires in order to control, and possibly reduce, wildfire 
suppression costs?
    Answer. The National Interagency Fire Center coordinates the 
efficient mobilization of resources at the national level. This 
assignment of resources is made on a priority basis for large fires in 
competition with each other. Priorities are set by a multi-agency 
coordination group based on values at risk. Costs are considered in 
terms of mobilization and transport of closest available resources. 
Similar procedures are used by Geographic Area Coordination Centers 
around the country for regional and local decisions.
    Question. How well do the cooperative agreements for allocating 
wildfire suppression resources between the Forest Service and other 
federal, state and local agencies work? Are improvements needed in how 
the allocation of suppression resources is accomplished?
    Answer. Cooperative fire protection agreements between federal and 
state agencies promote the effective use of fire resources between 
organizations. There has been a significant effort between federal, 
state and local fire agencies to establish new and update old 
cooperative fire protection agreements, particularly in areas with 
wildland/urban interface fire challenges. This process will improve the 
effective and efficient use of interagency fire suppression resources.
    Question. How does the Forest Service estimate, document and 
account for wildfire suppression costs? Is an Incident Cost Accounting 
Report (ICAR) prepared for each wildfire? If not, why not?
    Answer. The National Fire Management Analysis System allows 
projections of average annual suppression costs for national forest 
system lands. The suppression cost of each wildfire is estimated by use 
of an Escaped Fire Situation Analysis used at the local level. Incident 
Management Teams assigned to large wildfires track and monitor 
suppression costs of each incident daily and develop final fire cost 
packages for the agency. Agency Comptrollers monitor expenditures and 
provide advice for cost control measures to local line officers.
    The size and complexity of the fire determine if an Incident Cost 
Accounting Report or equivalent is prepared. There are no set factors 
for its use. Examples of some determinants for the use of an Incident 
Cost Accounting Report are multiagency jurisdiction, public concerns, 
threat to resources and property, etc.
    Question. What level of preparedness funding would be necessary in 
fiscal year 1998 to operate at 90 percent MEL?
    Answer. Preparedness funding at 90 percent MEL would mean a level 
of $351 million.
    Question. The agency budget justification states that there is a 
greater risk to public and firefighter safety with funding below 100 
percent of the MEL index (most efficient level). How is safety 
specifically affected by a lack of 100 percent funding?
    Answer. The National Fire Management Analysis System is used to 
determine the Most Efficient Level (MEL) for wildfire suppression. The 
MEL quantifies the organizations and budget needed to safely and 
effectively fight wildfire. MEL is based on historical wildfire 
occurrence, size and difficulty of control in specific locations. At 
funding levels less than MEL, there are fewer firefighters and 
equipment available. Less firefighters for initial attack often results 
in larger, more intense wildfires. To the extent that there are larger, 
more dangerous fires, firefighters and public safety become of 
paramount concern.
    Question. The agency established a goal of ``red carding'' 75 
percent of all Forest Service employees? How successful has this effort 
been so far?
    Answer. The goal is to increase support for fire suppression, 
especially during periods of severe fire activity. This also includes 
non-redcarded personnel. Several Regions have already required fire 
support requirements be placed in every person's (both redcard and non-
redcard personnel) position description which has increased the pool of 
available personnel.
    Some units have reported a red-card success rate as high as 85 
percent.
    Question. In combination with Brush Disposal funds, what is the 
overall status of the hazardous fuels inventory? Is this inventory 
declining or increasing?
    Answer. We estimate that there are approximately 58 million acres 
having naturally occurring fuels that are predisposed to stand 
replacement fire, i.e., fire which will totally consume all the 
vegetation. This, by far, outshadows any level of fuels generated 
specifically by timber sale activities and which qualify for brush 
disposal funds. This acreage predisposed to stand replacement fire is 
constantly growing, especially as commodity production levels decrease.
    Question. The agency budget justification states that hazardous 
fuels reduction activities which were previously funded under the 
Preparedness and Fire Use budget line item have been moved to the 
Suppression Operations budget line item. A review of the President's 
budget does not indicate how actual planned expenditures for this 
function will be affected by the change. What specific expenditures are 
planned for hazardous fuels reduction as compared to the past 5 years 
of expenditures? What gains will be realized from this change?
    Answer. The new budget structure moves hazardous fuels reduction 
activities from the Preparedness and Fire Use budget line item (renamed 
Preparedness) to the Suppression Operations budget line item (renamed 
Fire Operations). This allows flexibility in funding hazardous fuels 
activities to more effectively address the health of the Nation's 
forests without detracting from the capability to prevent forest fires 
and to take prompt, effective initial attack suppression action on 
wildfires.
    The proposed budget level will allow funding for hazardous fuels 
reduction at a level of between $30-$50 million. Depending on weather 
conditions this funding level will allow treatment of between 850,000 
and 1,300,000 acres in high priority areas where the risk of wildfire 
and long-term damage to resources can be reduced through fuels 
management.
    Question. The brush disposal accomplishments for fiscal year 1996 
and fiscal year 1997 are higher than those proposed for fiscal year 
1998. Does this indicate that progress is being made in reducing the 
backlog of untreated acres?
    Answer. No. The brush disposal line item is a permanent 
appropriation for the treatment of debris resulting from a timber sale. 
National forest timber sale contracts require treatment of debris 
created by timber sale operators. This work can be performed by the 
timber purchaser, the purchaser can request the Forest Service to do 
the work by depositing funds to cover the cost of the work, or the 
Forest Service can require mandatory deposits and the agency complete 
the work. The reduction of brush disposal acres is in response to the 
decline in timber sales over the past several years. Hazardous fuels 
reduction is part of the Fire Operations line item and provides for all 
hazardous fuel reduction program activities. These activities are 
conducted in high priority areas where the risk of wildfire and long-
term damage to resources can be reduced through fuel management. The 
President's budget would allow funding for hazardous fuels reduction at 
a level of between $30 and $50 million. Depending on suitable weather 
conditions, this funding level will allow treatment of between 850,000 
and 1,300,000 acres which is an increase of between 100,000 and 550,000 
acres from the level planned for fiscal year 1997.
    Question. What is the status of the Brush Disposal fund nationwide 
in terms of cash on hand and to be collected, versus the cost of work 
to be accomplished with brush disposal funds?
    Answer. As of September 30, 1996, the Brush Disposal fund had an 
unobligated cash balance of $39 million, and anticipated collections 
during fiscal year 1997 are estimated to be approximately $16 million 
(this is an updated anticipated collection figure subsequent to the 
President's Budget.) The planned program level for fiscal year 1997 is 
for treating 185,000 acres at a cost of $45.6 million. There are 
adequate funds available to complete planned brush disposal in fiscal 
year 1997.
    Question. Smokey Bear is an integral part of the Forest Service 
fire prevention message. Smokey is uniformly recognized by school 
children throughout the United States as an icon that can be trusted. 
Critics say Smokey Bear's use is over zealously protected by the Fire 
Prevention Establishment to be used exclusively for the prevention of 
fire. What is the agency's position on the expanded use of Smokey Bear 
in other critical national initiatives such as ``just say no to drugs'' 
campaign, or a national violence prevention program?
    Answer. Congress established Smokey Bear as the National Forest 
Fire Prevention Symbol with Public Law 82-359. The law states clearly 
that Smokey is to promote ``Forest Fire Prevention''. It further takes 
him out of the public domain and places him under the direction of the 
Secretary of Agriculture in cooperation with the National Association 
of State Foresters and the Advertising Council. In 1974, Smokey's 
responsibility to Forest Fire Prevention was further reinforced by 
Public Law 93-318.
    Studies conducted through the Advertising Council show Smokey's 
high recognition level and success is due to his simplicity of message. 
Almost 70 percent of school children can recognize his message of 
``Remember, Only You Can Prevent Forest Fires''. To confuse his message 
with drugs, violence, ecology, pollution or any other national campaign 
is to dilute his message and violate his intended use.
                    reconstruction and construction
Facilities construction and reconstruction
    The administration proposes to decrease funds to support facilities 
by a total of $27.7 million including a reduction of $26.5 million for 
recreation facilities.
    Question. The agency proposes to change appropriation language to 
authorize the expenditure of up to $250,000 for minor construction. How 
would funds be generated to perform the assumed increase in minor 
construction? What program accomplishments would be affected by 
diverting funds from other line items for the purpose of minor 
construction? Would the performance of this minor construction be 
managed in such a manner as to assure other program accomplishment does 
not suffer? An agency briefing paper dated February 7, 1997 states that 
if the limit were increased to $250,000, a total of 85 percent of all 
Research and FA&O facility reconstruction or construction projects 
could be accomplished. If this change were enacted, what timetable 
would the agency follow to bring facilities to current standard without 
affecting program accomplishments? What percent of the recreation 
backlog would be applicable to this new $250,000 limit?
    Answer. We do not intend to increase significantly the total number 
of dollars spent for minor construction. Therefore, program 
accomplishments in funds tapped for minor construction will not be 
affected significantly.
    Raising the minor construction authority would provide another tool 
to give line officers more flexibility to meet their priority needs. 
Some program funds could be focused on a Region-wide basis for minor 
construction of replacement facilities rather than continued remodeling 
or renovations of old structures. For example, additions could be 
constructed to replace aging mobile homes used for temporary office 
space or crew quarters.
    A summary of minor construction projects completed in fiscal year 
1996, planned for fiscal year 1997, and estimated for fiscal year 1998, 
based on raising the minor construction authority, is shown in Table A. 
The total number of projects completed will be reduced with the average 
cost of individual projects expected to increase.

                                    TABLE A--FA&O MINOR CONSTRUCTION PROJECTS                                   
----------------------------------------------------------------------------------------------------------------
                                                                     Number of       Total in      Average cost/
                           Fiscal year                               projects        millions         project   
----------------------------------------------------------------------------------------------------------------
1996 (completed)................................................              90            $3.9         $43,000
1997 (planned)..................................................              65             3.3          51,000
1998 (estimated):                                                                                               
    Less than $100,000..........................................              28             1.7          61,000
    $100,000 to $250,000........................................              11             1.6         146,000
----------------------------------------------------------------------------------------------------------------

    If the change is enacted and the Regions do not increase the amount 
of benefitting funds for minor construction, the construction and 
reconstruction backlog will continue to grow. The 85 percent refers to 
the number of projects that have a total individual project cost under 
$250,000. Projects under $250,000 account for 27 percent of the total 
estimated FA&O facility backlog cost. Because this proposal does not 
intend to raise capital investment funding, the backlog will continue 
to grow. Therefore, no timetable for bringing existing facilities up to 
current standards can be set.
    The recreation facility backlog, now in excess of $818 million, is 
not expected to change significantly with this increase in authority.
    Question. What portion of the reconstruction backlog is applicable 
to the current ``minor'' reconstruction limit of $100,000?
    Answer. About 50 percent of the total number of projects on the 
Fire, Administrative, and Other (FA&O) facilities reconstruction and 
construction backlog could be accomplished under the current minor 
construction authority of $100,000.
    Question. Recently the Oakridge Ranger Station, Willamette National 
Forest was destroyed by arson. What effort has been undertaken to 
reconstruct this facility? When will this task be accomplished? Why was 
this project not included in the fiscal year 1998 construction plans? 
If it were now included, what projects would be dropped from the plan 
if there were no increase in appropriation?
    Answer. The Forest Service is proceeding expeditiously in assessing 
options of reprogramming or transferring funds to provide approximately 
$3.9 million in fiscal year 1997 to reconstruct the Oakridge Ranger 
Station. Once funds are are available, it could take up to 2 years to 
complete construction since outside work cannot proceed during the 
winter months at the site.
    The Oakridge project was not included in the fiscal year 1998 
program since it was the intent of the Forest Service to submit the 
reprogramming request in fiscal year 1997. It is important to note that 
if the $3.9 million Oakridge project is included in the project list 
for the current $8.196 million total FA&O request, each Region's share 
could be reduced more than half, from $841,000 to about $379,000. The 
allocation to the Northeastern Station would be reduced from $394,000 
to $252,000.
    The projects in the FA&O Reconstruction and Construction Project 
Listing in the Forest Service's explanatory notes are listed in 
priority order by Region. The following list shows projects that 
probably would be dropped or receive substantially reduced funding 
based on the decreased allocations to Regions if Oakridge is included 
without an increase in this line item. Some adjustments in the final 
list of projects may also be needed since it is unlikely across-the-
board reductions would result in a viable project in all cases. Some 
minor adjustments in the planning and design projects may be possible 
but large reductions would most likely result in loss of personnel and 
capability to accomplish planning and design work.

----------------------------------------------------------------------------------------------------------------
                                                                                                Project  Reduced
                State                           Forest                    Project name          dropped  funding
----------------------------------------------------------------------------------------------------------------
Montana..............................  Lolo....................  Ninemile RS utilities........        X  .......
    Do...............................  Lewis & Clark...........  Hannon Gulch/Little Snowies          X  .......
                                                                  WC.                                           
    Do...............................  Flathead................  Spotted bear fourplex, phase   .......        X
                                                                  2.                                            
Colorado.............................  GM/UNC/Gunn.............  Norwood Bunkhouse............        X  .......
    Do...............................  Med Bow/Routt...........  Yampa Bunkhouse..............        X  .......
    Do...............................  ...do...................  Walden Bunkhouse.............  .......        X
Arizona..............................  Kaibab..................  Chalendar RS, phase 3........  .......        X
Idaho................................  Boise...................  Garden Valley crew quarters..        X  .......
Utah.................................  Fishlake................  Loa district office..........        X  .......
    Do...............................  Dixie...................  Panguitch Bunkhouse..........  .......        X
California...........................  LTBMU...................  LTBMU Supervisor's Office,           X  .......
                                                                  phase 3.                                      
Oregon...............................  Fremont.................  Silver Lake Office, phase 1..  .......        X
Kentucky.............................  Daniel Boone............  Redbird WC...................  .......        X
Michigan.............................  Hiawatha................  St. Ignace administration      .......        X
                                                                  site.                                         
Alaska...............................  Chugach.................  Cordova Office, phase 3a.....        X  .......
    Do...............................  ...do...................  Seward RD Office.............        X  .......
    Do...............................  Tongas-Stik.............  Petersburg RD housing........  .......        X
West Virginia........................  Morgantown..............  Morgantown Annes construction        X  .......
----------------------------------------------------------------------------------------------------------------

    Question. How has the Challenge Cost-share and other 
partnership programs specifically assisted in the 
reconstruction and construction of recreation facilities?
    Answer. The Challenge Cost-share and other partnership 
programs assist in the reconstruction and construction of a 
wide range of recreation facilities, specifically in the areas 
of: Developed sites, trails, interpretation and education, 
fishing, and heritage. The following are examples of typical 
projects:
    Region 1, Montana, Flathead River Access: Reconstruction of 
rest rooms, boat ramp, and parking lot.
    Region 2, Colorado, Maroon Valley: Reconstruction of three 
campgrounds, entrance station, three trailheads, trails, 
parking lots, signs, and shelters.
    Region 3, Arizona, Sabino Canyon Interpretive Sites: 
Reconstruction of the parking lot and the environmental 
education and interpretive facilities.
    Region 4, Utah, Great Western Trail: Construction of five 
trail segments, trailhead, signs, revegetation, and 
interpretation.
    Region 5, California, Taylor Creek Stream Profile Chamber: 
Reconstruction of the building to conform with the Americans 
With Disabilities Act, revision of the interpretive exhibits, 
and rehabilitation of the trail.
    Region 6, Washington, Johnston Ridge Observatory Exhibits: 
Construction of interpretive and educational exhibits in the 
Mount St. Helens National Volcanic Monument.
    Region 8, Texas, Cagle Sanitation: Construction of a sewer 
treatment facility for a new recreation complex.
    Region 9, West Virginia, Seneca Rocks Excavation: 
Excavation of prehistoric site and development of the 
interpretive plans for proposed construction of a Visitor 
Center.
    Region 10, Alaska, Starrigavan ATV Trail: Construction of 
two loop trails and a parking lot; rehabilitation of existing 
logging roads; and replacement of a bridge.

                  road construction and reconstruction

    The administration proposes to reduce funds for road 
construction and reconstruction by $6.7 million.
    Question. The Agency reports a road reconstruction backlog 
which is estimated to be between $4 and $5 billion. The most 
urgent roads in need of reconstruction total approximately $403 
million. Despite this backlog, the administration proposed a 
funding level of $86.3 million which is less than the lowest 
increment proposed by the agency. Concurrently the 
administration proposes a $17.6 million dollar increase in the 
timber sales management and salvage programs over the agency 
request. This appears to be inconsistent. How can the agency 
meet future timber offer goals if the volume is prepared for 
sale but the road system is not in condition to support the 
volume removal?
    Answer. Funding for roads backlog must be balanced against 
the need for funds for other Forest Service programs and the 
need to balance the budget.
    The proposed budget assumes fewer sales in roadless areas 
and the need for less timber road support funding.
    Funds for timber roads are adequate to administer road work 
on existing sales and to prepare surveys and designs for fiscal 
year 1998 green sale program of 2.505 MMBF. Engineering support 
needed for out year sales, including transportation planning, 
design, rights of way and bridge reconstruction and 
construction, will be provided to the extent possible. The sale 
program will be located to the extent possible to minimize road 
requirements. While every effort will be made to meet planned 
sale levels, some out year sales may be delayed.
    Roads support for salvage sales is funded from salvage sale 
funds so that program is not affected by the reduction of road 
funds.
    Preparation and administration of timber sale road 
maintenance is a relatively small portion of the road 
maintenance program and the actual maintenance is funded as 
part of the timber sale appraisal. The reduction in road 
maintenance funding is not expected to impact the timber 
program in fiscal year 1998.
    Question. The agency budget justification states that 
direction is to ``minimize entry into roadless areas.'' In July 
1996, the Secretary placed restriction on salvage sale 
preparation which excluded volume in inventoried roadless 
areas. Why is the Administration continuing to avoid 
development and management of roadless areas which are 
available for timber production and which are considered as 
timber lands in the Forest planning process?
    Answer. First, in regard to the Secretary's July 1996 
restriction, the restriction applied to only those sales that 
were not considered emergency. The prohibition did not apply if 
salvage sales qualified under the definition of ``imminently 
susceptible to fire.'' Trees ``imminently susceptible to fire'' 
were trees located in areas with high fuel loading or where 
there was a high fire risk rating for the specific habitat 
type, and near local communities or occupied structures. 
Proposed sales in areas with high fuel loading or where there 
is a high fire risk rating for the specific habitat type, but 
that are not near local communities or occupied structures, are 
to receive priority consideration for offering under the normal 
timber program authorities according to the July, 1996 
direction.
    Regarding the budget justification statement, the Forest 
Service is placing a high priority on regaining trust by the 
public by collaborating with them as timber sales are proposed. 
We know that roadless area entry is often controversial, so the 
focus is on areas outside the roadless area for the most part 
to increase the likelihood of rebuilding trust. As noted in the 
statement however, entry into roadless areas will continue.
    Question. The agency's request for road construction funds 
was reduced $19.2 million by the Administration. How does this 
action by the Administration affect road construction plans in 
fiscal year 1998? Will access to specific roadless areas not 
occur due to this action? If so, what areas?
    Answer. Funding for the recreation and general roads 
programs is adequate to serve the immediate needs for these 
programs. However, a large backlog of road and bridge 
reconstruction needs exist in these areas. This backlog is 
expected to increase in fiscal year 1998.
    The proposed budget assumes fewer timber sales in roadless 
areas. Agency direction is to minimize entry into roadless 
areas. The impact on access to specific roadless areas has not 
yet been determined.
    Question. In response to subcommittee questions for the 
fiscal year 1997 process, the agency stated that it is no 
longer tracking the status of maintenance backlog. The fiscal 
year 1997 testimony provided data on road construction and 
reconstruction backlog for fiscal year 1994. No data was 
provided for fiscal year 1995 because the elimination of 
backlog data in favor of developing an ``infrastructure data 
base.'' However, a February 7, 1997 briefing paper states that 
this data base will be able to provide an updated shortfall 
estimate for all but the roads component. In view of this 
statement, how will the agency track backlog for the road 
component and be able to provide the appropriate level of 
backlog information for the Subcommittee?
    Answer. At present, the Infrastructure team is developing a 
Travel Routes module for the new IBM platform. The intent of 
Travel Routes is to provide an integrated information 
management environment for managing the inventory database of 
national forest system roads and trails. The Travel Routes 
module prototype is planned to be made available for testing in 
August 1997. It should be released for use in 1998. The Travel 
Routes module will include information fields to track backlog 
data for roads. Travel Routes will be the information 
management system used to provide backlog information, however 
additional time will be necessary to allow Forests to input 
field data before the system is fully operational and can 
provide meaningful reports and summaries.
    Question. The agency refers to an increasing number of 
roads being obliterated. What has been the predominant use of 
these roads (timber, fire, recreation, etc)? Will the 
recreation public be impacted by the obliteration of these 
roads?
    Answer. Predominately, the roads being obliterated are un-
engineered roads that are causing serious environmental damage 
due to poor location, steep grades, and lack of proper 
drainage. They are mostly old skid trails, off-road vehicle 
tracks, and timber or mining roads constructed by operators to 
access and remove the resource without the benefit of current 
design standards for public safety and environmental 
protection. Many have been closed to vehicle use already. They 
are not needed for the management of NFS lands and are being 
obliterated to reduce erosion and to enhance ecosystem 
management.
    The impacts to the motoring public is generally expected to 
be minimal because most of the roads to be obliterated are 
already closed to motor vehicle use. Some obliterated roads 
will still serve non-vehicular uses such as hiking or horse 
riding.
    Question. Recent storm damage in the western states caused 
significant damage to watersheds as a result of road failures. 
How does the agency budget proposal address road system 
modification to avoid future significant damage of this kind? 
Will current design standards and costs be affected by findings 
from an assessment of this storm damage?
    Answer. The budget was developed to implement the best 
available low volume road design technology and to meet the 
standards and guidelines of the Northwest Forest Plan and 
similar regional planning efforts in the Columbia Basin. These 
strategies seek to minimize the influence of roads on hillslope 
hydrology, fisheries, and downstream values. Lessons learned 
from recent flooding will be incorporated in design standards.
    We are studying the impacts of these recent floods to see 
how we can prevent damage in the future. Region 1 is conducting 
landslide assessments which will provide tools for better road 
planning and location and will also identify roads for 
obliteration. Region 6 is cooperating with the State of Oregon 
in flood damage assessment to identify road location, design, 
and construction factors related to storm damage. A Water/Roads 
Steering Committee was formed to guide selection of technology 
development projects related to water and roads interaction. 
Environmental standards for drainage, culverts, and bridge 
construction dictate increased design lives for reduced 
environmental impact. Risk assessments and Access and Travel 
Management planning are identifying and prioritizing roads not 
needed for long term forest access so they can be obliterated.

                           trail construction

    The Administration proposes an increase in trail 
construction funds of $5.5 million.
    Question. The agency says 90 percent of all trail funds 
will be used for trail reconstruction. Assuming the President's 
budget is allocated for construction, what is the comparison of 
planned fund use between wilderness and non-wilderness trails? 
What is the cost per mile for trail reconstruction in the 
wilderness versus non-wilderness?
    Answer. Ninety percent of trail re/construction funds were 
indicated to be used for reconstruction and addressing the 
backlog of deferred maintenance. The ratio for reconstruction 
of trails inside and outside wilderness will be determined by 
the forests in each region. We estimate that wilderness trail 
miles to be reconstructed will be will be 15-25 percent of the 
total trail miles, and will receive approximately 25-40 percent 
of the trail re/construction funds. The average cost per mile 
for trail re/construction is $7,000 in the eastern U.S., 
$20,000 in the western U.S., and $142,500 in Alaska, with costs 
varying depending on the type of soil or rock, the number and 
type of bridges, culverts, water bars, or other structures, and 
the accessibility to trail sections. Costs for operation, 
maintenance and re/construction in wilderness can be 
approximately 60 percent higher due to the remoteness of work 
sites within wilderness and requirements by the Wilderness Act 
that non-motorized, primitive tools and techniques be used in 
wilderness administration. The nature of wilderness activities 
results in increased travel and person time to operate and 
maintain.
    Question. The agency budget justification refers to a 
reconstruction backlog of $267 million. The fiscal year 1997 
agency testimony to the Subcommittee also refers to a backlog 
of $267 million. With the President's budget not being met in 
fiscal year 1997 can it be assumed there was no additional 
backlog during fiscal year 1997? Agency trail reconstruction 
backlog was listed as $267 million in Fiscal years 1996 and 
1994. Please update the backlog figure or explain why it has 
remained level.
    Answer. Backlog continues to accumulate. You are correct 
that the backlog figures have not been updated since 1994. The 
Forest Service is instead, concentrating our limited resources 
(both dollars and people) on implementing a new infrastructure 
data base which should give an accurate picture of Agency 
backlogs.
    Question. The agency justification refers to hiking and 
backpacking as the two fastest growing outdoor activities. What 
percentage of use occurs between wilderness and non-wilderness 
hiking experiences?
    Answer. In ``Outdoor Recreation in the United States'' 
(Cordell and Super, April 1997), hiking increased 93.5 percent 
and backpacking increased 72.7 percent. The Forest Service does 
not maintain separate figures for wilderness versus non-
wilderness hiking experiences.
    Question. How much of the proposed increase in trail 
construction funds are planned as a result of expected 
increases in recreation use attributable to the 2002 Olympics? 
What specific partnerships have been developed for this effort?
    Answer. The Intermountain Region, which includes Utah, has 
a fiscal year 1998 initial allocation of $2.6 million in trail 
re/construction funds--about a half million more than fiscal 
year 1997. The Region estimates approximately $400,000 of the 
fiscal year 1998 trail re/construction budget will be used for 
trail associated with the 2002 Olympics. Partners contributing 
cash, materials, or labor in kind or all three include: 
Snowbasin Ski Resort; Utah State University; Uinta Visitor 
Association; Utah Dept. of Natural Resources; ISTEA funds; 
Idaho Department of Transportation, and Blaine County 
Recreation District for the Boulder Mountain Trail, and 
potentially the Great Western Trail Association for the Upper 
Goosberry Trail.
    Question. What portion of trail construction and 
reconstruction funds are specifically targeted for persons with 
disabilities? What is the past 3-year history for this type of 
expenditure?
    Answer. Typically an average of 10 percent of trail re/
construction funds are targeted for universal access, including 
such improvements as hardened surfaces, access to fishing, 
parking lot and toilet improvements at trailheads, and access 
to interpretive trails.

                     purchaser road credit program

    The administration proposes to eliminate the use of 
purchasesr road credits.
    Question. A letter from the National Association of 
Counties states that the Forest Service proposal to eliminate 
purchaser road credits will reduce county revenue by an 
estimated $12.5 million. Is it true that by eliminating use of 
purchaser road credits, less funds will be available for 
distribution to states and counties? If so, what steps can be 
taken to mitigate this problem?
    Answer. In fiscal year 1996 the purchaser road credits was 
$41,290,899; therefore, eliminating the purchaser road credits 
program would reduce the payment to the states (counties) by 
estimated $10,322,724 per year. However, the Administration is 
very concerned about the effects on payments to states and 
support holding the states and counties harmless from any 
reductions.

                       midewin tall grass prairie

    Question. The formal transfer of land from the military to 
the Forest Service did not occur until recently. What is the 
current status of management plans to open the Midewin to 
public use. How will such use be phased in? Is attention being 
given to those functions which will provide the most service to 
the public and which will maximize receipts?
    Answer. A comprehensive management plan for the Prairie is 
in progress that will address public access and use. In the 
meantime, a business plan to implement a Recreation Fee 
Demonstration Pilot at Midewin has been completed and submitted 
for approval by the Regional Forester. Prior to construction of 
visitor facilities, public use will be under permit for such 
activities as wildlife viewing tours and limited forms of 
hunting. As construction of appropriate facilities is 
completed, these areas will also be opened to public use under 
the fee program. Service to the public is being provided where 
possible by those functions that are not in conflict with the 
basic purposes for which the Midewin National Tall Grass 
Prairie was established.
    Question. What is the status of the Midewin's organization 
in terms of staffing which will serve the public users? Is the 
Regional Office in Milwaukee providing the full range of 
support services?
    Answer. The Midewin is currently staffed with 18 persons 
from the Forest Service, Illinois Department of Natural 
Resources, and Will County Forest Preserve District. The FS 
employment includes the Prairie Supervisor, the Prairie 
Parklands Macrosite Coordinator, Law Enforcement Officer, 
Public Affairs Officer, Recreation/Lands Officer, 
Horticulturist, Planner, Clerk, Computer Specialist, and 4 not-
to-exceed positions (receptionist, Computer Tech, Biology Tech 
and Volunteer Coordinator). Detailers also supply Midewin with 
services in order to accomplish the program of work. Actions 
are currently underway to fill a few vacant positions.
    The Shawnee National Forest, the Eastern Regional Office, 
and the Southern Region are providing administrative services 
to the Midewin. Kent Austin, Midewin Supervisor reports 
directly to the Regional Forester and the Regional Office works 
with Midewin like other Forest units to ensure program 
accomplishment. The majority of personnel, computer, purchasing 
and procurement services are provided by the Shawnee NF with 
technical assistance from the Regional Office, when necessary. 
The Eastern Regional Office also provides technical assistance 
in the lands, engineering, and law enforcement programs, and 
the Southern Region provides some contracting services. This 
shared services approach is in line with the Eastern Region's 
plan to streamline processes and cross boundaries where 
practical to provide Midewin with administrative services that 
are both more efficient and effective.
    Question. What is the estimated percent of lands from the 
Midewin which will be allocated to non-public uses such as 
agriculture, recreation residences, and other exclusive uses? 
What are the estimated receipts for these purposes?
    Answer. There will be no recreation residences or other 
similar exclusive uses located at the Midewin. The primary 
purpose of the Midewin National Tall Grass Prairie is to manage 
the land in a manner that will conserve and enhance the native 
populations and habitats of fish, wildlife, and plants. Until 
the planning process is completed, an estimate of the percent 
of lands that will have restricted public use will not be 
known.
    Question. Assuming the Recreation Fee Demonstration project 
is retained; when Midewin unit is fully functional, can it be 
expected that operations will be able to occur solely based on 
fees paid by the using public? What are operations cost 
estimates for this unit? What are income projections? What are 
the predominant expected uses?
    Answer. When fully operational, our objective is for 
Midewin to be able to function based entirely on user fees. The 
operations costs, income projections, and predominant expected 
uses will be highly variable until the planning process is 
completed, consequently estimates at this time would not be 
prudent.

                                kv funds

    Question. What is the status of the KV fund nationwide in 
terms of cash on hand and to be collected, versus the cost of 
work to be accomplished with brush disposal funds?
    Answer. The cash on hand in Knutson-Vandenberg (K-V) Trust 
Fund accounts as of the end of fiscal year 1996 totalled 
approximately $106 million. In fiscal year 1997, $202 million 
was repaid to the K-V Trust Fund as partial repayment for K-V 
advances for emergency firefighting purposes. Additionally, we 
anticipate about $151 million from K-V collections from timber 
harvest during fiscal year 1997 bringing the total available 
balance to about $459 million. We assume that the second half 
of your question is aimed at knowing the cost of the K-V work 
to be accomplished in fiscal year 1997, rather than brush 
disposal work. We anticipate K-V expenditures for renewable 
resource work specified on sale area improvement plans will 
total approximately $218 million in fiscal year 1997.
    Question. What is the status of money ``borrowed'' from the 
KV fund for use in fighting fires during the 1996 fire season?
    Answer. Fiscal year 1996 began with a balance of $420 
million owed to the KV trust fund for prior year fire fighting 
costs. During fiscal year 1996, an additional $225 million was 
borrowed for emergency fire suppression.
    In fiscal year 1997, Congress appropriated $550 million in 
emergency funds which could be used to help replenish the KV 
fund. The President released $300 million thus far. Of this 
amount, $202 million was transferred to the KV fund. The other 
$98 million was retained in the emergency firefighting account 
to cover fiscal year 1996 obligations. Approximately $443 
million is still owed the KV fund.

                   land acquisition and land exchange

    Question. The Forest Service and Plum Creek Timber Company 
have apparently agreed on an exchange of land near the Alpine 
Lakes Wilderness Area. Based on the need to coordinate 
extensively with local publics what indicators do you have 
regarding the potential success of implementing this exchange?
    Answer. The Forest Service and Plum Creek Timber Company 
(PCTC) have signed an Agreement To Initiate a proposed land 
exchange in the I-90 corridor near the Alpine Lakes Wilderness.
    There is significant support from the environmental 
community for this exchange proposal. Most parties agree that 
Federal acquisition of many of the PCTC inholdings are in the 
public interest to protect endangered species habitat,and water 
quality; improve ecosystem management and provide recreation 
opportunities. There is also major support from Mountains to 
Sound Greenway Trust organization. This is an organization of 
key leaders from County Government, industry, environmental 
organizations and various other organizations in the Seattle 
area.
    Kittitas County has concern about losing additional tax 
base within the County. Almost all of the PCTC lands are within 
the County. However, recent conversations between the County 
Commissioners, Forest Service and Plum Creek indicate that the 
County may not oppose this exchange if revenue losses to the 
County are minimized.
    The Exchange proposal includes lands involving fourteen 
federally recognized tribes. There may be an issue with the 
tribes in regards to Treaty rights on the federal lands 
proposed to be exchanged.
    Forest Service and Plum Creek are starting the scoping and 
public involvement process. A letter with maps of the proposed 
exchange has been mailed to over 4,000 individuals and 
organizations asking for public input to this proposal. In 
addition, four public meetings will be held over the next three 
weeks to gather public comments on the exchange proposal. The 
agency will have a better feel of how supportive or non 
supportive the public is of this exchange proposal when we have 
completed the public scoping process.

                           general questions

    Question. The General Accounting Office states (GAO/OCG-97-
2) that significant savings are not likely to occur when the 
Forest Service, Bureau of Land Management, National Park 
Service, and Fish and Wildlife Service share resources. The 
Congressional Budget Office states that significant savings can 
only occur when operational functions are consolidated. The 
Forest Service and BLM have collocated some offices and shared 
some space. What actual consolidation of functions are being 
considered by the two agencies? Is there any active 
consideration of functional consolidation occurring involving 
the 4 land management agencies?
    Answer. The Forest Service is evaluating and searching for 
ways to consolidate functions with other land management 
agencies, where feasible. Most consolidations of functions have 
been on a local scale with the Bureau of Land Management. For 
example, the BLM and FS may jointly fund the salary and 
expenses of a wildlife biologist to conduct work on both FS and 
BLM lands.
    The Fire and Aviation Staff in the Pacific Northwest Region 
has consolidated with the BLM Fire Staff to provide regional 
leadership for both agencies. Another example is on the Fremont 
National Forest, where the FS, BLM, USF&WL, and State of Oregon 
are operating a consolidated Interagency Fire Center. The fire 
organizations in the four land management agencies also work 
together by sharing information and resources.
    There are numerous examples of current and proposed 
consolidations of functions between BLM and FS. Specific 
examples are:
    Northern Region--the Idaho Panhandle National Forest 
receives range management expertise from BLM while the Forest 
provides engineering assistance to the BLM. These agencies also 
share Geographic Information Systems information. The Nez Perce 
National Forest provides cadastral, design, construction, and 
inspection engineering support for BLM.
    Rocky Mountain Region--in the next 3 to 5 years, the White 
River National Forest is considering a proposal to consolidate 
the functions of three Districts with BLM lands and will manage 
both BLM and National Forest system lands from these offices. 
The Forest may also create an Associate Forest Supervisor 
position who will oversee BLM interests, collocate the 
headquarters offices in Glenwood Springs (FS) and Meeker (BLM), 
integrate leadership teams, co-manage range allotments, share 
road maintenance equipment, share project or watershed level 
planning, develop common communications between agencies, 
monitoring standards, interagency map and integrate GIS.
    The San Juan/Rio Grande National Forest currently share 
four line officers who are delegated the authority to do 
business for both the FS and BLM. One is both the Associate 
Forest Supervisor (FS) and the Area Manager for the San Juan 
Resource Area of the Montrose District of BLM. The other three 
line officers, located in the San Luis Valley, have the full 
authority to manage respective geographic parcels of both FS 
and BLM Lands. The Forest also has a joint campground 
concessionaire contract with BLM that is administered by one 
agency.
    The FS provides all fire suppression and prevention for the 
San Luis Resource Area of the BLM and on some isolated parcels 
near Pagosa Springs. The BLM provides the Minerals expertise 
for all the FS lands in the San Luis Valley.
    BLM and FS are cooperating to build an Integrated Resource 
Inventory of the five million acres in southwest Colorado. An 
integrated Geographic Information System is also in the early 
phases and will allow a number of agencies to make decisions 
based on broad landscape level rather than individual parcels.
    The Forest Health Management Staff provides services to all 
federal land management agencies (BLM, DOD, NPS, BIA, and state 
foresters) in regard to detection, evaluation, suppression of 
forest insect and diseases. The Gunnision Service Center is 
jointly housed with NPS and BLM.
    The Pike/San Isabel National Forest's ``Trading Post'' with 
the BLM involves the sharing of office space, professional 
expertise, administrative support, telephones, data general 
computers, copy machines, typewriters. Many functions have been 
consolidated.
    Southwest Region.--The region, BLM, and NPS are involved in 
sharing fire control resources, including integrated buying 
teams, incident command system teams, dispatch, etc. The Region 
also shares training expertise and facilities with other land 
management agencies. The Santa Fe Supervisor's Office and the 
BLM also share office space and some common services.
    Intermountain Region.--The Region has numerous shared or 
consolidated functions with BLM. Agency engineers help design 
BLM offices and a growing number of joint Visitor Centers are 
shared with BLM.
    FS and BLM employees work together on efforts such as 
shared monitoring and inventory crews with states and BLM. The 
region is also involved in sharing other resources with BLM, 
such as road maintenance (including equipment), law 
enforcement, fire suppression activities with the National 
Inter-agency Fire Center in Boise, shared Dispatch Centers in 
Utah, Nevada and Idaho, and fire suppression property. A large 
effort is also ongoing with the Geometronics Service Center to 
share mapping services.
    Data bases, primarily resource, are shared with the states 
and Interior federal agencies. This includes shared research 
surveys with other agencies including BLM.
    Pacific Southwest Region.--The region is currently involved 
in sharing radio facilities, equipment, and other expertise 
with BLM. The Modoc National Forest provides a forklift and a 
conference room to BLM.
    Pacific Northwest.--The Rogue River National Forest shares 
computer equipment, realty appraiser, and road maintenance work 
and equipment with BLM and NPS. The Forest also provides excess 
property services, office space, and stream surveys for BLM.
    The Umpqua National Forest shares geotechnical engineering, 
engineering/resource geology, engineering design reviews of 
bridges, roadway structures and road designs, some heavy 
equipment, road maintenance, with Roseburg BLM Office. The 
Forest shares a recreation position with Eugene BLM and office 
space with Roseburg BLM.
    The Malheur NF shares office/reception with BLM/NPS/APHIS 
and shares GIS services with NPS, and provides fleet 
maintenance for BLM and NPS. The Forest shares a tribal 
liaison, trails manager, range conservationist, and 
archeologist with BLM, along with many other services.
    The Central Oregon Interagency Dispatch Center includes the 
FS, BLM, and Oregon Department of Forestry employees.
    The BLM, as well as the Deschutes and Ochoco National 
Forest archaeologists are working together to manage the 
heritage resources and customer service events, such as the 
Passport in Time, for the Deschutes Province as a seamless unit 
between FS and BLM.
    The Prineville BLM District and the Ochoco and Deschutes 
National Forests have collectively hired a person who works as 
the Tribal Liaison Officer for both FS and BLM.
    The Ochoco National Forest Fire Management Officer is a BLM 
employee who manages both the FS and BLM Fire program. The 
Administrative Officer for BLM is a FS employee who also 
continues to serve as the Ochoco National Forest Administrative 
Officer.
    The Prineville BLM District has approximately 13 FS 
employees performing work for the District, and the Ochoco 
National Forest has 2 BLM employees working on FS work.
    The FS and the BLM are working on developing a single 
firewood permit for all of Central Oregon's public lands; an 
interagency cooperative approach to range management; an 
interagency cooperative effort to manage the Federal Recreation 
services in Central Oregon; and we are studying shared 
administrative services, fleets, engineering services and 
leadership.
    The Regional Ecosystem Office is a joint interagency (BLM, 
FS, NMFS, EPA, BIA, NPS) consolidated office for implementing 
the President's Northwest Forest Plan.
    Eastern Region.--The region supports the ``America's 
Outdoors: Center for Conservation, Recreation and Resources'', 
an interagency natural resource center, located at the Eastern 
Regional Office in Milwaukee, Wisconsin. The center is jointly 
funded and managed by the Forest Service, Bureau of Land 
Management, and National Park Service. The center provides 
``one-stop shopping'' for natural resource information, 
including trip planning, environmental education, and 
conservation projects. America's Outdoors was awarded the Vice 
President's Hammer Award in 1996 in recognition of its 
accomplishment in reinventing government.
    The Minnesota Interagency Fire Center, located in Grand 
Rapids, Minnesota, is multi-funded and managed by the Forest 
Service, National Park Service, and U.S. Fish & Wildlife 
Service, as well as the Bureau of Indian Affairs and the State 
of Minnesota. The Center provides coordination of emergency 
support for fires, floods, and other disasters within Minnesota 
and nationwide, on request, including firefighting crews, 
aircraft, supplies, and other needs. The Center also operates 
the Smokey Bear National distribution center.
    Research.--The Forestry Sciences Laboratory in Athens, GA, 
is sharing survey research technology, data sets, and report 
development with BLM and NPS.
    Question. In February 1997 the Department issued a report 
on Civil Rights at the Department of Agriculture. This report 
called for development of actions to alleviate real and 
perceived discrimination. (1) What action is the Forest Service 
taking to implement findings of this report? (2)(a) What action 
is the Forest Service taking to eliminate the large backlog of 
civil rights complaints? (2)(b) Some statements at recent 
listening sessions alleged that the Agency and Department are 
paying large sums of money to ``settle'' cases before they are 
properly adjudicated. What is agency position on settlement of 
EEO cases prior to full adjudication? (3) What are statistics 
for the past 5 years on agency payments for EEO complaint 
resolution (including civil settlements) and the number of 
complaints resolved as part of those settlements? What is the 
past 5 year data on pending complaints at the end of each 
fiscal year?
    Answer. The Forest Service is taking the following actions 
to implement recommendations in the Civil Rights report:
    In the next few months there will be considerable work done 
to implement the Secretary's Civil Rights Action Plan (CRAT). 
The USDA has 31 active teams currently assigned to implement 
the recommendations in the Secretary's civil rights report. 
Forest Service employees are serving on 16 of those teams which 
will provide the framework for all USDA agencies' 
implementation responses. Tom Thompson, Deputy Regional 
Forester for Resources from the Rocky Mountain Region, has been 
appointed to lead an Incident Command Team. The concept for 
this team is to mobilize resources to implement the report 
recommendations. Several Forest Service focus work teams have 
been chartered, under the direction of Tom Thompson, to develop 
implementation plans for specific portions of the CRAT report. 
Most of the specific actions identified in the CRAT report need 
to be implemented by the Forest Service. Some actions will 
require significant work while others may need minor civil 
rights program shifts and adjustments. The Forest Service is 
moving ahead with the implementation plans by working closely 
with CRAT teams in the Department.
    The Chief has met with all Regional Foresters and Station 
Directors and directed that they become personally involved in 
resolving all complaints within their authority. The Department 
has teams looking at employee and program delivery complaints. 
The goal is to resolve all complaints by the latter part of 
June 1997. The Forest Service is actively helping the 
Department achieve this goal and has assigned several employees 
to the Department's complaint team.
    Each Region and Station has established a ``rapid 
response'' team to seek resolution of its EEO complaints. The 
work of these teams is coordinated by the Washington Office 
Civil Rights Director and they are working in cooperation with 
the Department's Office of Civil Rights.
    The agency position on settlement of claims before 
adjudication is to work diligently with the Department to 
resolve all complaints to the satisfaction of the complainant 
and for the benefit of the government, when possible. Due to 
the length of time and costs involved in adjudicating 
complaints, our policy is to resolve complaints before 
adjudication, when possible. In cases where the complaint can 
be settled with little or no money involved and where 
continuing the case would further deteriorate relationships and 
incur substantial costs, settlement may occur prior to 
adjudication.
    Formal complaints are handled at the Department level. The 
Department coordinates with Forest Service units on settlement 
agreement terms, including payments. Compensatory damage claims 
over $2500 have been adjudicated by the Department of 
Agriculture. Settlement agreements have been signed with the 
understanding that documentation of claims would occur after 
the settlement. The documentation of claims, the investigation 
of claims, and the adjudication of claims have frequently taken 
months and even years to reach closure. The Forest Service, 
therefore, does not have all of the information needed to 
respond with any degree of accuracy regarding costs of 
settlement agreements.
    The number of formal EEO complaints filed, by fiscal year, 
are as follows:

Fiscal year:
    1992..........................................................   104
    1993..........................................................   194
    1994..........................................................   249
    1995..........................................................   250
    1996..........................................................   194

    According to Department of Agriculture reports, the Forest 
Service has resolved 307 formal EEO complaints through 
settlement agreements during the period of fiscal years 1992--
1996. However, data is not available by fiscal year.
    Question. In your January 6, 1997, remarks to Forest 
Service employees you stated that ``our financial and 
administrative houses must be in order.'' Many comments have 
been made about the negative state of the agency's financial 
records, including some members of the Senate who say the 
agency's records are ``a mess.'' What actions are you taking to 
get your financial house in order? How has your reduction of 
employment in the Washington Office affected this problem and 
the ability to fix it?
    Answer. Specific actions being taken include a joint effort 
between the Forest Service, the USDA Office of the Chief 
Financial Officer, and the USDA Office of the Inspector 
General, working as a team to address the issues necessary to 
correct deficiencies identified in the 1995 financial audit. A 
detailed action plan was developed by the team in December 
1996, which the Forest Service began implementing in January 
1997. These actions, combined with the implementation of 
revised general ledger software by the USDA and inputting data 
into the Forest Service automated real property information 
system, will address the issues identified by the OIG.
    The reduction of staffing in the Washington Office has 
resulted in the remaining workforce simultaneously dealing with 
the ongoing, current workload while integrating necessary 
changes to bring the Forest Service financial house in order. 
At the Washington Office, field personnel from throughout the 
Agency have been called upon to assist in making necessary 
changes and improvements.
    Question. What is the status of implementation of the IBM 
computer equipment to replace the Data General? How far behind 
schedule is this effort? In light of the very fast 
transformation of information technology, will the equipment 
still have a reasonably functional life once fully implemented?
    Answer. The Forest Service requested a waiver from the USDA 
Information Technology Investment Moratorium on April 18, 1997, 
to proceed with implementation of Project 615. The waiver was 
received on May 1, 1997, and orders were submitted to IBM to 
begin implementation.
    We are now back on schedule to be fully implemented by 
fiscal year 1999. The delay caused by the USDA Moratorium can 
be regained this fiscal year by expediting orders through the 
summer. The combined orders, when added to the installed base 
of 5000 workstations, will equip about 16,000 total employees 
by the end of fiscal year 1997. In fiscal years 1998 and 1999, 
we will provide access for approximately 7,000 users per year 
to complete the implementation.
    We have continued contract updates with IBM ensuring that 
the technology is regularly refreshed and is providing a 
technology and price/performance level better than that 
originally provided in the contract. This approach ensures that 
the contract contains up-to-date technology appropriate to the 
requirements of the Forest Service. In addition, we are 
integrating personal computers into the IBM system architecture 
bringing it up to contemporary standards. By taking advantage 
of this well-integrated technology, the Forest Service will 
have the broadest range of modern technology to meet its 
business requirements.
    Question. The Forest Service has invested a great deal of 
funding in re-engineering processes. What specific reductions 
in FTE's can be attributed to specific re-engineering of 
administrative processes.
    Answer. The reengineering efforts for the Agency are aimed 
at reducing overhead costs by consolidating some Forest 
administrative offices, and at improving efficiencies by 
improving work processes and delegations to enable us to 
effectively accomplish our mission. However, FTE reductions 
have not been tied directly to reengineering efforts, but more 
so in response to the Administration's (NPR) overall direction 
to reduce the number of administrative positions. Since 1992, 
the Forest Service has reduced its administrative workforce by 
15 percent.
    Question. Despite numerous efforts to reduce field level 
personnel organizations, fully operational Personnel Management 
organizations exist on most National Forests and in every 
region. Extensive efforts to streamline the organization has 
failed to consolidate functions and reduce Personnel Office 
substantially. What is the current level of FTEs in the 
Personnel Management function by series for the past 5 years, 
and what is the number of full service personnel offices 
comparatively for the past 5 years? With general administration 
funds being reduced, why does the agency continue to maintain 
this number of offices?
    Answer. Many forests no longer have personnel offices. The 
agency is continuing to explore opportunities to reduce 
personnel offices, personnel employment, and costs. Since 1993, 
employment in the personnel disciplines has declined from 1,150 
full-time equivalents (FTEs) to 930 FTEs--an 18 percent 
reduction.
    The 5-year FTE employment for personnel disciplines 
follows:


------------------------------------------------------------------------
Series         Title           1993     1994     1995     1996     1997 
------------------------------------------------------------------------
   201Personnel                346      319      302      304      300  
       management                                                       
       specialist                                                       
   203Personnel clerk/         496      444      401      383      368  
       assistant                                                        
   212Staffing specialist       26       19       19       20       17  
   221Position                  17       13       13       10        8  
       classification                                                   
       specialist                                                       
   223Salary/wage                3        3        4        5        4  
       administration                                                   
   230Employee relations        32       26       31       33       32  
       specialist                                                       
   233Labor relations            6        6        5        8        6  
       specialist                                                       
   235Employee                  33       35       28       24       23  
       development                                                      
       specialist                                                       
   260Equal employment          70       65       64       58       57  
       opportunity                                                      
      Other personnel          121      118      113      120      124  
       related support,                                                 
       such as reception,                                               
       typing, computer,                                                
       et cetera                                                        
                          ----------------------------------------------
          Total               1150     1048      980      965      939  
------------------------------------------------------------------------

    The number of personnel offices for the past 5 years 
follows:

Number of personnel offices

1993..............................................................   115
1994..............................................................   114
1995..............................................................   117
1996..............................................................   126
1997..............................................................   104

    The agency is actively reducing the number of personnel 
offices and saving money, and will take every practical 
opportunity to continue with these efforts. The cost associated 
with transfers, reduction-in-force, or retraining employees is 
often greater than the savings realized through consolidation, 
not to mention the adverse effects it would have on morale and 
productivity. In the past year, we closed 22 personnel offices. 
We expect this trend to continue at minimal expense to the 
taxpayer.
    Question. What specific action will be taken to improve 
financial management weaknesses identified by the General 
Accounting Office and the Office of the Inspector General?
    Answer. Specific actions which will, or have been taken to 
address shortcomings in financial management at the Forest 
Service occur in several broad areas. To date, we have made 
much progress, including:
    Formation of the Financial Health Task Group comprised of 
staff from the Forest Service, the Office of the Chief 
Financial Officer, the Office of the Inspector General, and 
occasionally including a representative of the General 
Accounting Office. This group provides continuing oversight to 
assure that actions occur.
    The Financial Health Task Group caused the creation of a 
financial health plan covering broad areas, and published that 
document during December 1996. That plan was supplemented by 
all of the Regions and Stations during February and March, and 
is the basis for on-going monitoring visits by the OIG 
consultants tasked by the Financial Health Task Group.
    The Financial Health Task Group also caused the creation 
and publication of a Desk Guide to be used by the Forest 
Service staff in addressing the areas of weakness. That guide 
was distributed during June, 1997, and provides in one concise 
document all of the information necessary for staff working on 
improving the quality of financial management information.
    In the area of Accounts Payable, and Accounts Receivable, 
permanent solution is not possible until the Department's 
Foundation Financial Information System (FFIS) is operational. 
This system will begin pilot testing in one-third of the Forest 
Service units on October 1, 1997. If it is successful, it will 
be expanded to the remainder of the Service on October 1, 1998. 
In the interim, the Financial Health Desk Guide provides 
detailed instructions on how to properly handle both payables 
and receivables.
    In the area of Revenue and Reimbursements there have been 
several changes. Part of Forest Service's data quality problems 
came from an automated process used in prior years at year end. 
That process has been discontinued as it created more 
difficulties than it solved. The publication of the desk guide 
referred to above provides detailed instructions as to how to 
code these types of transactions properly, and that has been 
distributed to all units. Finally, considerable attention has 
been given to making certain that the units get their records 
corrected and current.
    In the area of Property, Plant, and Equipment, there have 
been several actions taken to improve data quality and systems. 
The USDA will shortly issue revised instructions as to the 
capitalization threshold for Real Property. Forest Service is 
in the final stages of creating an automated subsidiary ledger 
(INFRA) which will capture information on all constructed 
features on a national forest. This data will include both cost 
and depreciation information. We expect that this system will 
be operational beginning in fiscal year 1998, and will have 
accurate, inventoried data by the end of that fiscal year.
    Personal Property is currently being inventoried, and we 
are expecting that by the close of fiscal year 1997, all of our 
inventories will be up-to-date. The Department has published a 
change to the capitalization threshold to $5,000, which has 
been implemented by the Forest Service.
    As stated above, the Financial Health Task Group has 
engaged the OIG as consultants to monitor and report back on 
the progress being made by the field units. The Inspector 
General reported to the Chief of the Forest Service in July 
that the results of the monitoring visits on three regions had 
shown ``significant improvement'' in the quality of 
information. These visits will continue until mid-August, at 
which time they will have visited each Region and Station in 
the Service. We have continuing discussions on the progress of 
the work, and expect the OIG to issue a final consulting report 
shortly after completion of the visits.
    Question. There are reports that payments for workplace 
disabilities (OWCP payments) cost the agency several million 
dollars per year. How much money is being paid for OWCP 
currently? What is the past 3-year history? What action is the 
agency taking to provide employment to former employees who are 
receiving OWCP payments in jobs they can perform? What specific 
savings have resulted from these actions? What action is the 
agency taking to eliminate current and former employee fraud 
relative to OWCP claims?
    Answer. We estimate that fiscal year 1997 OWCP costs for 
the agency will be $27,130,846. The costs for the 3 previous 
years were $25,665,054 (FY 1996), $26,924,938 (FY 1995), and 
$27,997,611 (FY 1994).
    The agency's OWCP program is designed to identify claimants 
who are likely to fully recover from their injury/illness, 
place them in positions they can perform while recuperating, 
and later return them to their original jobs. This program 
ensures that a position is reserved and offered when claimants 
recover. We have also established four full-time Workers' 
Compensation Program Manager positions in the field. These 
positions focus on reducing long-term claims and costs through 
rehabilitation and reemployment of claimants. We continue to 
try to place the employees in positions that they can perform.
    Our Workers' Compensation Program Managers are actively 
working with claimants and personnelists to eliminate current 
and former employee fraud by reviewing all long-term claims, 
controverting claims that are not clearly job-related, and 
ensuring, when appropriate, that third party recovery is made. 
In the past 3 years, it is estimated that these cost reduction 
efforts have saved $2.5 million.
    Question. How has the agency integrated the Government 
Performance and Results Act into it(s) performance measures for 
accomplishment in the fiscal year 1998 budget process? There 
does not appear to be a direct tie between accomplishments 
planned as part of the agency budget justification and the 
agency's draft fiscal year 1998 GPRA Performance Plan. For 
example, there is a difference in comparing fuel treatment 
acres in the budget justification, which plans accomplishment 
of 1,000 acres (total of brush disposal and hazardous fuels 
reduction), versus the GPRA action plan which proposes to treat 
1,250 acres. In the recreation management program there appears 
to be no tie between accomplishment measures in the agency 
justification vs emphasis in the GPRA action plan.
    Answer. In July 1996, the Forest Service submitted to the 
Department of Agriculture a list of performance goals and 
indicators with planned accomplishment levels consistent with 
its Agency Request (i.e., highest budget request level). These 
goals, indicators and planned accomplishment levels were 
incorporated into the agency's draft annual performance plan 
for fiscal year 1998. At the same time, planned accomplishments 
for these indicators were being adjusted to reflect the program 
funding levels in the fiscal year 1998 President's Budget. 
These adjusted planned accomplishment levels were displayed in 
the agency's Budget Explanatory Notes. This is the source of 
the discrepancy between some of the numbers in the Explanatory 
Notes and the Draft Performance Plan.
    Question. With the intent to implement GPRA in fiscal year 
1999, will the tie between GPRA and the annual budget 
justification be readily apparent?
    Answer. Yes. It is the agency's intent to integrate GPRA 
performance goals and indicators into all steps of the budget 
process including budget justification.
    Question. With full implementation of GPRA, will the agency 
realize any efficiencies by reducing work on other planning or 
accomplishment efforts?
    Answer. We feel that the strategic planning and annual 
reporting processes required by GPRA are quite compatible with 
similar requirements the agency has under the Forest and 
Rangeland Renewable Resources Planning Act (RPA). The GPRA 
requirement to develop an annual performance plan has also been 
integrated into the agency's budget process. As a result, 
existing staffs should be able to handle the GPRA workload but 
we expect no budgetary or personnel savings from this effort.
    Question. What are the anticipated effects of the 
Administration's initiative to place former welfare recipients 
in Forest Service positions? Will field level accomplishments 
be affected?
    Answer. The Forest Service estimates that we can hire at 
least 37 welfare workers per year from the welfare rolls for 
the next four (4) fiscal years. This is not expected to affect 
field level accomplishments.
                                ------                                


         Questions Submitted by Senator Ben Nighthorse Campbell

    Question. It appears that the USFS is phasing out the 
Timber Salvage Sale program in favor of a new Forest Ecosystem 
Restoration and Maintenance Fund. What does this mean for the 
timber industry? Do you plan to utilize more controlled burning 
to restore forest health at the expense of using timber sales 
to remove salvageable timber?
    Answer. There is no intent to phase out the salvage sale 
program. Rather, the objective is to create a tool to better 
manage the entire land base.
    Question. How will your Wildland Fire Management program 
improve the control of wildfires that seem to be increasing in 
number and intensity in western forests.
    Answer. We have focused a major portion of the wildland 
protection program at increasing the funding and treated 
acreage of hazardous fuel reduction. The large build-up of 
fuels throughout the western forests increases the probability 
for large, catastrophic fire. Reducing fuels, through 
mechanical treatments or the use of prescribed fire will result 
in smaller, less intense fires. This emphasis will require many 
years of fuel treatments to realize the benefits of such a 
program. It is also necessary to maintain a strong preparedness 
organization to quickly and effectively suppress fires, thereby 
preventing them from becoming large.
    Question. It appears that the elimination of the 
``Purchaser Credit Program'' will require that timber companies 
will be responsible as usual for the cost of construction of 
roads. However, the requirement that they pay these costs up-
front may cause serious financial problems for smaller 
operators. Don't you think this will cause even more of these 
small family businesses to be unable to compete for timber? 
This will also result in lower bids on timber sales. Won't this 
also reduce the payments going back into the county governments 
in lieu of taxes?
    Answer. The administration's proposal would both retain the 
Purchaser Election Program for small purchases and hold the 
states harmless from any losses in payments as a result of the 
elimination of the Purchaser Credit Program. We urge the 
Congress to adopt these proposals.
    Question. I am concerned that the increased funding going 
to the President's Forest Plan for the Pacific Northwest is 
taking funds away from other Regions. Region 2 Regional 
Forester, Elizabeth Estill, has indicated the need for 
additional funding to rebuild the timber sale pipeline in her 
Region. I understand that you are further reducing the proposed 
timber harvest in Colorado which already is having a difficulty 
maintaining an industry. Are you diverting funds from Region 2 
to go to the Pacific Northwest?
    Answer. No. The fiscal year 1998 agency request did not 
reduce the allocations to regions and forests not covered by 
the PNW Plan in order to meet the PSQ in the PNW Plan. The 
Administration recognized this cost and chose to provide 
additional funding in the President's Budget versus not meeting 
the PNW Plan or reducing other regions and forests to pay for 
meeting the PNW Plan.
    Question. Why is USFS research in Colorado being downsized?
    Answer. During fiscal year 1996, Rocky Mountain Station 
reorganized the four ecological RWU's in Fort Collins, Colorado 
into two units. This was done for two reasons; (1) to reduce 
the number of supervisory positions (Project Leaders) needed 
from four to two, thus freeing up more funds for actual 
research; (2) to create multidisciplinary units, more suited to 
addressing the complex questions that need to be answered in 
taking an ecosystem approach to wildland management. Because 
the whole Station has only two forest entomologists and two 
forest pathologists, and because of significant insect and 
disease problems in both the Southwest and the Central Rockies, 
during the reorganization, we matched scientists to research 
needs by relocating one entomologist and one pathologist from 
Fort Collins to the Flagstaff Arizona, Forestry Sciences Lab. 
To support this move, $340,000 in funds were reassigned from 
Colorado to Arizona.
    Prior to the reorganization, one scientist and one 
technician, who were located in Arizona, had actually been 
assigned to an ecological research unit in Fort Collins, and 
thus their funding was shown in Colorado even though they 
worked out of Arizona. As part of the reorganization, we 
reassigned them and $196,000 to a unit in Flagstaff Arizona.
    Another $28,000 reduction covers Rocky Mountain Station's 
share of increased support to accelerate research in 
President's Northwest Forest Plan. The final reduction of 
$75,000 in RWU-4803 reflects reassignment of the last of the 
Southwestern Consortium funds from the Station's headquarters 
to laboratory in Albuquerque New Mexico. No personnel moves 
were associated with these funds.
    Total Reduction: $639,000.
    Question. What is the methodology utilized by the USFS to 
determine the number of recreational user days?
    Answer. The Forest Service tracks recreation use by 
Recreation Visitor Days (RVD's) and by Visits. A RVD is a 
statistical reporting unit consisting of 12 visitor hours. A 
visitor hour is the presence of a person on an area of land or 
water for the purpose of engaging in one or more recreation 
activities during the period of time aggregating 60 minutes. A 
Visit is the entry of one person upon a national forest for the 
purpose of participating in one or more recreation activities 
for an unspecified period of time.
    Both RVD's and visits estimated by Forest Service field 
units and reported through a computerized reporting system. 
Various ways exist to display the information gathered: by 
Region and by State, by activity, and by year. Field estimates 
are based on the application of sampling techniques, traffic 
counters and other observation methods.
    The Forest Service is also experimenting with methods to 
improve recreation use estimates. A prototype process is 
currently being tested. It is intended to provide improved 
statistical estimate of recreation use on the national forests.
                                ------                                


              Questions Submitted by Senator Conrad Burns

    Question. Do agencies expect to meet this target in fiscal 
year 1997 as scheduled?
    Answer. The USDA Office of Forestry and Economic Assistance 
recently provided information relevant to this question in the 
report ``The Northwest Forest Plan: A Report to the President 
and Congress'' (issued December, 1996). The 1.053 billion board 
foot level included the initial probable sale quantity (PSQ) of 
958 million board feet plus an additional 10 percent of ``other 
wood.'' As noted in the 1994 Final Supplemental Environmental 
Impact Statement, ``sustainable sale estimates will be made 
using more refined data and procedures available when Draft 
Forest and District Plans are completed or current plans are 
revised.'' (FSEIS, page 3&4-267). Some individual national 
forest and BLM district plans have been completed since 
implementation of the Pacific Northwest Forest Plan and the PSQ 
has been revised as a result. The December, 1996 Report to the 
President and Congress now sets the PSQ at 868 mmbf, and total 
projected levels at 954 mmbf if you include ``other wood'' 
(page 103). It notes that further adjustments could be made as 
more plans are revised in the future. The Forest Service 
intends to fully meet its part of the current PSQ projections 
in fiscal year 1997.
    Question. What are your plans to meet the decade target?
    Answer. The report ``The Northwest Forest Plan-A Report to 
the President and Congress'' also addresses your question 
relative to the ``decadal target.'' At page 103, it states that 
``the agencies expect to meet the average annual probable sale-
quantity goals over the 10-year life of the Plan because the 
volume that wasn't offered during the first 3 years of the 
Plan, as the agencies were reestablishing the program, can be 
offered over the remaining 7 years.'' Please keep in mind that 
the PSQ could be further modified as forest plans in Oregon and 
Washington are revised, which would affect the total volume 
offered over the decade.

                       forest health and salvage

    Question. Are funds available in the Forest Service budget 
to aggressively prepare and offer salvage sales in fiscal year 
1997? How much salvage volume has been offered under the 
salvage law to date and how much do you project will be offered 
by the end of this fiscal year?
    Answer. Yes, there are currently sufficient funds in the 
Salvage Sale Fund to continue the program. The increase in 
salvage expenditures from the emergency salvage sale provisions 
did reduce the fund to a low level; however, the receipts from 
additional volume sold is replenishing the fund. The recent 
decline in timber prices has also reduced collections. Regions 
1, 3, 4, and 5 started fiscal year 1997 with less than 
desirable cash balances. Projections indicate that 1997 
collections will be sufficient to maintain the program in 
fiscal year 1997. Even though our policy is to limit each 
region's fiscal year expenditures to their previous fiscal 
year-ending, unobligated balance, Regions 4 and 5 have 
requested approval to use a portion of their fiscal year 1997 
collections for salvage sale preparation in fiscal year 1997. 
We are looking at these requests to see whether remaining 
collections in fiscal year 1997 will be sufficient for these 
two regions such that their ending fiscal year 1997 balances 
are sufficient to support a reasonable salvage program in 
fiscal year 1998. If there are unexpected additional 
expenditures in fiscal year 1997, and continued low stumpage 
prices, then this could cause problems in the unobligated cash 
balances for fiscal year 1998.
    A total of 4.606 billion board feet of salvage was offered 
under the salvage amendment, including 818 million board feet 
which was offered the first quarter of fiscal year 1997. The 
amendment expired on December 31, 1996.
    Though the salvage amendment has expired, an additional 600 
million board feet of salvage will be offered under current 
authorities during the rest of the fiscal year.
    Question. Do you share Secretary Babbitt's view that all we 
need to do is more prescribed burning and can we solve the 
forest health crisis on our national forests?
    Answer. Acting on the recommendations of the Federal Fire 
Policy Review in 1996 the Forest Service is expanding the fuels 
reduction programs. We agree that the use of prescribed fire is 
one of the most effective tools in restoring the health of our 
forests and rangeland. The Forest Service is working toward a 
target in the year 2005 of applying hazardous fuels reduction 
treatment on 3,500,000 acres. In fiscal year 1998, we plan to 
accomplish between 850,000 and 1,300,000 acres of fuel 
treatment. This represents a significant increase from 1996 and 
1997. Although a vast majority of these acres are expected to 
be treated with fire, some areas will need some type of 
mechanical treatment before fire can be safely utilized.
    Question. Has your agency evaluated the number of days in 
the year when forest fuel and air quality conditions are right 
to do prescribed burning and given those limitations can your 
agency accomplish Secretary Babbitt's optimistic targets?
    Answer. We anticipate that we will be able to carry out our 
fiscal year 1998 program of work for hazardous fuels reduction 
while meeting air quality standards. Local Forest Service fire 
managers and local authorities work successfully together to 
accomplish fire and land management objectives, resolve 
conflicts with smoke emissions, and comply with air quality 
standards. In addition, planning is underway to design larger 
and more efficient prescribed fire projects that take advantage 
of optimum burning conditions while significantly increasing 
acres treated.
    The Forest Service is also working with officials from the 
Environmental Protection Agency to assure compliance with air 
quality standards.
    Question. Has your agency assessed the risk of increasing 
the prescribed fire program on escaped burns, public safety, 
and financial liability?
    Answer. Every prescribed burn goes through a rigorous 
process which includes a risk assessment and prescribed burn 
plan which is approved by the local line officer. Public and 
firefighter safety are the agency's greatest concern. The risks 
and outcomes of wildfire far outweigh the risks associated with 
well planned prescribed fire. Prescribed fire will, in the long 
term, reduce the risk to public safety as well as the 
liabilities of additional prescribed fire applications.
    Question. The Administration is recommending changing the 
FS definition of salvage--the same definition that the agency 
has used for years. This, in my opinion, would have the affect 
of giving less flexibility and decision making authority to 
professionals in the field. Why do you want to do that?
    Answer. The salvage definition was changed by the Forest 
Service a couple of years ago to reflect the ecosystem 
management approach. It was tied to ecosystem improvement and 
rehabilitation by including dead, dying, damaged, and 
associated trees at high risk of spreading disease or insect 
epidemics. The new definition also clarified that salvage may 
include trees imminently susceptible to insect attack because 
of drought-related stress and trees lacking characteristics of 
a healthy and viable ecosystem. This definition is consistent 
with the National Forest Management Act. The salvage definition 
was also changed by the Recissions Act by including trees 
imminently susceptible to fire. This broadened the authority 
for using salvage during the period of the Rescissions Act.
    The Interagency Salvage Program Review team found that the 
definition of salvage was confusing to the public, and that the 
interpretation and application was not uniform across national 
forests and BLM districts. The proposed change would be to more 
clearly articulate the intent of salvage projects to the public 
and to provide consistent application.

                            forest research

    Question. The 1992 Blue Ribbon Coalition Report called for 
a 5-year inventory and analysis cycle. Since the 1992 report 
was issued the inventory cycle has gone in the opposite 
direction and has increased to an average of 10 years. What are 
the primary factors that have contributed to the lengthening 
rather than shortening of the inventory cycle?
    Answer. The current national FIA inventory cycle is now 12 
plus years. The cycle is controlled by three main factors; (1) 
a mandated accuracy requirement which determines the amount of 
data to be collected, (2) funding for personnel and equipment 
which determines the speed at which the data are collected, (3) 
funding for technology research and application which can 
increase efficiency and reduce the collection burden on 
personnel and equipment without sacrificing accuracy.
    The first controlling factor, accuracy, is required and 
necessary to provide quality information to make sound 
management decisions.
    The second controlling factor, funding, is the central 
issue. Since 1995, overall Forest Service Research program 
funding has declined 10 percent. During this same time period, 
FIA field program funding has increased by 3 percent. Clearly 
FIA is still a priority research program within the Agency but 
the modest increase in FIA funds have not been sufficient to 
offset the increased cost of getting personnel and equipment 
into the field. Continued funding at current levels will 
further erode the cycle unless new technology can bridge the 
gap.
    The third controlling factor, technology research, is 
difficult to maintain when cycles slip and demand for current 
information rises. However, scientifically sound research is 
critical to the application of any new technology or data 
collection method. With constrained budgets, FIA strives to 
maintain a balance between the potential gains in efficiency 
from development and application of new technology and the 
demand for shorter current cycles.

           interior columbia basin ecosystem management plan

    Questions. (a) How do you intend to incorporate the 
findings of the scientific assessment into management direction 
for on-the-ground activities? (b) Will the scientific 
information go through the NEPA process before being applied to 
the ground?
    Answers. (a) The Bureau of Land Management and the Forest 
Service have incorporated the findings of the scientific 
assessment into management direction in the Eastside Draft EIS 
and the Upper Columbia River Basin Draft EIS. Science underlies 
the construction of various alternatives. In addition, the 
agency field units are receiving training on the scientific 
assessment and its findings so that ongoing and planned 
activities will take the information into account during 
project-specific NEPA analysis. (b) Yes. The first place this 
occurs is in the draft EISs that were released in late May. 
Additionally, site specific NEPA review will occur when 
projects are developed for implementation by field units.
    Question. In a February 3rd letter to Regional Forester Hal 
Salwasser, the Eastside Ecosystem Coalition of Counties (EECC) 
state that due to the regulatory agencies involvement late last 
year, change to the draft EIS approved by the project's 
executive committee are ``unacceptable'' and ``the EECC cannot 
support the Project in the direction it is currently headed.'' 
The Coalition stated that they would withdraw their support if 
the Project does not ``significantly redirect'' itself and have 
at least one alternative that truly directs active management 
without lengthy and burdensome processes. What changes in the 
draft EIS are being explored to address the counties' concerns?
    Answer. Several meetings which identified specific 
concerns, were held this year between Project representatives 
and Coalition members. In addition, Regional Executives met 
with the Idaho Association of Counties and listened to their 
concerns, along with numerous subsequent personal contacts with 
EECC members. In response to a February 3 letter from the EECC 
and these meetings, the Regional Executives: 1) decided to 
delay identifying a preferred alternative until concerns of 
County governments could be addressed; 2) responded to the 
counties by letter (dated February 24, 1997) with specific 
responses to the county concerns, including both clarification 
intent on some of the issues, and some changes to the draft 
EISs to address the counties' concerns.
    The Regional Executives and the EECC agreed to the 
following changes at a March 6 meeting: (1) rewrite one of the 
grazing standards; (2) differentiate between the forest 
riparian ``zones'' with respect to management objectives of 
forested riparian conservation areas and permitted activities 
therein for each zone; (3) refine definitions of the words 
``protect'' and ``maintain'' as they apply in the draft EIS's; 
and (4) add language to the standard in the draft EIS's that 
specifies that road condition/risk inventories can be conducted 
in a manner appropriate for the scale of analysis (watershed 
scale v. larger subbasin scale) being completed. In addition, 
numerous clarifying changes were made in response to EECC 
comments.

                         real estate management

    Question. What is the current status of applications from 
inholders for access authorization to NFS lands for 
construction and/or use of roads? What has been the history of 
funding for processing of these applications in recent years?
    Answer. The Forest Service annually receives several 
thousand applications for new uses and occupancies of National 
Forest System lands. They include applications for access to 
inholdings within the National Forests. The agency has a 
significant backlog of applications from inholders for 
authorizations for the construction of access facilities (i.e., 
primarily roads) across National Forest System lands. The 
agency has no current mechanism by which it catalogues or 
tracks the number of such applications currently on file and 
backlogged. Applicants for authorizations who have demonstrated 
a statutory right of access across National Forest System lands 
(to an inholding) have generally been provided a higher 
priority for processing and evaluation than those applications 
for uses not associated with such a right. Funding levels in 
recent years have been such that the agency has been able to 
properly administer only existing authorizations. We have been 
able to process only the highest priority applications for new 
authorizations. Generally, the agency is able to process 
applications when the applicant pays for some of the processing 
costs.

                              forest roads

    Question. What impact will the elimination of Purchaser 
Road Credits have on the ability to meet the timber sale 
targets under the President's Northwest Forest Plan and meet 
your objectives for improving forest health?
    Answer. There will be little to no effects on our ability 
to meet timber sale targets or to meet our objectives for 
improving forest health, since the amount of road access is not 
affected.
    Question. Do you have enough funds to repair all the forest 
roads damaged by last year's record rainfall and flooding? If 
not, what impact will these unrepaired roads have on salmon 
habitat, fire prevention and suppression, recreation access, 
and timber sale access?
    Answer. Funds for emergency repair of Forest Service roads 
are made available through two sources: the Federal Highway 
Administration Emergency Relief Federally Owned (ERFO) road 
program and appropriated road funds in the Forest Service 
budget. Preliminary estimates of road damage indicates ERFO 
needs of $90 million to repair forest roads to pre-flood 
condition, needs of $12 million for road repairs that are not 
covered by ERFO, and needs of $10 million to fund additional 
road maintenance work caused by last years storms. As snow 
melts in the high country, we can access the damaged areas to 
do the field work necessary to complete the damage reports and 
provide better estimates for necessary road repairs. Additional 
damage reports are being prepared for roads damaged by more 
recent floods in South Dakota.
    Preliminary estimates of ERFO needs have been provided to 
the Federal Highway Administration and we are waiting for their 
decision on the funding. There is some question as to annual 
ERFO funding authority being sufficient to cover the total 
qualified work. Without funding approval, we will not be able 
to perform the work.
    Funding for non-ERFO repair needs were not included in the 
current year's budget. Congress recently approved a 
supplemental appropriation of $39,677,000 for the National 
Forest System (NFS) and $27,685,000 in reconstruction and 
construction funds for emergency expenses resulting from 
flooding. Without the supplemental appropriation, we would not 
have been able to complete the additional flood damage repairs 
without causing major disruptions to our regular program of 
work. Supplemental appropriations are adequate to cover 85 
percent of the highest priority needs for NFS damage identified 
as of May 1, 1997, including road maintenance, and the 71 
percent of the highest priority needs for reconstruction and 
construction identified as of May 1, 1997, including road 
repairs. The determination of road priorities in relation to 
other repair needs will be made at the regional level and may 
vary from region to region.
    Funding for our regular road maintenance program is 
provided through normal FS appropriated funds. Under the 
current funding levels we are able to maintain only forty 
percent of the forest system roads to the standards established 
for the current use. Funding the additional road maintenance 
needs caused by the floods from our regular appropriation would 
severely impact our already limited routine maintenance 
program.
    Without additional funds, repair of damaged roads will be 
delayed or left undone. Sediment derived from roads is the 
single largest source of non-point pollution in managed 
forests. Failure to properly maintain roads increases erosion 
and sediment inputs, particularly fine sands and silts which 
damage fish spawning and rearing areas for critical salmonids.
    Reduced access for fire prevention and suppression could 
require the expenditure of additional fire fighting funds to 
open roads for fire access. This will cause delays in response 
time, resulting in more acres burned by wildfires, unnecessary 
resource losses, and additional threats to life and property 
on-site and downstream.
    Roads posing significant safety or resource concerns will 
be closed until repairs can be made. This will cause lost 
recreational opportunities, continued erosion and resultant 
sediment impact on streams, lakes, riparian areas, and related 
fisheries and wildlife resources. Quantifying specific impacts 
is not possible within funding and time constraints provided.
    Question. You are recommending a $12 million cut in 
appropriated funds for roads and an elimination of the 
purchaser road credit program. This will cut the timber sale 
program by approximately 25 percent. Is this your intention?
    Answer. No, this is not our intention, and it will not cut 
the timber sale program by 25 percent. The proposed budget 
assumes fewer sales in roadless areas and the consequent need 
for less timber road support funding. Agency direction is to 
minimize entry into roadless areas, and proceed only where 
determined necessary through the NEPA process and public 
involvement.
    Funds for timber roads are adequate to administer road work 
on existing sales and to prepare surveys and designs for the 
fiscal year 1998 green sale program of 2.505 MMBF. This is the 
planned green sale volume for fiscal year 1998.
                                ------                                


              Questions Submitted by Senator Pete Domenici

    ``Attitude shift away from timber production'': 
Historically, the Forest Service has concentrated its resources 
on the production and sale of timber and pulp wood. Over the 
past decade, the number and size of timber sales has declined, 
and the Forest Service has shifted its focus to other 
activities such as recreation and wildlife management.
    Question. What steps has the Forest Service taken to 
accommodate this shift in emphasis away from its historic 
reliance on timber production and sales from National Forests?
    Answer. While timber management and timber sales are still 
important agency programs, the Forest Service has adopted an 
ecosystem management approach. Sustaining and restoring the 
health, productivity, and diversity of the ecosystem is 
essential to our ability to continue to provide multiple 
benefits from public lands.
    Question. Does the Forest Service expect recreation and 
related activities to continue to play an increasingly 
important role in forest management?
    Answer. Yes. Recreation use projections clearly show 
increasing demand for recreation opportunities on the national 
forests. Recreation use is expected to top 1.2 billion visits 
by the year 2040. Recreation is one of the key multiple uses 
provided by the national forests. Several million private 
sector jobs are associated with recreation on the national 
forests making it a key component of the National, and many 
local, economies. The growing importance of recreational 
opportunities in the national forest is being recognized in 
overall forest management.
    Question. What program and activities does the Forest 
Service expect to be available for on-the-ground management of 
renewable resources within the National Forest System?
    Answer. We anticipate continuing to provide a full 
complement of resource management activities on the ground in 
the future, as we do now, with no specific program deletions or 
additions being planned. We remain committed to the goals 
outlined in the Forest Service document ``Course to the 
Future'' which affirm the multiple-use principles of sustained-
yield management which have guided National Forest System 
management for the last half of this century. Within that 
framework, National Forest System management today emphasizes 
maintenance of ecosystem health as well as restoration of 
deteriorated ecosystems in order to sustain the production of 
all the uses, values, products and services which derive from 
the national forests, including timber, forage, fish and 
wildlife, recreation, wilderness and water.
    Question. What kind of revenue-producing activities does 
the Forest Service anticipate will replace lost timber sales 
receipts that have historically supported forest management 
activities within the National Forest System?
    Answer. The agency does not have legislative authorities to 
use revenues generated from non-timber sale activities for 
forest management activities except deposits from timber sales 
to the salvage sale fund and the KV fund. These funds available 
in these accounts are sufficient to support the current program 
level.
    Question. What is the Forest Service currently doing to 
assist small rural communities in and near National Forests 
whose local economies have been devastated by declining timber 
production on which they have historically depended?
    Answer. The Forest Service is in its sixth year of 
implementing the ``National Forest-Dependent Rural Communities 
Economic Diversification Act'' through the Economic Recovery 
program. Since the beginning of the program in fiscal year 
1992, the Agency has gone from assisting 185 natural resource-
dependent rural communities annually to over 800 in fiscal year 
1996 through Economic Recovery efforts alone. In recent years, 
the Economic Recovery program for dependent communities has 
received between 30 to 40 percent of the Economic Action 
Programs' appropriation. Other Economic Action Programs 
provided assistance to an additional 760 communities, 
businesses, or organizations in fiscal year 1996.
    From the Forest Service, rural communities have received 
direct financial and technical assistance to build local 
capacity to manage the challenges they face and to find 
sustainable solutions for economic, social, and environmental 
problems and opportunities. In addition to specific funded 
programs, the Agency has been able to offer much more 
assistance due to the presence of its employees and facilities 
in the communities.
    Many stories are being told of progress and change in rural 
communities around the country which have taken advantage of 
the Economic Recovery program: forming local, diverse community 
action teams, even in areas known for past conflict and 
divisiveness; creating strategic plans for increased self-
sufficiency and other collective goals; improving relationships 
and increasing trust within communities as well as with the 
Forest Service and other communities, agencies, and interest 
groups; and taking responsibility for implementing plans and 
making their visions come true.

         fire suppression, presuppression, and fuels management

    The image of Smokey Bear has had a resounding impact on the 
attitude of the American public as it relates to National 
Forests and forest fires. The concentration of resources on 
fire containment and firefighting has resulted in something of 
a preoccupation with those activities, to the detriment of 
effective management of fuels that inevitably contribute to the 
catastrophic nature of many fires. In the President's budget 
request this year, the Forest Service proposes to consolidate 
the fuels management account and a considerable portion of the 
firefighting account.
    Question. How does the Forest Service believe this 
consolidation will improve their ability to reduce the 
catastrophic nature of wildfires when they occur?
    Answer. Changing the budget structure to allow greater 
flexibility in funding hazardous fuel reduction will allow the 
agency to take advantage of favorable weather conditions to 
significantly expand the number of acres treated. Hazardous 
fuel build-up is the single most important reason for 
catastrophic fires.
    Question. What activities does the Forest Service 
anticipate will receive increased priority with this 
consolidation?
    Answer. See Answer to No. 166. The primary focus will be to 
use prescribed fire wherever and whenever possible. However, to 
further reduce the risks and impacts of smoke associated with 
prescribed fire, mechanical pre-treatments will be necessary in 
many instances to allow follow-up treatments using prescribed 
fire.
    Question. How does this consolidation affect the ability of 
the Forest Service to plan for fire emergencies through the 
normal budget and appropriations process?
    Answer. The new budget structure provides increased 
flexibility in funding hazardous fuels reduction activities 
without detracting from the capability to prevent forest fires 
and to take prompt, effective initial attack suppression action 
on wildfire. The result is greater efficiencies, and over the 
long term, reductions in catastrophic fire and large fire 
suppression costs.
    Question. What impact will the consolidation have on the 
future need for emergency funding to supplement annual 
appropriations process?
    Answer. Funding needs for fire operations above the 
appropriated level would be accommodated from the government-
wide emergency contingency account.
    Question. Does the Forest Service anticipate future 
emergency funding requests to support fuels management 
activities as a result of this consolidation?
    Answer. In the President's budget, hazardous fuels 
reduction is included in the Fire Operations budget line item. 
The proposed budget is estimated at $30-$50 million allowing 
greater flexibility to respond to timely and appropriate 
applications of fuel treatment prescriptions.

                       national forest foundation

    The authorization for National Forest Foundation will 
expire this year. I intend to introduce legislation in the near 
future to reauthorize the Foundation, enabling the continuation 
of the public/private partnerships for projects related to the 
management and conservation of National Forest resources.
    Question. What kinds of activities are supported by the 
National Forest Foundation?
    Answer. The National Forest Foundation (NFF) has supported 
many projects that benefit the Forest Service. Although the NFF 
was formed by Congress in 1990, its first full year of active 
work got underway in 1993 with primary emphasis on Youth Forest 
Camps. Since the initial year, the NFF's assistance to the 
Forest Service has increased significantly, ranging from the 
establishment of a firefighting fund and scholarships giving 
financial assistance to families who lost relatives fighting 
forest fires and the support of many reconstruction and 
restoration projects throughout the agency. A state summary of 
projects already completed, currently underway or planned by 
the NFF has been provided to the Subcommittee. This summary 
contains descriptions for each project funded, including the 
location, name and work accomplished or planned. Some of these 
projects were funded entirely by the NFF while many others were 
funded in partnership with other organizations that include 
individuals, corporations, not-for-profit organizations and 
state agencies.
    In addition, the NFF has developed five major program 
emphasis areas of; (1) forest conservation; (2) forest 
protection; (3) recreation; (4) wildlife and fisheries; and (5) 
environmental education. Specific projects are listed on the 
attached sheet entitled ``Preserving the Legacy'' which has 
been provided to the Subcommittee. The NFF will launch new 
initiatives this calendar year within these five program areas 
which will support additional projects in all regions of the 
Forest Service.
    Question. Over the past 5 years, what is the total amount 
of private support that has been leveraged by the activities of 
the National Forest Foundation?
    Answer. During the period 1992-1996, the National Forest 
Foundation has received $3,695,752 in cash contributions from 
private donors and $483,608 in private in-kind contributions 
for a total of $4,179,360 to support its mission and projects. 
During 1992, the first year of the 5-year period, there were no 
active solicitations of private funds. The National Forest 
Foundation's incorporation was completed in 1993 which was its 
first full year of operations.
    Question. Does the Forest Service have any recommendations 
for changes in the National Forest Foundation authorization 
that would enhance its ability to provide even greater benefit 
to the Service, its resources, and the American people?
    Answer. Yes. There are four recommended changes we would 
suggest be made to the authorization to add to the Foundation's 
overall effectiveness. Federal regulations governing 
disbursement of grants preclude advance funding for 
administrative or project expenses to the Foundation without 
regard to when the Foundation incurs these expenses. As a 
result, the Foundation must submit frequent request to the 
Forest Service for matching funds when such costs are incurred, 
causing inefficiencies and delays in funding. To streamline the 
process and provide funding on the ground in a more timely 
manner, we recommend that the Act be amended to authorize the 
transfer of Federal funds to the Foundation in a lump sum.
    Section 410(b) of the Act, which authorizes appropriations 
up to $1,000,000 annually in Federal funds to be made available 
to the Foundation to match on a one-to-one basis private 
contributions made to the Foundation for administrative or 
project expenses, is scheduled to expire in October 1997. We 
recommend that appropriations be reauthorized for a 5-year 
period beginning on October 1, 1997, in the amount of 
$5,000,000 annually.
    We also recommend adding language to allow the National 
Forest Foundation to retain any interest or other investment 
income earned to date and in the future by the Foundation and 
its subgrantees on Federal funds drawn but not immediately 
disbursed. This language change would enable the Foundation to 
use this accrued interest and investment income to support 
additional Forest Service projects.
    Finally, we would recommend adding language that would 
enable officers and employees of the National Forest 
Foundation, while travelling on official business of the 
Foundation, to travel on the same basis as Federal employees, 
including travel on common carriers at the same rates as 
Federal employees.
    We will be happy to work with you and provide any 
additional assistance on these suggested changes to the Act.
                                ------                                


            Questions Submitted by Senator Robert F. Bennett

    Question. As you know, with the arrival of the 2002 Winter 
Olympics, the Forest Service is under a great deal of pressure 
to be prepared for the onslaught of visitors to the Cache-
Wasatch National Forest. Last year, the Committee provided 
funding for some of the initial preparations. (1) Please 
provide me with an update on how those funds appropriated for 
fiscal year 1997 have been utilized thus far. (2) Is the Forest 
Service on schedule with the preparations for 2002 Olympics? 
(3) What impact will Olympic funding have on other programs 
within the region? (4) Do you anticipate the need for 
additional funding beyond the analysis provided to the 
committee last year?
    Answer. (1) What has been done to date with $300,000 in 
fiscal year 1996 and $2,533,000 in fiscal year 1997:
    The creation of the four-person Olympic Planning Team and 
the 3-person Venue Preparation Team. These teams have begun the 
process of establishing communications with the Salt Lake 
Olympic Organizing Committee, all levels of the Forest Service, 
the Department of Agriculture, and have embarked on day-to-day 
monitoring and oversight of the Snowbasin Ski Resort land 
exchange and attendant implementation of the Master Development 
Plan.
    The establishment of a long-term partnership with the Salt 
Lake Convention and Visitor Bureau. The partnership to date is 
resulting in a cooperative effort to staff, operate and provide 
exhibits at the Salt Lake Regional Visitor Center, with plans 
currently being laid to cooperate similarly at visitor contact 
points throughout the greater Salt Lake area.
    The recreation construction funding was used to reconstruct 
7 major campgrounds in the Wasatch Front area. Most of the 2002 
projects are reconstruction of existing recreation facilities 
and restoration of adjacent damaged riparian habitat/resources. 
Therefore they will be used and enjoyed by the general public 
after the Olympics.
    Trail construction funding was used to construct/
reconstruct over 33 miles of vital trail systems for pre/post 
Olympic use. These trails will also serve as vital 
infrastructure to our recreating public.
    Seed money to initiate a statewide collaborative effort to 
streamline and improve delivery of environmental education and 
visitor services and products.
    (2) Yes, the Forest Service is well within budget and 
timeframe with the Olympics. Our early involvement with the 
entire process and public involvement has assured us as a major 
player at the table of public service participants.
    (3) There are impacts and consequences for all priority 
shifts of emphasis within the Region, and the Agency, to 
accommodate new challenges and opportunities. The Region has 
set priorities that best balance the needs for the 2002 
Olympics with other current Forest Service program needs. The 
2002 Olympics are just one of the many funding challenges 
facing the Agency. However, the Region receives its fair share 
of the national funding total. The Region has dedicated one-
half of its facility funding on the highly visible facilities 
most likely to be impacted by the 2002 games. That leaves less 
funding than in prior years to address the facilities in the 
rest of the regions.estimated $818 million in recreation 
facility backlog.
    (4) The Olympic 2002 Planning effort continues to operate 
within the scope and philosophy of ``Option III'' of the 2/26/
96 ``Salt Lake Olympic Budget Strategy'' as submitted by 
request to Senator Bennett (R-Ut) and Representative Hansen (R-
Ut) last year.
    Subsequent to the 2/26/96 submittal of the budget strategy 
document, the planning team contracted for intensive research 
of costs/effects of past winter games, held de-briefings with 
Forest Service officials involved with the Atlanta Games, and 
conducted a project-by-project value analysis of the Strategy 
to validate and refine the costs for Option III. As a result of 
this effort, Option III costs are now different than the 
original 2/26/96 costs.
    The following chart compares the original Option III 
numbers with the Value Analysis-driven refinements of Option 
III, and the available fiscal year 1998 funding in the 
President's Budget:

                                                   OPTION III                                                   
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                     Feb. 26, 1996, option       Revised option III     Fiscal year 1998 funding
                                              III           ----------------------------------------------------
            Fiscal year            -------------------------                                                    
                                     NFRM     CNRF    CNTR     NFRM     CNRF     CNTR     NFRM     CNRF    CNTR 
----------------------------------------------------------------------------------------------------------------
1998..............................    $981   $1,183    $248   $1,276   $1,124     $400     $726   $1,124    $400
1999..............................     999    1,237     248    1,406    1,124      400      726    1,124     400
2000..............................   1,754    1,458     248    1,416    1,124      400      726    1,124     400
2001..............................   1,779    1,314     248    1,312    1,124      400      726    1,124     400
2002..............................   1,968    1,235     248    1,293      280  .......      726      280  ......
                                   -----------------------------------------------------------------------------
    Total.........................   7,481    6,427   1,240    6,703    4,776    1,600    3,630    4,776   1,600
                                   -----------------------------------------------------------------------------
    Grand total...................                                                                              
(2)15,148                                                                                                       
(2)13,079                                                                                                       
(1)       10,006                                                                                                
----------------------------------------------------------------------------------------------------------------

    Projected estimates for State and Private Forestry Programs 
to support the 2002 Olympics are $13,522 million over 4 years, 
of which, $10,405 million would be provided by non-government 
sources. This means that $3,117 million will have to come from 
S&PF funding.
    It is important to note that under current funding levels, 
efforts are underway to use those State and Private Forestry 
(S&PF) programs that have potential to provide support through 
community based and regional strategic planning efforts. These 
efforts provide increased capacity for local governments and 
organizations to fund high priority projects and initiatives 
through collaborative planning and partnership building.
    Question. Recently, the Committee gave the go-ahead for the 
consolidation of the Intermountain and Rocky Mountain Research 
stations in Ogden and Ft. Collins, CO. This action has caused 
considerable concern among many of my constituents regarding 
the impact on research within my state, the number of dollars 
allocated to the Intermountain region and the impact on 
employees in Ogden. While I was reluctant to allow this 
consolidation to go forward, I have received a commitment from 
the good Chairman of this Committee that we will revisit this 
issue in 1 year to determine if the anticipated savings have 
been realized. Has the consolidation occurred yet? Please 
provide to me an analysis of the estimated increased travel 
costs that will be associated with the consolidation. What 
assurances can you offer that the new station will continue to 
provide solid, on the ground research assistance to the 
constituents within the Intermountain region. Have any 
employees in the Intermountain station been reassigned or have 
had a change in responsibilities?
    Answer. There are four subquestions imbedded in question 
no. 175 by Senator Bennett.
    A. The merger of the Intermountain and Rocky Mountain 
Stations occurred on May 5, 1997. The new station is known as 
the Rocky Mountain Research Station.
    B. Travel costs and savings were not used in projections of 
savings from the consolidation due to: (1) intent to utilize 
new technologies including replacing some travel with audio and 
video conferencing; (2) the difficulties of making estimates; 
and (3) odd and changing transportation costs. For example, the 
one way government rate to fly between Salt Lake City and 
Missoula is $282, while the government cost to fly from Denver 
through Salt Lake City to Missoula is $283.
    Following is an effort to categorize the costs and savings.
    Travel Savings: One Director and one Assistant Director for 
Administration instead of two of each attending required 
regional and national meetings results in an estimated annual 
savings of $12,000.
    Travel Cost Increases: Trips between Ogden and Fort Collins 
by administrative personnel for supervision and coordination. 
Number of trips needed will be minimized by use of electronic 
and phone communications but some trips will be needed. The 
government air fare between Denver and Salt Lake City is 
currently $40.00. Travel costs during the transition from two 
stations to one will temporarily rise as employees are fully 
involved in implementing the consolidation. We expect the 
transition to be implemented within 1 year. Perhaps an extra 10 
to 15 trips during the transition year will result in an 
estimated cost increase of $2,000 during fiscal year 1997.
    Travel Cost Offsets: Travel by one Director and one 
Assistant Director for Administration to field locations 
offsets the travel made by the second Director and Assistant 
Director for Administration.
    Travel by three Assistant Directors for Research as 
compared to five Assistant Directors for Research. There should 
be a long-term cost reduction but not during the transition 
year.
    C. Current support for on-the-ground research assistance to 
Intermountain constituents will continue because the research 
program underway will continue. Also, research capability 
outside of Utah can now be applied to Utah needs. To initiate 
the additional support we envision after the merger, the 
Station Director, some of his staff, and several research 
project leaders met on April 24, 1997, with the Commissioner of 
Agriculture, the Director of the Utah Agricultural Experiment 
Station and the Head of the Utah State Forestry Department. The 
meeting objectives were to describe some key research 
activities and to initiate stronger communications and 
coordination among those the attendees. A second a meeting was 
held at Utah State University to discuss the consolidation and 
opportunities for increased collaboration between Station and 
University scientists. This meeting was open to all members of 
the University community. The Station Director provided 
information on how research priorities are identified within 
the Forest Service Research process and invited the various 
groups present to become involved. Seeking involvement of the 
Utah officials in research activities occurring outside of Utah 
but applicable in Utah has already begun also. These and future 
meetings serve to determine mutual interests and examine ways 
in which the various organizations can cooperate.
    D. No employees in the Intermountain Station have been 
reassigned or have had a change in responsibilities. Employees 
will be involved as the two stations develop common procedures 
for the new station. Through this full employee involvement, 
changes in responsibilities may occur.
    Question. Please provide me with the FS position on the 
proposed transfer of the Dutch John property in Daggett County, 
Utah. Is the FS supportive of a transfer of this property? What 
reservations does the FS have with this proposed land exchange?
    Answer. Our understanding is that the proposal now being 
considered would involve the transfer of jurisdiction of 
approximately 2,450 acres of National Forest System lands 
associated with the Dutch John community to the Secretary of 
Interior, acting through the Bureau of Reclamation. In return, 
the Secretary of Interior would transfer jurisdiction to lands 
of equal value containing approximately 2,167 acres to the 
Secretary of Agriculture, which would become part of the Ashley 
and Uinta National Forests.
    Certain lands, structures, and facilities needed for 
National Forest administration will be retained.
    Also under this proposal, the Bureau of Reclamation would 
ultimately convey the lands associated with Dutch John 
community to residents and to Daggett County. The Forest 
Service would not be involved in the details of how this 
transaction would occur and we would defer to the Department of 
Interior on these matters.
    As outlined above, the Forest Service does not have any 
reservations about the proposed transfer of National Forest 
System lands.
    Question. As you know, Congress recently passed the Great 
Western Trails bill, which I introduced in the Senate. It has 
been brought to my attention that approximately $300,000 is 
needed to conduct the necessary studies to make a 
recommendations if this Trail should be included as part of the 
National Trails System. Does the Forest Service intend to 
utilize funding from within the Region? If so, how will it 
impact other programs within the region? When will this study 
be complete?
    Answer. The Forest Service has not identified specific 
funding to do the study at this time. Without additional funds 
to the Agency, doing this study will be offset with other 
project work. The study is expected to take a minimum of 2 
years to complete.
                                ------                                


              Questions Submitted by Senator Thad Cochran

                            termite research

    Question. How much of the work conducted at the Starkville, 
Mississippi, termite control research unit is conducted on new 
products seeking EPA registration as a termiticide?
    Answer. In the fiscal year 1998 President's Budget, about 
forty-percent of the effort of the termite control research 
unit is on new products seeking EPA registration as 
termiticides and/or alternatives to termite control. Sixty-
percent of the effort is on basic biology, ecology, and 
behavior to fill the important knowledge gaps needed for more 
effective use of current and emerging technologies.
    Question. Are any of these activities funded through user 
fees paid by the registrant?
    Answer. Yes. Funds received through agreements from 
industry cooperators are used for supplies, materials, 
equipment, and associated travel. Salary and overhead expenses 
are covered by Forest Research appropriations.
    Question. Does EPA reimburse the Forest Service for any of 
the activities conducted at this unit which are not funded 
through user fees?
    Answer. No. EPA does not reimburse the Forest Service for 
any of the activities conducted at this unit that are not 
funded through user fees.
    Question. What level of funding is necessary to support 
this unit's on-going research, fund its activities associated 
with new termiticide approval, and fund new research on 
Formosan termite?
    Answer. The level of funding in the President's Budget 
($792,000) is adequate to support this unit's on-going 
research. In the spirit of public-private partnership, we plan 
to increase the user fee charges for new products seeking EPA 
registration in order to offset all our costs for testing. This 
will allow us to better meet industry's needs for unbiased 
testing of their products for EPA while at the same time 
allowing the Forest Service to focus appropriated research 
funds on the biology and ecology of termites and related 
insects. Ongoing research on Formosan termites costs about 
$15,000/year. Many of the research results on native 
subterranean termites can be applied directly to control of 
non-native Formosan termites. Additional avenues of funding are 
being explored for cooperative research with USDA-ARS on 
behavior of termites.

                             beaver control

    Question. What is the Forest Service's policy on beaver 
control on national forest system lands?
    Answer. On much of the National Forest System beavers are 
considered an asset. They create wetlands, provide habitat for 
waterfowl and many other wetland dependent species, and 
moderate flood events. Their populations are kept in check by 
demands for pelts or biological controls. It is in the south 
where most problems occur with beaver. Southern beaver pelts 
are not as valuable as their northern relatives. Also, the 
hydrology of many southern wetland systems has been altered to 
provide better farming conditions and flood protection, thus 
compounding the effects of beavers.
    The agency controls beaver to meet multiple use objectives 
for the National Forest. The general priorities for beaver 
control are protecting timber, roads, and infrastructure from 
damage. We cooperate with States and USDA Animal and Plant 
Health Inspection Service (APHIS) in their efforts to prevent 
flooding on adjacent private lands. On most Forests, where 
control efforts have remained consistent, beaver problems have 
been held to a minimum.
    Memorandums of Understanding between the States and the 
Forest Service generally recognize the States as the 
responsible agency for populations of resident wildlife, 
including beaver, with the Forest Service being responsible for 
habitat. The USDA APHIS--Animal Damage Control (ADC) has 
developed a successful partnership with the Forest Service and 
the States to control beaver populations.
    A Memorandum of Understanding (MOU) between the USDA Forest 
Service and the USDA APHIS--Animal Damage Control, identifies 
the responsibilities of the respective agencies and fosters a 
partnership in discharging the Federal obligation under the 
Animal Damage Control Act of March 2, 1931. This MOU clarifies 
APHIS's role in providing technical information on animal 
damage, management tools and techniques, conducting management 
programs, and complying with environmental regulations and laws 
when conducting predator control activities on National Forest 
System lands.
    Forest Service policy defines the roles of these two 
respective agencies as described in the above-mentioned MOU. 
Generally speaking, APHIS carries out animal damage management 
activities on National Forest System lands to minimize 
livestock losses from predation by coyotes, black bears and 
other predators. The Forest Service may conduct activities to 
control animal damage caused by small mammals and other animals 
to National Forest System resources, such as timber stands and 
roads. However, it is possible that APHIS may assume these 
activities. This activity can be determined through 
coordination between the Forest Supervisor, APHIS personnel, 
and responsible State agencies.
    Question. What is the Forest Service's policy on 
controlling pests, such as beavers, which affect landowners 
adjacent to a national forest?
    Answer. The States have the responsibility to manage 
beaver. They frequently work through APHIS to conduct animal 
control programs. It is the Forest Service policy to cooperate 
with those having legal responsibility to manage resident 
wildlife, as in this case the States, to do what we can to be 
good neighbors.
    Question. How much, and under what account, are funds 
included in the President's budget for beaver control on 
national forests, and specifically, how much is included for 
Mississippi?
    Answer. In fiscal year 1996 and fiscal year 1997, a 
successful partnership between the Delta National Forest (MS) 
and APHIS resulted in the trapping of beaver on the Forest and 
immediately adjacent to the Forest on private lands. Beaver 
impoundments were also breached to facilitate removal of 
standing water from private lands. The allocation within the 
USDA APHIS budget for fiscal year 1996 and fiscal year 1997 was 
$75,000 annually.
    No funding is included with the Forest Service budget 
specifically for beaver control. Any expenditures would be in 
coordination with resource work directly on National Forest 
System lands.
    Question. What funding level is necessary to control 
beavers on national forests in Mississippi?
    Answer. The estimated annual funding level for USDA APHIS 
to continue its partnership with the Delta National Forest, and 
to expand the program to other National Forests in Mississippi, 
is $100,000. This amount will allow the beaver population on 
the Delta National Forest to be held in check, and to expand 
the control program to other National Forests where the beavers 
may soon become problematic.
    Question. Does the Forest Service recognize a legal 
liability when its failure to control pests, such as beavers, 
causes damage to privately-owned land adjacent to a national 
forest? How are such damages paid?
    Answer. The Forest Service has no responsibility for 
controlling pest such as beaver.

                              timber sales

    The President's budget proposes that the timber sale level 
for the Southern region (region 8) be reduced from 835 million 
board feet in fiscal year 1997 to 675 million board feet in 
fiscal year 1998.
    Question. How much of this decrease is attributable to the 
following factors: (1) elimination of the purchaser credit 
program for road construction and reconstruction (2) decreases 
in Southern pine beetle infestation levels (3) programmatic 
changes?
    Answer. (1) Eliminating the purchaser road credit program 
did not affect the timber volume. (2) At the time the 
President's Budget was developed, the Region estimated there 
would be about a 7 million board feet reduction in salvage 
sales due to a reduction in souther pine beetle populations. 
(3) The majority of the reduction, 153 million board feet, is 
attributable to the region's need to rebuild the timber 
pipeline. The region has managed to keep their unit cost the 
lowest in the nation for the past several years. However, this 
came at a price in that they used their sales prepared for 
future years to keep the program level volume high and their 
cost low whenever there was a disruption to the program, such 
as salvage sale emergencies and western fire crew committments. 
This caused the region to deplete their timber sale pipeline. 
In fiscal year 1998 the region is only capable of producing 602 
MMBF without further sacrificing their pipeline at the proposed 
funding level.
    Question. If timber sale levels were not dictated in 
appropriations legislation, what level of sales would be 
necessary to adequately manage the national forest system 
nationally, and specifically, in Mississippi?
    Answer. Timber sale levels are determined by available 
appropriations, management priorities of the individual 
Forests, and the results of environmental analyses. Because 
forests change over time, and management needs change in 
response, there is no one answer to this question.
                                ------                                


             Questions Submitted by Senator Robert C. Byrd

                     west virginia forest resources

    Chief, early in may Senate career, I worked with the Forest 
Service to make sure information would be available to West 
Virginians to help with management decisions related to our 
forest resources--conservation, reforestation, stand 
improvement, and other investments to allow for wise 
development and use--both for consumptive and non-consumptive 
purposes.
    I recognized that increased employment opportunities would 
occur over time, as improved forest management contributed to 
more growth. Today, the forest products industry is the third 
leading manufacturing industry in my state, up from fifth 10 
years ago. West Virginia's forest stands have also improved--
growth now averages 6,500 board feet per acre, as compared to 
about 1,800 board feet per acre less than 40 years ago.
    The challenge is to help landowners manage the forest 
responsibly as well as to discover business opportunities that 
might contribute to job growth. The Forest Service can help in 
this regard, with technical assistance programs such as Rural 
Development Through Forestry and Wood in Transportation, 
coupled with hardwoods market analysis and economic research. 
Thus, I am interested in making sure the Forest Service budget 
maintains its emphasis in these areas. Compared to the funds 
necessary to manage the national forest system lands, these are 
relatively small investments that can leverage considerable 
contributions from other sources.
    Question. Chief, what do you see as the most critical role 
the Forest Service can play in helping West Virginians maximize 
the diverse benefits of our forest resources?
    Answer. The Forest Service provides leadership and 
expertise that supports sound management to sustain the State's 
forest resources through research, technology training and 
transfer, and financial assistance. Through State and Private 
Forestry, the knowledge of Forest Service experts works to 
ensure the efficient utilization and scientific management of 
West Virginia's forest resources.
    Question. How are the state and private forestry programs 
helping to improve our forest management as well as helping to 
develop alternative markets for lower value wood products?
    Answer. State and Private Forestry programs provide 
technical and financial assistance to communities, non-profit 
organizations, and businesses through collaborative efforts 
that address environmental, economic, and social concerns and 
opportunities. Efforts focus upon advancing manufacturing 
technologies, especially those associated with hardwoods; the 
use of wood in transportation; developing new markets 
domestically and internationally; analyzing resource 
availability for business expansion and recruitment; and 
implementing best management practices.
    Despite the types of positive improvements which have 
resulted from the rural development and wood in transportation 
programs, funding for both of these initiatives is proposed to 
be reduced in the fiscal year 1998 budget.
    Question. Do you believe these programs have fulfilled 
their objectives, or is there more that can be accomplished if 
the fiscal year 1997 funding levels are continued in both of 
these areas?
    Answer. While much more can be accomplished in both areas, 
when placed in perspective with other pressing needs for budget 
resources, these program areas are a lower priority than 
others.

               hardwoods technology center, princeton, wv

    Through my efforts, and with the support of the Forest 
Service, a hardwoods technology center has been established at 
Princeton, WV. The purpose of this center is to assist small, 
independent operators in their efforts to establish a market 
niche in the secondary hardwoods processing industry. The 
Center provides training and access to equipment on a time-
shared basis--critical elements when there are many 
opportunities but where capital requirements can be a hindrance 
to market entry for small businesses and entrepreneurs.
    During the last year, as a result of funds I had added to 
the fiscal year 1997 Interior bill, the Forest Service has been 
working cooperatively with the Hardwoods Center to help it 
achieve and sustain the goal of being self-sufficient in its 
operations.
    Question. Can you provide me with an update of the efforts 
taken by state and private forestry and research to strengthen 
the program at Princeton?
    Answer. State and Private Forestry assigned a liaison to 
work between the Center to better coordinate outreach 
activities; business planning; market development and 
expansion; and hardwood utilization. In addition, State and 
Private Forestry provided financial assistance to permit 
representatives of 20 State Forestry agencies and economic 
development specialists in each West Virginia county to review 
the Hardwoods Technology Center. This has encouraged 
understanding of how the Center can aid the economic 
development of their States and counties and develop new 
clients for the Center.
    Research has completed an evaluation of the Princeton 
research program. Two significant changes are currently being 
implemented that will strengthen the research program and more 
adequately address the industry's needs. First, part of the 
Forest Inventory and Analysis (FIA) program will be conducted 
at Princeton. This will help shorten the FIA cycle throughout 
the region and expand the number of analyses. Second emphasis 
will be placed on research that will help the land manager 
produce higher quality trees and logs in forests impacted by 
fire, insects, poor harvesting practices or other factors that 
have reduced the quality of forest trees.
    Both State and Private Forestry and Research joined the 
Center in signing a Memorandum of Understanding (MOU). This MOU 
provides a general framework to cooperatively implement an 
``institute concept'' to better provide the understanding 
needed for sound management and practical utilization of the 
Appalachian hardwood forest resource.
    Question. The Forest Service proposed the concept of a 
``hardwoods institute'', wherein the research capabilities at 
Princeton, the technical assistance and expertise of the State 
and Private Forestry program, and the Hardwoods Technology 
Center would be better coordinated and used. What progress has 
been made in developing this framework? What planning has been 
completed? Have specific project been determined?
    Answer. The fiscal year 1997 appropriation included funds 
to implement an ``institute'' concept between the Center, the 
Northeastern Area, and the Northeastern Forest Experiment 
Station to coordinate cooperative projects among the units and 
promote new business for the Center.
    Timesharing agreements with sawmills, furniture companies 
and allied business are in operation; these companies are using 
the Center facility to decide if investments in new technology 
are feasible for them.
    Question. What actions has the Forest Service taken to 
adjust the research mission at Princeton to ensure that 
information on the Appalachian hardwood resource with respect 
to growth/production and primary and secondary utilization is 
gathered? For example, can the lab assist in efforts to gather 
information about hardwood growth, pricing, grades of logs and 
lumber, and degradation due to fire and insects and disease? 
Wouldn't such information be useful to small hardwood 
businesses and to rural development and economic improvement in 
Appalachia?
    Answer. The research work units at the Princeton lab have 
historically worked to advance more efficient uses of forest 
resources, evaluate hardwood use patterns and processing 
trends, and have studied strategies that will improve the long-
term performance and competitiveness of the hardwood products 
industry. This information has been useful to small hardwoods 
businesses and to rural development and economic improvement in 
Appalachia. We have recently completed an evaluation of our 
research program at Princeton in an effort to meet the needs of 
residents in Appalachia and throughout the region. Decisions 
have been made that the staff in Princeton will become more 
involved in the Northeastern Station's inventory and evaluation 
of the health of forest resources and in providing information 
to land managers that will help improve tree and log quality. 
Research efforts will include studies on how to manage forests 
degraded by fires, insects, or poor harvesting practices in 
order to obtain the highest quality trees and logs possible. 
The research will also address how best to convert these trees 
and logs into products with the highest possible yields. This 
information will be very useful to small hardwood businesses 
and land owners in Appalachia.
    Question. Are there any conditions which preclude the 
Princeton research lab from entering into cooperative 
agreements with the Hardwoods Center for projects that would be 
mutually beneficial?
    Answer. Forest Service Research has several different 
authorities it can use to enter into cooperative relationships 
with interested parties. The relationships include cooperative 
research agreements, cooperative research and development 
agreements, patents and licensing agreements, and special use 
permits. Each type of relationship is for a specific purpose 
and relies upon a different legislative authority. After Forest 
Service Research and the interested party have preliminary 
discussions to outline the nature of the intended relationship, 
the agency selects the most appropriate legislative authority 
to create the desired relationship. For example, entering into 
a cooperative research agreement requires substantial 
involvement by the Forest Service in planning and conducting 
the research.
    Occasionally, the nature of the relationship desired is 
sufficiently different from the usual and customary cooperative 
relationship that we seek advice from legal counsel to assure 
that we are within the scope of the relevant legal authority.
    The Hardwoods Center has been working cooperatively with 
the Forest Service to obtain use of a facility that is no 
longer required by the Princeton lab. However, the Forest 
Service has to date been unable to provide a mechanism by which 
the Hardwoods Center could use this building.
    Question. Why has there been such a delay in resolving this 
issue? What hindrance precludes the Forest Service from using a 
cooperative agreement to allow the Hardwood Center to use this 
facility? If legislative language is necessary to allow such 
use to occur, please provide language as a drafting service.
    Answer. Recently, the Hardwood Training Center sought an 
agreement whereby it could use Northeastern Station's Materials 
Testing Building at Princeton for both training and commercial 
production. The Center's desire to use the facility for 
commercial purposes is an unusual request, which appears to be 
prohibited by legislative authorities covering cooperative 
research agreements. So we explored a licensing agreement and 
sought review by the USDA Office of the General Counsel. The 
OGC responded on April 14, 1997, that the proposed licensing 
agreement would be an unauthorized disposal of government 
property. Using our conventional cooperative research agreement 
authority was also addressed by OGC. They concluded that such 
an agreement might allow Forest Service Research and the 
Hardwood Center to work cooperatively through the State 
Forester in developing new technology. However, current law 
pertaining to cooperative research agreements would not allow 
the Hardwood Center to charge others to use the Forest Service 
facility. We have now shifted our attention to special use 
permit authorities and are discussing with OGC if a special use 
permit could be issued. Because alternative ways to resolve the 
issue are still being explored, draft legislative language has 
not been developed.
    The fiscal year 1998 budget continues funding for the 
Princeton lab at the same level provided in fiscal year 1997. 
The technical assistance funding, however, is proposed in the 
budget to be reduced from $200,000 to $150,000.
    Question. What is the basis for the proposed reduction? 
Does the Forest Service believe that the objectives at 
Princeton have been substantially accomplished?
    Answer. The Mission of the Center is to improve the quality 
and efficiency of secondary wood processing industries in West 
Virginia and throughout the hardwood processing community. The 
Center has trained industry personnel on state of the art wood 
processing equipment and provided small businesses with time 
sharing opportunities. Companies through this time sharing 
agreement continue to use the facility to determine if new 
technology is feasible and worth the investment. The Center 
continues to demonstrate its value to the hardwood industry and 
the residents of West Virginia.
    The reduced level of State and Private Forestry funding for 
the Center reflects the overall reduction in funding for all 
components of the Economic Action Programs.
    Chief, I am troubled that the Forest Service might be 
abandoning its commitment to this project prematurely. This is 
not a huge amount that we are talking about, and I hope the 
Forest Service will reconsider its position and sustain the 
current level of effort. I will be working with Senator Gorton 
to ensure that the efforts to ensure the success and self-
sufficiency of the Center are not undermined.

                      monongahela national forest

    Chief, you may not be aware of this, but prior to its 
destruction by fire in 1992, the Seneca Rocks Visitor Center 
was the busiest Forest Service visitor center in the Northeast/
Mid-Atlantic region. Because of the high visitation--about a 
quarter of a million visitors annually--I have aggressively 
supported the need for a replacement facility at Seneca Rocks. 
To that end, this Committee has appropriated $7.1 million over 
a 5-year period to allow reconstruction to proceed.
    Question. I understand that ground has finally been broken 
and reconstruction has begun. Can you provide me with an 
update--is everything on track with respect to the budget and 
when is the facility expected to be completed and ready for 
occupancy?
    Answer. Construction began April 7, 1997. The building is 
expected to be completed on July 1, 1998. No additional 
appropriated funds are required to complete the project. The 
Monongahela National Forest is working with the USDA Design 
Center on final exhibit plans, and is looking for opportunities 
for partnerships to complete the exhibits.
    Chief, the recreation that occurs on our national forests 
is one of the benefits that is most widely recognized by the 
American public. The Forest Service has recognized the 
importance of this program by proposing an increase of $5.1 
million for recreation operations in the fiscal year 1998 
budget. At the same time, however, the agency has proposed a 
considerble reduction--minus $26.5 million, or 55 percent, for 
the recreation facilities reconstruction and construction 
program.
    Question. Given that the Forest Service already has an 
enormous backlog of maintenance requirements for recreation 
facilities--some $818 million--won't the proposed budget just 
put the agency further behind in its efforts to provide quality 
recreation opportunities for the American Public?
    Answer. The delivery of recreation opportunities and 
experiences through the developed sites program within the 
national forests is a major source of education, information, 
comfort, and enjoyment for millions of Americans. These 
developed sites include toilets and bathhouses, camping sites, 
parking areas, visitor centers, picnic shelters, and water 
systems, to name just a few. The condition of these facilities 
and systems plays a significant role in determining the quality 
of the recreation opportunity that the visitor has on the 
national forest.

                         wood in transportation

    I understand that the National Park Service is proposing 
safety improvements along the George Washington Parkway. There 
have been some concerns expressed, however, about the 
aesthetics and how the views along the Parkway may change when 
concrete ``jersey barriers'' are installed. When the suggestion 
of using traffic barriers that had more wood components was 
proposed, however, I understand that such barriers have not 
been approved for the speeds that exist along some parts of the 
George Washington Parkway.
    Question. Aren't these types of alternative applications 
the very type of uses that the wood in transportation program 
seeks to promote?
    Answer. Yes. In addition to typical highway and pedestrian 
bridges, the Wood In Transportation Program promotes additional 
transportation structures using wood. The program emphasizes 
products such as guard rails for bridge structures, portable 
bridges, railroad structures, and retaining walls. Much of this 
effort is driven by need and demand. Once a focused need has 
been identified, research efforts begin. Research is followed 
by demonstration and commercialization of promising results.
    Question. What research or demonstration is the Forest 
Service involved with that seeks to promote the use of timber 
in roadway devices, such as barriers and median dividers?
    Answer. Forest Service research to date has focused on the 
development of crashworthy bridge railings. Several designs 
have been developed and are available for use. Research on 
crashworthy wood barriers and median dividers has not yet been 
initiated, although there is a growing need for work in this 
area.
    Question. Are there particular hindrances to more 
widespread use of wood in transportation applications?
    Answer. Yes. Some of the hindrances are as follows:
    Lack of knowledge on the part of many engineers and 
transportation officials concerning the suitability, 
capability, and longevity of wood structures.
    A need to develop new designs and technologies, as well as 
in-service performance verification, to further improve the 
efficiency of wood transportation structures.
    Lack of knowledge concerning applications that include 
local resources and new materials that incorporate 
underutilized species.
    Demonstration, technology transfer, and commercialization 
efforts on recently developed technology are hampered by the 
constrained budget level.
    The Forest Service is currently addressing the hindrances 
of Wood in Transportation (WIT) through: the combined efforts 
of the Forest Products Laboratory and the National Wood in 
Transportation Information Center, located in Morgantown, West 
Virginia; technology transfer efforts that include WIT 
information available over the Internet; and by distributing 
over 41,000 pieces of WIT information per year to communities, 
business leaders, and the highway and engineering community.
    Question. How would such work be affected by the proposed 
funding level for the wood in transportation program, which 
overall is decreased $200,000 below the fiscal year 1997 level?
    Answer. A great deal of knowledge has been gained through 
the program. To fully capture the benefits of this knowledge, 
the Forest Service is focusing on commercializing specific 
technologies that have the greatest potential to benefit the 
public.
    Question. What effect would the proposed fiscal year 1998 
funding level have on the activities of the Timber Bridge 
Information Resource Center in Morgantown?
    Answer. In fiscal year 1996, the National Wood in 
Transportation Information Center (Timber Bridge Information 
Resource Center) distributed approximately 41,000 pieces of 
information. This was an increase of more than 15 percent from 
fiscal year 1995. The demand for information provided by the 
Center continues to increase. The proposed reduction would 
require the Center to reduce its current level of activity, 
lessening information available to highway engineers, 
transportation officials, and community officials.

                             general budget

    The fiscal year 1998 request for the Forest Service is $2.4 
billion, which is relatively flat with the fiscal year 1997 
enacted level, when the emergency appropriations for fire and 
disasters are excluded. Within the budget, however, a 
considerable redirection is proposed--national forest system 
funding is proposed to increase by $50.1 million, while 
firefighting is reduced some $15.7 million and construction and 
reconstruction is decreased approximately $34 million.
    Question. What consequences would you foresee for the 
Forest Service if the Congress stayed relatively on par with 
the distributions between activities that was provided in 
fiscal year 1997 rather than concurring with your proposed 
reallocations for fiscal year 1998?
    Answer. The President's fiscal year 1998 budget request for 
the Forest Service has been carefully prioritized and balanced 
to focus on critical needs within a virtually flat budget level 
compared to fiscal year 1997. The proposed reallocation is in 
concert with key budget priorities aimed toward our strategic 
goals of ensuring healthy ecosystems and sustainable levels of 
products and services. Our judgement is that redistribution 
achieves higher priorities in meeting current demand than 
additional construction or land acquisition which would 
otherwise be desirable.
    Question. If the requested increases in the National Forest 
System account are not funded in fiscal year 1998, how will 
this affect management of the Forest Service's 191 million 
acres?
    Answer. Without the requested increases, we would have 
reduced capability to address our highest health and safety and 
resource concerns across the 191 million acre National Forest 
System. The proposed increases would allow us to accomplish 
more of this high priority work than we could working within 
our current constraints.
    For fiscal year 1998, the Forest Service has established 
Performance Indicators to measure accomplishments within each 
Expanded Budget Line Item (EBLI) within the National Forest 
System For detailed information about what the requested 
increases would allow us to accomplish over the fiscal year 
1997 level, refer to the Performance Indicator Tables within 
each (EBLI) discussion in the Forest Service fiscal year 1998 
Explanatory Notes.
    For example, taking samples from those Tables, the increase 
would allow us to make non-structural improvements in 10,000 
additional acres of rangeland; to make timber stand 
improvements (TSI) on an additional 55,400 acres; and restore 
or enhance an additional 109 miles of stream.
    Without the increases, we will continue to focus on our 
highest priorities with the funding we do receive.
    Question. Are there certain aspects of the requested 
increases that are necessary to comply with court orders or 
settlements? Please provide details.
    Answer. At this time the increases requested are not 
intended to be used to make payments necessary to comply with 
court orders or settlements. Funding for potential payments 
resulting from claims and settlements for environmental reasons 
is currently under review withinthe Administration. Claims and 
settlements involving existing timber sales in habitat for 
marbled murrelet, Mexican spotted owl and salmon, for example, 
are not included in this request.

                              firefighting

    The droughts and pest infestations of recent years have 
contributed to extensive fire conditions. Despite annual 
appropriations of approximately $500 million annually in recent 
years, Congress has had to provide emergency appropriations for 
firefighting because of extraordinary expense. In fiscal year 
1995, an emergency appropriation of $450 million was provided, 
and in the Fy 1997 Omnibus bill, and additional emergency 
appropriation of $550 million was provided.
    Despite these extraordinary measures, the Forest Service 
has had to exercise emergency transfer authority to address the 
immediate needs for fire suppression during the summer season. 
As a result, $443 million remains to be repaid to the Knutsen-
Vandenburg (K-V) Reforestation account from which it was 
transferred.
    Question. Of the $550 million appropriated last fall, how 
much has been released by the President and made available to 
the Forest Service? What are the Forest Service's expectations 
with respect to release of the remaining funds?
    Answer. In the fiscal year 1997 appropriations Congress 
established an emergency contingency fund in the amount of $550 
million for the purpose of covering additional fire-fighting 
needs with the proviso that these funds are also available for 
repayment for prior advances made from the KV fund for the same 
purpose. $202 million of this $550 million has been released to 
repay K-V. In addition, $98 million has been used to cover 
fiscal year 1996 suppression costs. This leaves $250 million 
remaining in the contingency.
    If suppression costs exceed available funding in fiscal 
year 1997, a request could be made to release some or all of 
the remaining emergency contingency fund.
    Question. Even if the full amount yet to be released were 
provided to repay K-V, would monies still be owed to the 
reforestation trust fund?
    Answer. Even if the full $250 million was released and 
provided to repay K-V, an additional $193 million would still 
be owed the K-V fund for prior year advances for emergency 
firefighting.
    Question. Does the Administration have a plan for repaying 
K-V, or do you anticipate carrying this burden over from 1 year 
to the next for the foreseeable future?
    Answer. The Administration is committed to providing the 
resources necessary for firefighting and for carrying out the 
KV program of work scheduled for 1998. The adequacy of 
unobligated balances in the KV fund to achieve these goals is 
continually monitored.
    As part of its fiscal year 1998 Budget, the Administration 
has proposed a $5.8 billion contingency account for 
unanticipated needs/disasters. Among the proposed uses of this 
account would be Forest Service firefighting.
    Question. If this account is not agreed to in the normal 
appropriations cycle, what impact would this have on the Forest 
Service firefighting program?
    Answer. This contingency fund was intended to be available 
to cover any additional fire suppression costs above the 
appropriated amount in fiscal year 1998. However, a budget 
amendment has recently been submitted to the Congress 
withdrawing the request for this fund. As a part of the 
President's Budget, there is however, a provision which allows 
the Forest Service to utilize other available funds in the 
event fire fighting costs exceed the appropriated level.
    Question. Since your fiscal year 1998 budget is far below 
the 10 year average for firefighting, if the contingency is not 
approved, would you anticipate further borrowing from KV?
    Answer. If firefighting needs exceed appropriated levels 
and the contingency is not approved the Forest Service will, 
first ask to allocate the $250 million contingency fund. If 
those funds are not sufficient, we will have to borrow money 
from the KV fund or other Forest Service programs to cover 
expected fire-fighting costs.

         senior citizen employment--monogahela national forest

    The Monongahela National Forest is able to partake in the 
Department of Labor's Senior Community Service Employment 
Program (SCSEP). The Monogahela, like many other forests, 
receives funding which is used in turn to provide a supplement 
to retired persons who assist in many visitor functions for the 
agency--staffing of visitor centers, campground hosts, 
providing information at ranger stations, and other such 
activities.
    Last year, there was some discussion that the Forest 
Service should be dropped from the SCSEP program as its dollar 
decreased.
    Question. What would be the effect on the Forest Service's 
ability to provide visitor services to the recreating public if 
the Department of Labor drops the Forest Service from the 
program?
    Answer. If the FS could no longer continue as a National 
Sponsor of the Senior Community Service Employment Program 
(SCSEP), it would have a severe impact on services provided to 
the recreating public. The SCSEP enrollees play a key role in 
hosting over 800 million visitors to the National Forests 
annually. It would mean a loss of over $20 million in work 
accomplished that benefits the recreation program. Some 
campground, building and trails maintenance work would not be 
accomplished. Visitor information services could be terminated 
or hours of service reduced. It could result in early closing 
of some recreation facilities and a reduced level of services 
during the popular recreating season.
    Question. What would be the additional costs to the Forest 
Service if the activities conducted by these senior enrollees 
would have to be funded out of Forest Service dollars? Would 
you reallocate funds in order to maintain the program, or would 
facilities such as campgrounds and visitor centers be closed 
due to staffing shortfalls?
    Answer. The additional costs to the FS would be equivalent 
to about $41 million of appropriated funds, if we lost 
Department of Labor funding for SCSEP. Since the value of work 
accomplished by SCSEP enrollees accounts for approximately $20 
million in benefits to the recreation program, this loss of 
funding might result in possible closures of some facilities 
such as day use areas and visitor centers. The loss of funds 
could also affect the level and quality of services provided to 
the public.
    The agency will probably not be able to reallocate funding 
to continue activities currently provided by the SCSEP.

                    forest service research program

    Chief, you are aware of my specific interest in the 
research activities conducted at the three locations in West 
Virginia. But I would also like to review with you in a more 
general way that challenges which face the research program at 
a time when dollars continue to be constrained.
    Question. What is the impact on the research program when 
increased funding is not provided to cover fixed cost 
increases, such as mandated pay and benefits, space, 
unemployment benefits and other uncontrollable costs?
    Answer. The increased costs of doing our research business, 
coupled with fixed or reduced funding, has reduced our research 
capability. The research dollars available for operating 
budgets decline when fixed costs increase and appropriations 
are constant.
    We have, and are continuing where possible, to reduce our 
administrative overhead. Also, there are many cases we are not 
filling vacant positions in order to use the funding to 
maintain the scientists we retain. Reduced operating budgets 
and fewer scientists equate to a smaller Forest Service 
Research program, as well as a reduced program for extramural 
cooperative research with universities and other partners.
    Additionally, fixed/reduced budgets have delayed facility 
maintenance and limited equipment purchases which are essential 
to stay at the cutting edge of science. In the long-term, 
fixed/reduced budgets impairs our ability to perform high 
quality research and respond to the natural resource research 
needs required by the Nation.
    Question. As the Forest Service budget has been reduced in 
recent years, what has been the impact on the number of 
scientists that are supported by the research budget?
    Answer. We have been forced to reduce the number of 
scientists. In fiscal year 1996 we had 548, down 23 percent 
from the 715 scientists we had in fiscal year 1990. The 
remaining scientists are dealing with the same problems as 
other employees who have been through downsizing due to budget 
reductions.
    Question. Has the Forest Service conducted any 
consolidations within the research program that have resulted 
in closures of locations?
    Answer. Due to budget reductions in fiscal year 1996 we had 
seven location closures: Fairbanks, AK; Bend, OR; Carbondale, 
IL; Orono, ME; Macon, Ga; Gulfport, MS; and Gainsville, FL
    Question. Has the research program gotten to a point that 
further budget reductions would result in more facility 
closures in order to maintain a core capacity in the remaining 
areas where research is conducted?
    Answer. Yes. We anticipate that every $1 million dollar 
reduction or redirection impacts 19 people. If the magnitude of 
the reduction or redirection was very severe we would certainly 
need to RIF employees and close locations.
                                ------                                


              Questions Submitted by Senator Byron Dorgan

    Question. The FS has over 230 million acres of land to 
supervise and manage. One of the mandates of current law, as 
interpreted by the courts and the agency itself, is the 
practice of developing National Environmental Policy Act 
documentation for every permit issuance, renewal and transfer. 
While in many instances this is a proper and efficient use of 
FS resources due to the substantial change in the use of some 
environmental degradation of the land, this is simply a waste 
of time and resources in a substantial number of permit 
renewals and transfers. What proposal is the FS developing, 
either administratively or in the form of recommended 
legislative changes, to help alleviate this burden?
    Answer. The Forest Service is working on several fronts to 
address the issues raised in this question.
    First, the agency is working on a proposal to expand our 
application of the categorical exclusion provisions of the 
regulations that have been promulgated pursuant to the National 
Environmental Policy Act (NEPA). Specifically, types of uses 
which qualify as being categorically excluded (from 
documentation in an environmental analysis or environmental 
impact statement) will be better defined, and will include the 
approval, modification, or continuation of a variety of minor 
uses, of small additions to larger existing uses, and for 
granting authorizations to applicants who have an existing 
right to use and occupy National Forest System lands. We intend 
to prepare a revised set of categorical exclusions for public 
notice, comment, and response later this calender year.
    Second, we are working at streamlining our application 
procedures through revisions to the regulations at 36 CFR 251, 
Subpart B. Specifically, we intend to establish a procedure 
whereby proposals for new uses must meet a series of pre-
application criteria before they will be accepted by the agency 
and processed as an application. This procedure will allow the 
Forest Service to more readily reject unacceptable proposals, 
and to more efficiently process accepted applications.
    Last, the agency has been steadily increasing its issuance 
of authorizations having a longer tenure then in the past. 
Doing so will reduce the number of applications which are now 
regularly expiring (generally, at 5 or 10 year intervals), and 
which require reconsideration and possible NEPA evaluation when 
they do. For example, we recently started issuing 
communications use leases at most of our communications site 
with tenures of 20 or 30 years, rather than a traditional 10-
year permit. We are also issuing long-term easements, some for 
as long as the easement is needed for the purpose which it was 
issued, others for periods of 30-50 years. Over time, this will 
significantly reduce the number of authorizations that will be 
expiring annually, and which need to be evaluated in the 
reissuance process. None of the above require legislation.
    Question. Currently, the Forest Service is engaged in 
creating a revised Forest Plan which includes the grasslands in 
North Dakota. I have received continued reassurances from the 
Forest Service that the ranchers and environmentalists from my 
state would be consulted as the plan is developed. However, up 
to this point the grazing associations, whose involvement with 
the land is so critical to the long term health and 
sustainability of the land, have not been involved.
    What is the Forest Service's plan to integrate interested 
parties into the planning process in an ongoing, meaningful and 
productive way?
    Answer. The Plan revision process for the Northern Great 
Plains encompasses three national forests and multiple national 
grasslands within Wyoming, Nebraska, and both North and South 
Dakota. The stewardship goal of the effort involves extensive 
collaboration with people and communities across the four 
States. To date, the planning team has reported multiple 
involvements with grazing associations through presentations, 
visits, and other communications by District Rangers, Forest 
staff, and the planning team. The engagement of people in this 
process is ongoing and open. As a special event, the week of 
June 9-13, the North Dakota National Grasslands will be hosting 
a series of public open houses across the State. Grazing 
associations not involved to date may contact the Planning Team 
to discuss further opportunities for meaningful and productive 
participation.
    Question. For many years, there has been substantial 
concern among permit holders on the National Grasslands in my 
state, and in many National Forests across the country, about 
the growing problem of noxious, and non-native weeds. In North 
Dakota, we have had a considerable problem with Leafy Spurge, 
costing ranchers a great deal in lost revenue. What is the 
Forest Service currently doing to help deal with this problem 
and other noxious weed problems, and what are your plans for 
the future to coordinate the protection of federal lands from 
this continuing problem?
    Answer. Aside from efforts to eradicate leafy spurge, the 
Northern Region of the Forest Service (FS) is working with the 
State of North Dakota Weed Coordinator to implement a weed-
seed-free forage program in North Dakota. This program would 
prohibit the sale and distribution of forage products within 
North Dakota unless they were certified as weed-seed-free. The 
restriction would apply equally to imported forage and forage 
produced within North Dakota. In support of this effort the 
Custer National Forest will prohibit the use of forage not 
certified as weed-seed-free on National Grasslands in North 
Dakota once the program is fully implemented. North Dakota has 
established inspection and certification procedures for 
producers; however, few local forage producers have come 
forward to sign up for the program. The FS is cooperating with 
the State to educate publics and outreach to forest users and 
forage producers about the need for the program.
    Last year, the FS implemented a national noxious weed 
strategy which outlines the Agency's goals and actions for 
prevention and management of noxious weeds across the National 
Forests and Grasslands. Priority has been given to prevention 
and rapid response to new infestations. The primary prevention 
action is to expand the weed-seed-free forage program to 
include all National Forest System (NFS) lands. The requirement 
that all visitors and permittees on NFS lands use weed-seed-
free forage is only instituted after working with the State to 
develop a weed-seed-free forage certification program. This 
program is run by the State with voluntary participation by 
forage producers. Forest closures are in effect in Montana, 
Idaho, Utah, Nebraska, Wyoming and Colorado.
    The FS is involved in other cooperative efforts with State 
and private partners at the national level. The Agency is a 
member of the Federal Interagency Committee for Management of 
Noxious and Exotic Weeds (FICMNEW), which has worked with State 
and private partners to develop Pulling Together: A National 
Strategy for Invasive Plant Management. The National Strategy 
was announced at a Congressional briefing April 29, 1997, with 
over 100 organizational supporters. The National Strategy is a 
unifying conceptual document in which the supporters have 
agreed to prevent,control and restore affected areas,using 
education,research and partnerships to achieve the goals.
    The new Pulling Together Partnerships initiative is the 
first step in implementing the National Strategy and the first 
round of 24 winning proposals have been selected. The program 
was jointly set up by USDA, USDI and the National Fish and 
Wildlife Foundation (NFWF), as a cost-share challenge grant 
program to use pooled Federal funds with matching local funds 
for multijurisdictional noxious weed management. The net result 
of this new program will be the leveraged use of funds; local 
decision-making based on community priorities; and the shared 
knowledge and experience among partners.
                                ------                                


            Questions Submitted by Senator Patrick J. Leahy

    Question. With timber harvest on public lands declining, 
the pressure on private forest lands to provide more of the 
nation's wood supply is increasing not only in the Northern 
Forest but across the country. Would you agree that more 
attention within the Forest Service should be focused on State 
and Private Forestry Programs? What can we expect not only in 
new funding, but also in expanded programs? Over the past 10 
years, how has funding for State and Private Forestry changed 
as a percentage of the overall Forest Service budget? How has 
it changed if you do not include the federal lands forest 
health management programs?
    Answer. The stewardship of the nation's nonindustrial 
private forest lands and the well-being of urban and natural 
resource dependent rural communities is a high priority for the 
Administration. Considering the many program priorities facing 
the Forest Service in fiscal year 1998, the President's budget 
proposal is formulated to balance different areas of necessary 
work, and is based on the priority of the State and Private 
Forestry programs among all discretionary programs. The 
President's budget for State and Private Forestry provides 
increased funding, compared to fiscal year 1997, for the 
following programs within the Forest Health Management Budget 
Line Item (BLI): Federal Lands Forest Health Management and 
Cooperative Lands Forest Health Management. Increases in these 
programs will allow resources to be focused on the protection 
of the health of the nation's forests through increased forest 
health monitoring and pest prevention and suppression. There 
will be increased technical assistance to federal land 
managers, Tribal governments, and State and private land 
managers in planning and implementing on-the-ground forest 
health management projects designed to improve the health of 
the Nation's forests. Forest Health monitoring will provide 
full coverage of 60 percent of forestlands in the contiguous 
United States, compared to a projection of 53 percent in fiscal 
year 1997.
    The President's budget also includes increases in the 
Cooperative Forestry BLI for the Stewardship Incentives Program 
and the Forest Legacy programs. These programs emphasize forest 
stewardship through landowner assistance programs to enable the 
9.9 million nonindustrial private forest landowners to better 
manage, protect and use their natural resources through forest 
stewardship programs. The increase in funding for the 
Stewardship Incentives Program will allow the Forest Service to 
fulfill part of the large demand for cost-sharing assistance to 
implement multi-resource practices on nonindustrial private 
forest lands. The increase in Forest Legacy nearly doubles the 
level of funding available to conserve environmentally 
important forests threatened by fragmentation and development.
    In the fiscal year 1998 President's budget, the S&PF budget 
share represents 6.6 percent of the total Forest Service 
discretionary funds. From 1987-1990 the S&PF budget averaged 
4.25 percent of the Forest Service budget and from 1991-1997 
the S&PF budget averaged 7 percent of the total Forest Service 
budget. The S&PF budget from 1960-1997 represents an average of 
6 percent of the total Forest Service budget. In fiscal year 
1997 the S&PF share of the Forest Service budget, without the 
Federal Health Management dollars was 5 percent.
    Question. At the proposed level, what level of funding will 
the Rural Development Through Forestry Initiative receive?
    Answer. Currently, the President's budget includes $9.0 
million for the Economic Action Programs. Of this amount $6.0 
million will be provided to the Northeastern Area to continue 
their Rural Development through Forestry Initiative.
    Question. What was the allocation of the fiscal year 1997 
funding per State?
    Answer. In fiscal year 1997 the Northeastern Area was 
allocated $3.01 million to continue the Rural Development 
through Forestry (RDTF) Initiative. Of this amount about $2.47 
million is allocated for use by the 20 states in the Northeast 
and Midwest. Of the $2.47 million, $2.058 million is already 
allocated to states for specific projects. Table 1 displays 
this allocation. The remaining $408,000 is to be allocated to 
multi-state projects in June of 1997.

                              TABLE 1.--RDTF ALLOCATION TO STATES, FISCAL YEAR 1997                             
----------------------------------------------------------------------------------------------------------------
                                                                                    State level                 
                              State                                  Technical        special       State total 
                                                                    assistance       projects                   
----------------------------------------------------------------------------------------------------------------
Connecticut.....................................................         $20,000         $15,000         $35,000
Delaware........................................................          20,000          15,000          35,000
Illinois........................................................          20,000          50,000          70,000
Indiana.........................................................          20,000          50,000          70,000
Iowa............................................................          20,000         280,000         300,000
Maine...........................................................          20,000          96,000         116,000
Maryland........................................................          20,000          30,000          50,000
Massachusetts...................................................          20,000          30,000          50,000
Michigan........................................................          20,000          88,000         108,000
Missouri........................................................          20,000          70,000          90,000
Minnesota.......................................................          20,000          72,000          92,000
New Hampshire...................................................          20,000          50,000          70,000
New Jersey......................................................          20,000          20,000          40,000
New York........................................................          20,000          80,000         100,000
Ohio............................................................          20,000          40,000          60,000
Pennsylvania....................................................          20,000         250,000         270,000
Rhode Island....................................................          20,000          15,000          35,000
Vermont.........................................................          20,000         100,000         120,000
Wisconsin.......................................................          20,000          77,000          97,000
West Virginia...................................................          20,000         230,000         250,000
                                                                 -----------------------------------------------
      Total.....................................................         400,000       1,658,000       2,058,000
----------------------------------------------------------------------------------------------------------------

    Question. How many Forest Legacy parcels are currently 
being negotiated; how much federal funding would be necessary 
to complete these projects; how many acres are involved; and 
where are they located?
    Answer. There are 41 parcels in various stages of 
negotiation which are not funded with fiscal year 1997 or prior 
federal funds. A summary by State shows the acres and the 
estimated federal funds needed:

                                  FOREST LEGACY PROJECTS (NOT CURRENTLY FUNDED)                                 
----------------------------------------------------------------------------------------------------------------
                                                                                                     Estimate   
                              State                                  Number of         Acres      Federal  funds
                                                                      parcels                         needed    
----------------------------------------------------------------------------------------------------------------
Connecticut.....................................................               3             367        $380,000
Massachusetts...................................................              10           1,148       1,734,000
Maryland........................................................               7           1,358       3,430,000
Maine...........................................................               3          20,381       3,000,000
New Hampshire...................................................               4          14,369       5,450,000
New Jersey......................................................               1             145         412,000
New York........................................................               5           2,048         768,000
Rhode Island....................................................               4             555       1,098,000
Vermont.........................................................               1           6,000       1,500,000
Washington......................................................               3             460       2,050,000
                                                                 -----------------------------------------------
      Total.....................................................              41          46,832      19,822,000
----------------------------------------------------------------------------------------------------------------

    In addition, other projects are currently under way using 
fiscal year 1997 and prior year funds. It is also anticipated 
that Utah, which recently joined the program, will be 
identifying parcels for acquisition in the near future.
    Question. In 1996 and 1997, how many fires started or 
crossed into the urban-wildland interface? How was funding from 
the Cooperative Lands Fire Management program used to fight 
these fires?
    Answer. Our current fire statistical data base does not 
specifically identify wildland-urban fires unless there was 
structural loss. In 1996, interface fires burned a total of 774 
structures. The 1997 statistics are not yet available.
    Cooperative Lands Fire Management funds leverage state and 
local fire agency funds to increase and insure compatability in 
training, organization, and equipment. Increased state and 
local capability, in cooperation with all other wildland 
firefighting agencies, increase the nation's ability to take 
fast effective initial attack on all fires, including those in 
the wildland urban area.
    Question. What is the status of the Timber Bridge 
Initiative? How many demonstration timber bridges have been 
constructed? What are the estimates for rural development 
impacts of this program?
    Answer. To date, 279 demonstration projects have been 
completed. Rural development improvements are seen by improved 
access to rural areas and increased employment. For example, in 
Kenai Borough, Alaska, a demonstration project assisted in the 
development of an innovative preservative treatment facility 
for local timber species. The facility, which created six jobs 
in a Native American village of 143 people, treats timber 
products that will be used for transportation structures. The 
Federal share of this project was $50,000, while cooperators 
provided $465,000.
    Question. Last year, the Forest Service pooled 
approximately $8.9 million from various accounts to support 
AmeriCorps program if Congressional approval was granted. How 
much of that funding remains? What has that funding been used 
for and does the Forest Service have plans to use some of the 
funds to support youth conservation corps programs?
    Answer. In accordance with congressional direction the 
Forest Service did not operate an AmeriCorps program in fiscal 
year 1997. The AmeriCorps funds have been redirected primarily 
back to the respective program areas and allocated as follows:

                                                                  Amount
Recreation funds for recreation fee demo pilot project..      $4,684,000
Fish and Wildlife funds for collaboration with the 
    National Fish & Wildlife Foundation and the National 
    Forest Foundation...................................       2,078,000
Timber/Road Reconstruction funds for timber replacement 
    volume in the Pacific Northwest as agreed to in 
    Court settlement....................................       1,424,000
Soil/Water funds for soil/water restoration, 
    stabilization, and monitoring in Southern California 
    due to impacts of illegal immigrants................         135,000
Soil/Water funds for determination of source pollution 
    of water in the Upper Animas Watershed in southern 
    Colorado............................................         100,000
Reprogramming of additional Grazing, Soil/Water, Land 
    Line, and Road Maintenance funds to fund replacement 
    timber volume in the Pacific Northwest..............         330,000
Permanent and trust funds remain in field units.........         149,000

    Question. Has the Forest Service estimated the savings to 
be gained from the timber purchaser credits road program 
initiative?
    Answer. There will not be any direct savings to the agency.
    Question. In 1995 and 1996, how much funding has been used 
for trail construction within the national forests from ISTEA 
enhancement program funds?
    Answer. The Forest Service does not maintain a national 
list of trails work completed through the ISTEA Enhancement or 
National Recreation Trails Fund (NRTF) programs. National 
figures can be obtained from the Federal Highway Administration 
which is the agency which maintains the programs. Responses 
from Regional Offices show an estimate of $200,000 per Region 
from NRTF on NFS lands.
    Question. Has State and Private Forestry considered 
establishing a training center for federal, state, and private 
foresters on conservation stewardship practices? Is there 
currently a similar training program within the Forest Service 
or operated by a non-profit foundation of a private enterprise?
    Answer. State and Private Forestry, working closely with 
the Cooperative States Research, Education and Extension 
Service, State Foresters, and other public and private 
partners, engages regularly in training state service foresters 
and consulting foresters in forestry and related conservation 
stewardship practices. In addition, we and NRCS operate a 
National Agroforestry Center in Lincoln, NE that provides 
training to field foresters on agroforestry conservation 
practices such as establishing and protecting riparian areas, 
windbreaks, and field shelterbelts. The Society of American 
Foresters and the Association of Consulting Foresters also 
engage regularly in continuing education in forestry and 
conservation stewardship practices for their members.
    Question. Within the NFS, which national forests have the 
greatest backlog of willing sellers of forest inholdings? Which 
forests have the largest number of acres left to acquire within 
their authorized boundaries? Which forests have the largest 
number of acres remaining within their acquisition targets? 
What is the existing backlog at the Green Mountain NF and how 
much funding is necessary to eliminate the backlog?
    Answer. Most NFs do not keep a record of the willing 
sellers of private land inholdings. These records would be 
difficult to keep current and would serve little purpose 
considering the limited level of land acquisition funding.
    There are over 40 million acres of non-NFS land 
(inholdings) within our boundaries. Several forests contain 
over one million acres of inholdings. The Chugach and Mark 
Twain NFs, each with over 1.5 million acres of inholdings, have 
the largest number of acres of inholdings. The Green Mountain 
NF has approximately 450,000 acres of inholdings. It is not our 
goal to acquire all inholdings. Land acquisition targets are 
not based on the acreage of inholdings. Targets are set each 
year after funds are appropriated.
    Another consideration is the percentage of inholdings 
within the forest boundary. As a general rule, the forests in 
our eastern regions have the highest percentage of inholdings. 
The Wayne NF has the highest percentage of inholdings with the 
percentage exceeding 70 percent. On the Green Mountain NF, over 
50 percent of the land within the boundary consists of 
inholdings.
    The existing backlog of land available for acquisition on 
the Green Mountain NF is valued at near $25,000,000,comprised 
of approximately 100 cases and 48,000 acres. Included in this 
total is the entire 18,000 acre New England Power Company tract 
with an estimated value of $10,000,000. To complete these 
acquisitions, we would need an additional 10 percent of the 
land value to pay for associated costs.
    Question. If a large parcel of land within a NF goes on the 
market unexpectantly, what authority or funding sources, other 
than Land and Water Conservation Fund, are available to acquire 
significant land under emergency circumstances?
    Answer. There is no other authority or funding sources to 
acquire lands.
    Question. How many national forests, and in which regions, 
will initiate their forest plan revision in the next 2 years?
    Answer. A total of 81 national forests will initiate land 
and resource management plan revisions in the next 2 years. 
This includes: 13 in R-1; 7 in R-2; 10 in R-3; 13 in R-4; 7 in 
R-5; 1 in R-6; 13 in R-8; 16 in R-9; and 1 in R-10.
    Question. Do all the forests face similar challenges and 
outreach strategies for revising their plans?
    Answer. Land and resource management plan revisions have 
the same requirements as the development and approval of the 
initial plans, including appropriate public participation 
activities and coordination with other public planning efforts. 
Individual national forests may address any number of public 
issues and management concerns in the revision effort, 
depending on the unique situation for that national forest. 
While some plan revision efforts may address similar issues or 
concerns, the level of intensity or controversy involved with 
these may be different.
    Question. What are some of the major differences?
    Answer. One example of a similar issue that all revision 
efforts will be addressing, but for which different levels of 
intensity or controversy may exist is in the evaluation of 
roadless areas. National forests with a great number of 
inventoried roadless areas may face a more complex analysis 
than those with very few roadless areas. Grazing may be a very 
important issue to address for national forests in the west, 
but not an issue at all for some eastern national forests. The 
same may be said for other potential issues such as the 
allowable sale quantity, critical habitat for threatened and 
endangered species, insect and disease outbreaks that pose a 
forest health issue, weather related resource condition 
problems associated with hurricanes or major landslides caused 
by excessive snowmelt or other precipitation events, the demand 
and supply potential for providing an integrated mix of goods 
and services, etc. Each land and resource management plan 
revision effort will be unique.
    Question. What are the estimated budget needs to revise 
these plans?
    Answer. Based upon the experiences of recently completed 
land and resource management plan revision efforts, estimated 
costs for these revisions are $500,000 per year for four years, 
or an average total cost of $2,000,000 per plan revision.
    Question. The forest inventory program is targeted to 
survey different regions of the country on a 10-year cycle. 
This cycle was designed to provide the various regions of the 
country with essential information on growth, harvest and 
condition of our forest resources. What factors have delayed 
the Forest Service in meeting this target in different Regions? 
What is the status of the forest inventory in the Northeast? Is 
the Forest Service required to use federal employees to do the 
data collection for these surveys? Has the Forest Service used 
contractors to do data collection in any region? If so, what 
kind of arrangement was made and was there associated cost 
savings? Would the Forest Service need additional authority to 
contract with state or private foresters to conduct the forest 
inventory?
    Answer. Factors causing delay:
    The current national Forest Inventory Analysis (FIA) 
inventory cycle is now 12+ years. The cycle is controlled by 
three main factors; (1) a mandated accuracy requirement which 
determines the amount of data to be collected, (2) funding for 
personnel and equipment which determines the speed at which the 
data are collected, (3) funding for technology research and 
application which can increase efficiency and reduce the 
collection burden on personnel and equipment without 
sacrificing accuracy.
    The first controlling factor, accuracy, is required and 
necessary to provide quality information to make sound 
management decisions. The second controlling factor, funding, 
is the central issue. Since 1995, overall Forest Service 
Research program funding has declined 10 percent. During this 
same time period, FIA field program funding has increased by 3 
percent. Clearly FIA is still a priority research program 
within the Agency but the modest increase in FIA funds have not 
been sufficient to offset the increased cost of getting 
personnel and equipment into the field. Continued funding at 
current levels will further erode the cycle unless new 
technology can bridge the gap.
    The third controlling factor, technology research, is 
difficult to maintain when cycles slip and demand for current 
information rises. However, scientifically sound research is 
critical to the application of any new technology or data 
collection method. With constrained budgets, FIA strives to 
maintain a balance between the potential gains in efficiency 
from development and application of new technology and the 
demand for shorter current cycles.
    Why did we fail to shorten the cycle? In the face of deep 
cuts in the Forest Service research budget the Agency did 
maintain FIA as a high priority (no overall reduction) but was 
unable to downgrade other critical research priorities to 
provide significant additional funding.

                            northeast status

    The FIA cycle in the Northeast is currently about 13 years.
Contractors/Non-Federal employees
    The FIA program has traditionally relied upon considerable 
direct and in-kind support from cooperators as we conduct 
Statewide inventories. In 1996, 13 percent of the FIA program 
came from State, private, and other federal cooperators. While 
we do not believe additional authorities would be needed to 
contract outside personnel, we do have concerns about quality 
assurance. Under any contractual arrangement, the FIA program 
must have complete control of the quality assurance process to 
insure that sampling design specifications and quality 
standards are met and are consistent across all ownerships and 
State lines. Additionally, FIA costs include training, data 
compilation, editing, processing, analysis, and reporting. 
These costs would be retained by FIA whether contractors were 
used or not. Our limited experience where contractors have been 
used indicate little difference between our cost for data 
collection only and contractor cost for data collection 
(including contract administration costs). We continue to be 
open to discussion on this issue and new annualized inventory 
designs like Annual Forest Inventory System (AFIS) and Southern 
Annual Forest Inventory System (SAFIS) will rely heavily on 
cooperator field support.
    Question. The Green Mountain National Forest is currently 
leasing its headquarters facility in Rutland, VT. If the Forest 
Service was to move to smaller space that it would purchase, 
what cost saving could be expected?
    Answer. The Green Mountain National Forest headquarters is 
currently located in Rutland, Vermont, in a leased facility. 
This leased facility is comprised of 17,056 square feet of 
office space and a 2,700 square foot garage. The present annual 
least cost, which includes building and grounds maintenance, is 
$205,000.
    As the result of streamlining of the Forest organization, 
which has included a substantial reduction in the headquarters 
staffing level, the Forest headquarters has reduced its office 
space needs to approximately 13,000 square feet.
    The Forest is beginning the process of exploring 
alternatives to their current lease. These alternatives 
include: a possible renegotiation of the current lease, taking 
into consideration the reduced space needs; the purchase of an 
existing or new facility; and the construction of a new 
facility. Each alternative for office space would be based on 
the projected need of approximately 13,000 square feet.
    Part of the process of exploring alternatives to the 
current lease will be the completion of a comprehensive cost 
analysis. This analysis will be completed utilizing the OMB 
Circular A-94 life cycle cost methodology. Because this cost 
analysis has not yet been completed, we do not yet know what 
cost saving could be expected if the Forest would move to 
smaller space that it would purchase or construct. In order to 
accurately determine the benefit/cost of relocating the Green 
Mountain SO, a pre-construction analysis of alternatives needs 
to be completed. The estimated cost of this analysis is 
$35,000.
    Question. Which national forests are estimated to have the 
highest visitor use? Which forests have the highest recreation 
use per acre?
    Answer. We do not currently have information on recreation 
use per acre by national forest. Due to the multiple use nature 
of the activities, goods and services provided by national 
forest system lands, we are unsure the conclusions would be 
accurate based on the data. For example, a forest that has 
large acreage, but relatively few developed recreation use 
areas may still receive very high recreation use. However, the 
high impact on the recreational areas would be masked by the 
total forest acreage.
    We do, however, have information on which forests have the 
highest recreation use. In fiscal year 1992 and fiscal year 
1995 the Regions were asked to submit their top 5 forests. The 
top 12 in fiscal year 1995 and the top 10 in fiscal year 1992 
follow:

                     NATIONAL FORESTS RANKED BY AMOUNT OF RECREATION USE IN FISCAL YEAR 1995                    
                                                   [Thousands]                                                  
----------------------------------------------------------------------------------------------------------------
                                                                                    Recreation                  
                    Forest name and State                        Rank   Regions    visitor days     Visits \2\  
                                                                                       \1\                      
----------------------------------------------------------------------------------------------------------------
Wasatch-Cache/Uinta--UT-WY...................................    \3\ 1        4         10,518.2        32,520.1
Tonto--AZ....................................................        2        3         10,507.3        38,184.5
Coronado--AZ.................................................        3        3          9,903.9        11,305.0
Inyo--CA.....................................................        4        5          9,839.2        29,985.2
Angeles--CA..................................................        5        5          9,815.9        29,579.2
White River--CO..............................................        6        2          8,045.0        10,136.7
Gifford Pinchot--WA..........................................        7        6          7,690.1        34,780.1
Pike/San Isabel--CO..........................................    \3\ 8        2          7,325.0        15,311.0
National forests in North Carolina--NC.......................    \3\ 9        8          6,756.3        19,905.8
Coconino--AZ.................................................       10        3          6,628.7         8,500.0
Mount Baker-Snoqualmie--WA...................................   \3\ 11        6          6,551.8        23,070.8
San Bernardino--CA...........................................       12        5          6,353.4         1,852.0
----------------------------------------------------------------------------------------------------------------
\1\ A recreation visitor day (RVD) is a statistical reporting unit consisting of 12 visitor hours. A visitor    
  hour is the presence of a person on an area of land or water for the purpose of engaging in one or more       
  recreation activities during a period of time aggregating 60 minutes.                                         
\2\ Visits an entry of one person upon a National Forest for the purpose of participating in one or more        
  recreation activities for an unspecified period of time. Only the ``primary'' activity of the recreation      
  visitor is recorded.                                                                                          
\3\ Multiple forests.                                                                                           


                     NATIONAL FORESTS RANKED BY AMOUNT OF RECREATION USE IN FISCAL YEAR 1992                    
                                                   [Thousands]                                                  
----------------------------------------------------------------------------------------------------------------
                                                                                                    Recreation  
                     Forest name and State                            Rank           Region        visitor days 
----------------------------------------------------------------------------------------------------------------
Tonto--AZ......................................................               1               3          9,247.4
Angeles--CA....................................................               2               5          9,158.0
Inyo--CA.......................................................               3               5          8,376.3
White River--CO................................................               4               2          8,232.3
Dixie--UT......................................................               5               4          6,175.6
Coconino--AZ...................................................               6               3          5,788.4
National forests in North Carolina--NC.........................           \1\ 7               8          5,767.3
Pike San Isabel--CO............................................               8               2          5,590.3
San Bernardino--CA.............................................               9               5          5,501.1
Mount Baker-Snoqualmie--OR.....................................          \1\ 10               6          5,498.3
----------------------------------------------------------------------------------------------------------------
\1\ Multiple forests.                                                                                           

    Question. What were the criteria used and how were they 
weighted under the new budget allocation process for fiscal 
year 1997 operating funds? Was there regional flexibility in 
applying or weighting these criteria? How much flexibility does 
an individual forest have in reprogramming funds between budget 
lines once the allocation has been made? Within Region 9 and 
for the Green Mountain National Forest, which budget line items 
saw the largest increase and decrease in funding levels from 
the previous year? Has the Forest Service compared these 
funding levels to the activity priorities in individual Forest 
Plans? Is the Forest Service going to revisit these criteria 
during the fiscal year 1998 allocation?
    Answer. The Forest Service has been using a criteria-based 
approach for allocating funds in the agency's budget process 
for several years. The development and refinement of criteria 
has been an on-going effort involving Washington Office and 
Regional resource and budget staffs. NFS and Construction 
staffs have particularly focused on refining and using 
allocation criteria.
    For fiscal year 1997, the criteria were used as a starting 
point for the initial and final allocations to field units in 
the Program Budget Advice. The criteria used for the NFS and 
Construction appropriations differed from program to program, 
but they basically measured the resource base, workload or 
accomplishments and complexity. For most programs, Regional and 
Washington Office staffs developed options and reached 
consensus on allocation criteria and their weights.
    For any given region, three factors would have led to 
increases or decreases in funding for a line item in fiscal 
year 1997: total funding appropriated, the amount of funds 
needed to operate the National headquarters, and the criteria 
used. Since moving to a criteria-based approach could result in 
significant shifs in program funding among units, an adjustment 
or ``bridge'' was applied to all regions to limit an increase 
or decrease of no more than 10 percent in a region's percent 
share of the available funding from 1 year to the next. For 
fiscal year 1997 Region 9 implemented a similar allocation 
process for distributing funds to its National Forests. Region 
9 provided each forest with a base level of funding to support 
basic management needs and then allocated the remaining funding 
using criteria.
    Allocation criteria will continue to be used in fiscal year 
1998. For some programs, the criteria used for fiscal year 1997 
were or will be revised for fiscal year 1998. Given the 
complexity of managing natural resources, no set of criteria 
will yield a perfect allocation. Review and possible 
adjustments to the results of criteria application will 
continue to be necessary to address emerging issues and changed 
conditions.
    Question. In 1990, the National Research Council made a 
number of recommendations for the Forest Service program. Has 
the Forest Service implemented any of the recommendations?
    Answer. Yes. USDA Forest Service Research (FSR) has 
included the NRC's ``Forestry Research: A Mandate for Change'' 
to strategically plan its program of research since it was 
issued in 1990. We believe we have implemented in various 
degrees a number of the recommendations.
    In their executive summary, the National Research Council 
(NRC) identified recommendations under (1) the Status of 
Forestry Research, (2) Support for Forestry Research, (3) 
Maximizing the Benefits from Forestry Research. Some of 
recommendations pertained to Forest Service Research, others to 
forestry research conducted by universities, industry, or 
others. Specific recommendations implemented by Forest Service 
Research (FSR) are:
    1. The Status of Forestry Research:
    Provide vastly expanded competitive funding.--FSR use of 
competitive funding mechanisms increased after 1990. However, 
the ``vastly expanded'' competition envisioned in the report 
has not materialized. For example, the global change research 
program provided several competitive opportunities in fiscal 
year 1992-1995. Since then, global change funds have been 
allocated to extend and complete projects initiated 
competitively. An 8 percent FSR budget reduction in fiscal year 
1996 coupled with lack of funding increases to cover inflation, 
have made it difficult to expand competitive funding.
    Create centers of scientific emphasis supported by public 
and private research organizations.--FSR is involved in several 
centers of excellence, working closely with universities, state 
governments, industries, and private forestry groups. These 
centers broadened FSR's research capabilities through 
establishing strong partnerships. Research addressed under the 
auspices of these centers are tied to regional and national 
research issues. For example, the Alabama Consortium (SRS-4107, 
Alabama A&M University, and Auburn University) entered into a 
collaborative endeavor incorporating the expertise of 
scientists, forest managers, and forest owners. The Consortium 
seeks to create new information through research, to utilize 
existing knowledge, and to expand education and technology 
transfer for the benefit of land managers. Another example, the 
FSR is exploring, with the Bureau of Land Management, National 
Park Service, and others, creation of ``Cooperative Ecosystem 
Study Units'' in several regions. The intent of these units is 
to create interagency and multi-university centers of emphasis 
in natural resources research and education. As budgets decline 
and downsizing progresses FSR continues to merge units into 
larger integrated units of research. FSR has research 
facilities located on or adjacent to 42 university campuses 
which enhance our ability to collaborate with university 
centers of excellence.
    Increase the quality of forestry research by opening it up 
to the broader scientific community.--We have taken advantage 
of opportunities to engage in scientific exchange and 
collaboration with other research organizations. For example, 
we have strengthened ties with the Ecological Society of 
America and the Society for Conservation Biology to expand the 
range of expertises available to work in complex issues. In 
addition, many of our researchers are members or officers of 
related scientific and professional societies, such as the 
American Economics Association and the Soil Science Society. 
Society activities have brought new thinking and skills to 
forestry research.
    Establish research-management collaborations at large 
spatial scales.--FSR has worked with the National Forest System 
to create ``Adaptive Management Areas.'' Successful studies are 
underway in North Carolina, Georgia, and Arkansas in addition 
to Oregon and Washington. In fiscal year 1994 FSR initiated 20 
large-scale ecosystem management projects across the entire 
United States and Puerto Rico. Many of these long term studies 
are in progress and involve collaborative efforts with 
universities, industry and the NFS.
    Develop a cadre of forest and related scientists that 
reflect the national, and global population composition and 
that are equipped to solve domestic, international, and global 
problems.--FSR has the same distribution of ethnicities (within 
0.5 percent in each category) among its total employee pool in 
1997 as it did in 1990.
    Establish a National Forestry Research Council.--In 
response to this recommendation, USDA proposed the 
establishment of a subcommittee to coordinate forestry 
research, through the Office of Science and Technology Policy 
(OSTP) and the Federal Coordinating Council for Science, 
Engineering and Technology (FCCSET). A forestry subcommittee 
was near charter and constitution stages at about the time the 
Executive Branch changed administrations. The subcommittee was 
not formed and the new administration has been directing 
science planning through a new structure, the National Science 
and Technology Council (NSTC) and the Office of Science and 
Technology Policy. FSR has been involved in this planning 
effort. In April, 1993, USDA chartered the Forestry Research 
Advisory Council (FRAC). FRAC replaces the Cooperative Forestry 
Research Advisory Council, which existed to serve the 
Cooperative Forestry Research Program (McIntire-Stennis) only. 
FRAC's charge is broadened to include all forestry research 
supported through USDA and addresses a broader range of 
national forestry research issues.
    Other recommendations.--To support basic forestry teaching 
and research through NFRC, to strengthen teaching, to establish 
long-term forestry research grants, and to establish 
competitive graduate fellowships--have not been implemented. 
Most of these require action by groups other than FSR or 
additional funding beyond that made available since 1994.
    2. Support for Forestry Research:
    Increase FSR budget by 10 percent per year, for the next 5 
years.--Between fiscal year 1990, when the NRC report was 
issued, and fiscal year 1995, appropriations rose from $150.9 
million to a peak of $193.5 million (nominal dollars). Since 
1995, FSR appropriations have declined to $179.8 million today. 
Complete fulfillment of the NRC recommendation would have 
resulted in an FSR budget of $243 million in 1995. The nominal 
funding increase from fiscal year 1990 to 1995 amounted to 
slightly more than a 5 percent annual increase. When the 
effects of inflation are factored in using 1995 dollars, the 
fiscal year 1990 budget was $172.5 million (1995 constant 
dollars) leading to a 2.3 percent annual increase from fiscal 
year 1990 to fiscal year 1995. Compared to the fiscal year 1990 
constant dollar level, the fiscal year 1997 level of $172.6 
million (1995 constant dollars) shows no change.
    Conduct a national assessment of current status of forestry 
facilities and equipment.--As part of the 1995 Farm bill, a 
national assessment of agricultural research facilities is in 
progress (USDA Facilities Review Team). Federal and university 
forestry laboratories are part of this assessment. No national 
assessment of forestry research equipment has been conducted.
    Other recommendations.--Increase competitive grant funding 
for forestry research in the USDA in the National Research 
Initiative to $100 million annually and increase McIntire-
Stennis funds to 50 percent of the FSR budget--have not been 
implemented. The current funding level in the NRI for forestry 
research is less than $20 million and the McIntire-Stennis 
funding level is less than 15 percent of FSR funding. On 
average, 12.3 percent of the FSR is committed to extramural 
research, most of this to grants and agreements with our 
university partners. Decreasing budgets and downsizing have 
limited and resulted in a decrease over the past 2 years.
    3. Maximizing the Benefits from Forestry Research:
    Encourage scientists to assume a leadership role in 
communicating their knowledge to policy makers.--``Forest 
Service Ethics and Course to the Future'' emphasizes that one 
of the keys to our effectiveness as a conservation leader is 
expanding collaboration between scientists and practitioners 
and better integrating science into policy issues. Researchers 
have played important roles in major regional assessments, such 
as FEMAT, the Southern Appalachian Assessment, the Sierra-
Nevada Ecosystem Project, and the Columbia River Basin study, 
communicating their knowledge to policymakers. FSR also co-
hosted two high-level workshops to explore why we have been 
successful in certain efforts and less successful in others in 
bringing science to policy making (``Navigating Into the 
Future, Rensselaerville Roundtable: Investigating Science and 
Policymaking''). Guidelines from these workshops (currently in 
draft form) will be disseminated agencywide.
    Establish a professional reward system for scientist that 
acknowledges the validity of efforts involved in outreach.--In 
1996, FSR completed the first major revision since the mid-
1980s in its policies and guidelines for evaluating research 
scientists. Much greater emphasis was placed on outreach 
activities in the revised guidelines so scientists who engage 
in outreach and coaching users on implementing research 
findings will get promoted faster.
    Communicate research results to a broader range of 
clients.--In the revised scientist evaluation guidelines, 
discussed above, increased emphasis has been placed on 
communicating research results to a broader range of clients 
and coaching users on efficient implementation of research 
findings. FSR has also been taking advantage of computer 
technology, such as the Internet and CD-Roms, for disseminating 
research results. These media often reach people faster and 
easier than journal articles or publications.
    Question. Describe the Forest Service research budget in 
constant dollars since 1990. How does this compare to overall 
trends in the Forest Service budget?
    Answer. In 1990 constant dollars:

                     FOREST SERVICE RESEARCH BUDGET                     
                          [Dollars in millions]                         
------------------------------------------------------------------------
                                  Forest Service                        
           Fiscal year                  \1\         Research    Percent 
------------------------------------------------------------------------
1990............................          $2,544         $151          6
1991............................           2,225          160          7
1992............................           2,293          168          7
1993............................           2,254          166          7
1994............................           2,391          172          7
1995............................           2,063          169          8
1996............................           2,127          153          7
------------------------------------------------------------------------
\1\ Total discretionary appropriations.                                 

    Question. What are the trends for number of scientists 
employed directly and in cooperative research units?
    Answer. The trend for number of scientists employed 
directly by the Forest Service is down from 715 in fiscal year 
1990 to 548 in fiscal year 1996. We are not familiar with the 
term ``cooperative research units.''
    Question. What percentage of the Forest Service budget is 
used for cooperative research?
    Answer. When we speak about cooperative research we 
generally mean extramural research. The percentage of 
extramural research is determined by two factors, the work 
needed to accomplish our mission and the level of funds 
available for that year. Extramural research averaged 24 
million dollars the past 5 years, approximately 13 percent of 
annual appropriations.
    Question. What percentage of forest Service research is 
focused on timber production vs. other management activities of 
the Forest Service?
    Answer. We estimate that 28 percent of the Forest Service 
research budget is focused on timber production. In addition, 
the research accomplished by our Forest Products Lab and other 
forest products, utilization and wood processing research, an 
additional 9 percent of the budget, contributes to improved and 
expanded ways to use wood fiber including material that needs 
to be removed to improve forest health through utilization of 
small diameter trees.
    Question. Has the Forest Service ever conducted a study 
looking at the impact on estate taxes on private forestland, 
specifically looking at the number of large parcels sold due to 
estate taxes?
    Answer. No. The Forest Service shares this concern and the 
Cooperative Forestry Staff has a study of this issue proposed 
for fiscal year 1998. However, we believe the issue is broader 
than just forestland and there should be a USDA effort to look 
at the effects of estate, gift, and capital gains on farmers, 
ranchers, and forest landowners and the conversion/
fragmentation of their land holdings attributable to estate 
taxes.

                          subcommittee recess

    Senator Gorton. The subcommittee will stand in recess until 
9:30 a.m., Thursday, April 24, when we will receive testimony 
from the National Endowments for the Arts and the Humanities.
    [Whereupon, at 11:42 a.m., Thursday, April 17, the 
subcommittee was recessed, to reconvene at 9:30 a.m., Thursday, 
April 24.]



  DEPARTMENT OF THE INTERIOR AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

                              ----------                              


                        THURSDAY, APRIL 24, 1997

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 9:30 a.m., in room SD-192, Dirksen 
Senate Office Building, Hon. Slade Gorton (chairman) presiding.
    Present: Senators Gorton, Stevens, Cochran, Burns, Bennett, 
Gregg, Campbell, Bumpers, Dorgan, and Boxer.

                    NATIONAL ENDOWMENT FOR THE ARTS

STATEMENT OF JANE ALEXANDER, CHAIRMAN

                             budget request

    Senator Gorton. This subcommittee hearing will come to 
order. We are going to hear this morning from the Chairmen of 
both the National Endowment for the Arts and the National 
Endowment for the Humanities and review with them their 
proposed budgets for the coming fiscal year.
    Ms. Alexander and Dr. Hackney began their tenures at the 
two Endowments almost 4 years ago. Since that time, each has 
been in the unenviable position of having to execute 
substantial budget cuts for their agencies enacted by Congress 
in an effort to address the budget deficit.
    As chairman of this subcommittee, I have a keen 
appreciation of their situation. The amount of budget authority 
available to fund the many agencies within the jurisdiction of 
the Interior bill has declined by about $1 billion since 1995, 
when I assumed the chairmanship.
    For the current year, the National Endowment for the Arts 
is funded at $99.5 million, the National Endowment for the 
Humanities at $110 million. Both agency budgets include 
proposed increases in their fiscal year 1998 programs that 
would provide a funding level of $136 million for each, thereby 
partially restoring the cuts that were made in 1996 and 
sustained in the current fiscal year.
    I believe I can say with great certainty, though I do have 
the chairman of the overall committee here, that I do not 
anticipate that there will be an increase of similar magnitude 
in this subcommittee's budget allocation. Instead, my 
expectation is that we may face a further decline in available 
dollars. As a result, that will mean that for each increase 
provided for one agency budget a corresponding decrease will 
have to be taken in another.
    At the same time, I think it is appropriate to say that the 
debate over the continuation of the two Endowments which has 
been so prominent in the House of Representatives is much less 
prominent here in the Senate. There has been in each of the 
past 2 years, and I am sure will continue to be, substantial 
support for the Endowments and for their continuation.
    That does not make finding money for them any easier, and 
whether or not there will be even the slightest increase in 
allocation for this subcommittee will depend largely on budget 
negotiations which now seem to me to be reaching a climax.
    Ms. Alexander, and for all of the audience here, I will 
explain the chart or the display that we have there 
[indicating].
    [The information follows:]

Interior programs fiscal year 1997 enacted

                                                                        
Land management programs:
    Forest Service......................................  $2,361,000,000
    National Park Service...............................   1,414,000,000
    Bureau of Land Management...........................   1,090,000,000
    Fish and Wildlife Service...........................     653,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................   5,517,000,000
                    ========================================================
                    ____________________________________________________
Indian programs:
    Indian Health Service...............................   2,054,000,000
    Bureau of Indian Affairs............................   1,606,000,000
    Navajo-Hopi/IAIA/special trustee/Indian gaming/
      Indian education..................................     119,000,000
                    --------------------------------------------------------
                    ____________________________________________________
        Total...........................................   3,779,000,000
                    ========================================================
                    ____________________________________________________
Science and minerals management programs:
    Geological Survey...................................     739,000,000
    Office of Surface Mining [OSM]......................     272,000,000
    Minerals Management Service [MMS]...................     163,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................   1,174,000,000
                    ========================================================
                    ____________________________________________________
Energy programs:
    Energy conservation R&D.............................     570,000,000
    Fossil energy R&D...................................     365,000,000
    Naval petroleum NPR/reserves........................     144,000,000
    Energy information administration/economic 
      regulation........................................      69,000,000
    Alternative fuels production........................      -4,000,000
    Clean coal technology...............................    -123,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................   1,020,000,000
                    ========================================================
                    ____________________________________________________
Cultural programs:
    Smithsonian Institution.............................     370,000,000
    National Endowment for the Humanities...............     110,000,000
    National Endowment for the Arts.....................      99,000,000
    National Gallery of Art.............................      60,000,000
    Holocaust Memorial..................................      31,000,000
    Institute of Museum Services........................      22,000,000
    Memorials...........................................      41,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     733,000,000
                    ========================================================
                    ____________________________________________________
Interior departmental offices:
    Interior affairs....................................      88,000,000
    Departmental management.............................      58,000,000
    Solicitor...........................................      35,000,000
    Inspector general...................................      25,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     207,000,000
                    ========================================================
                    ____________________________________________________
      Total bill........................................  12,430,000,000

        distribution of funds appropriated through subcommittee

    Senator Gorton. That display indicates the distribution of 
the funds in the current year that are appropriated through 
this subcommittee. The green on the left are land management 
agencies; the blue are the Indian programs; and the much 
smaller additional ones have to do with minerals management, 
energy programs, and the like.
    Cultural programs and the Endowments are the next to the 
last, next to the right, and as you can see even within the 
context of this bill, they represent a relatively modest amount 
of our appropriation. Within those cultural institutions, 
however, are the Smithsonian Institution, the National Gallery 
of Art, and a number of other institutions for which we are 
almost solely responsible as opposed to the arts of the country 
taken as a whole.

                 support for continuation of endowment

    I do want to emphasize that wherever we come out on funding 
in fiscal year 1998, the subcommittee clearly supports the 
continuation of the two Endowments. This hearing today is 
intended primarily to provide subcommittee members with the 
opportunity once again to demonstrate that support and to ask 
questions rather than to debate the future existence of either 
the Endowment that you head or the National Endowment for the 
Humanities.
    It has been 1 year since you appeared before this 
subcommittee. In the intervening months the most significant 
issues that you faced have not changed a great deal, but you 
have represented a very strong and eloquent voice for the 
National Endowment for the Arts.
    Ms. Alexander, we will start with you today.
    Senator Campbell. Mr. Chairman, are we going to be allowed 
to make opening statements?
    Senator Gorton. You certainly are. We are going to give 
each member of the subcommittee an opportunity to speak. 
Senator Stevens is the chairman of the overall committee as 
well. He said he did not have an opening statement earlier, but 
I am going to ask him again whether he does want to say 
anything.
    Senator Stevens. No; thank you.
    Senator Gorton. OK. We will pass. Senator Boxer.

                opening remarks of senator barbara boxer

    Senator Boxer. Thank you very much, Mr. Chairman.
    I want to start off with an apology, because I am on the 
Budget Committee and there is a briefing at the White House, 
and without a budget it is very hard for your subcommittee and 
all the subcommittees and for Chairman Stevens to do his work, 
so I am going to have to run out, but my heart is here with the 
people who believe that it is crucial for our Nation to 
dedicate some of its treasure to the arts.
    I think it is absolutely extraordinary that there would 
even be an argument, and I think our chairman has pointed out 
that the argument over the existence of the NEA is more of an 
argument in the House, in which I served for many years, 
although it came rather late in the game when the leadership 
changed hands.
    But I have to say that we spend 38 cents per person on the 
arts in this country. If anyone thinks that is too much, I 
would say to them they ought to think about what it all means. 
I think the modest increase put forth by the President is just 
that. I would like to even do more than that, because I have 
seen the effect of the arts on children. I know that when you 
make these small investments they are leveraged mightily. I 
know that they are leveraged in such a way that they help bring 
economic development to communities and it is a tremendous 
community experience to see a small amount of money at work.
    Now, the funding that the President requested--$272 million 
for the arts and humanities--is a mere one one-hundredth of 1 
percent of the entire Federal budget. It does get leveraged in 
the community. That is important. But it is one one-hundredth 
of 1 percent of the total budget, and millions of Americans 
across the country have an opportunity to view history in arts 
that otherwise would be inaccessible.

                      president's request for neh

    The President's request of $136 million for fiscal year 
1998 for the NEH will enable the Endowment to continue to 
support many activities, including the cataloging of 
Presidential papers and the preservation of newspapers of the 
Nation's early history. No country can survive if they cannot 
learn from history. This is very important.
    In the last 5 years, institutions and individuals in my 
home State of California have received $63 million from the NEH 
and the California Council of Humanities for projects that help 
preserve the Nation's cultural heritage, foster lifelong 
learning, and encourage civic involvement.
    Of note, the Fowler Museum of Cultural History at UCLA 
received $450,000 for the Royal Tomes of Saipan, an exhibit of 
artifacts from ancient Peru that drew 100,000 visitors from 
California and more than 1.2 million visitors nationwide. All 
of those visitors come and they stay there and they walk down 
the street, they go to the restaurants, and they bring 
business. They go to the stores.

                    importance of nea to california

    Now, on the NEA, for 32 years the NEA has led the way in 
making art accessible to Americans throughout the country. Arts 
education, theater projects, dance troupes, opera companies 
that nurture young artists and strengthen communities. Those 
are funded by the NEA, by NEA grants.
    Now, I just want to say straight out not every single grant 
is perfect. I do not agree with every single grant. It is very 
subjective, and a couple of them get people upset. Now, I think 
we have to realize that we are all human beings. Mistakes will 
be made and judgments may be flawed when looking at it from 
one's perspective and one's own values and culture, but what 
has always interested me is that those who yell the loudest are 
the ones who look the longest at the very projects that they 
say are so terrible.
    I say we are born with a neck. You can turn your head away, 
and you can criticize, and I encourage that criticism. I think 
it is healthy to criticize. If you think that a grant is wrong, 
say it. I think some are as well, and I say it, too, but it 
does not mean that you just say, well, therefore, we cannot 
have this program. It means that we work with you, and Jane 
Alexander you have been extraordinary, I think, to work with, 
and you make sure that mistakes are the fewest that they can 
be.
    Recently in my State the Endowment granted $150,000 to the 
Los Angeles County Music and Performing Arts Commission for a 
cultural tourism development program. This is one of several 
regional cultural tourism forums funded throughout the country. 
The NEA has awarded $30,000 to the Balboa Art Conservation 
Center in San Diego for improving the collections storage needs 
of midsize and small museums throughout California.
    Mr. Chairman, I am at the end of my statement. I feel very, 
very strongly that the President's proposal for NEA funding 
will broaden public access to the arts for all Americans to 
participate in and enjoy, in order to improve the quality of 
life for our children and our families. And again, I am so 
sorry that I cannot stay for this entire hearing, but, Mr. 
Chairman, I hope that we can work together so that we have a 
good bipartisan agreement at the end of the debate.
    Senator Gorton. If you have any questions, we will be happy 
to submit them.
    Senator Boxer. Thank you, Mr. Chairman.
    Senator Gorton. Senator Burns.

                  prepared statement of senator burns

    Senator Burns. I just have a statement that I would like to 
submit for the record, sir.
    [The statement follows:]

               Prepared Statement of Senator Conrad Burns

    Thank you, Chairman Gorton, for holding this hearing today.
    I'd like to welcome Ms. Alexander and Mr. Hackney here 
today. We appreciate your coming in to talk about your 
agencies. I had the pleasure of discussing old movies from my 
wrangler days with Ms. Alexander yesterday afternoon. I worked 
on The Rare Breed, but unfortunately not Calamity Jane.
    Both of you have done well running your agencies under 
tough circumstances. The battles certainly aren't over, but at 
the same time we may be approaching the signing of a truce. 
From what I see and hear, support for the arts and humanities 
remains strong in Montana and around the country.
    I look forward to hearing how efficiently your agencies are 
running and what each of you is doing to raise funds from 
private sources, and if those efforts are having success.
    Thank you again for being here this morning.

                  opening remarks of senator campbell

    Senator Gorton. OK. Senator Campbell.
    Senator Campbell. Thank you, Mr. Chairman.
    I am prompted to make an opening statement really based on 
a letter that I saw from a colleague who happens to be a 
terrific friend of mine from the House side, which I will 
explain a bit later.

                   preservation of cultural treasures

    I would like to direct the attention of the committee and 
people who are here to those wonderful baskets over there in 
those glass cases, or this one that was provided by one of my 
staffers on the Indian Affairs Committee, that were made so 
tight they will actually hold water with no glue or anything. 
It is just wonderful creative work of Indian culture.
    I would like to certainly identify myself with the comments 
that Senator Boxer made. I think the arts serve an extremely 
important role. You can look at it from a lot of different 
viewpoints, certainly in Santa Fe, Jackson, places like that, 
it becomes part of the basis for their economy, but the point I 
would like to make, I guess, is that I think there is a place 
where we need to define the real importance of preserving 
cultural treasures that are in the art world, not only visual 
ones like this but song, dance, storytelling, and a lot of 
other things, too.
    I lived in Japan for a number of years, as you know, and I 
went to a Japanese university. In Japan, the Federal Government 
actually gives a title to people who have spent their whole 
life in a certain art form, perhaps bonsai--you know, the 
little miniature trees--things of that nature.
    As they reach a certain degree of skill the Federal 
Government gives them a title of living cultural treasure, and 
in fact gives them a stipend, gives these wonderful people a 
stipend to keep that skill alive. That is why in Japan you have 
things that were practiced as far back as the 15th century that 
may not have any, you know, visual economic use, but they are 
still practiced today because the Government has recognized the 
importance of preserving cultural treasures.
    I would certainly like to see that in this country, too, 
and that probably will never happen, but at least I think we 
have an obligation to define the things that are fast 
disappearing.
    These baskets are just an example. They came out of the 
Southwest, but if any of you are ever in the State of 
California, Senator Boxer's State, and have the opportunity to 
go to the State Indian Museum, which is located right behind 
Sutter's Fort in Sacramento, CA, there are examples of baskets, 
believe it or not, that were woven so small they are on 
pinheads. They are in a glass case like that one over there.
    They have a big magnifying glass. You have to look through 
the glass to be able to see the finest of those baskets. Some 
of them were woven out of the feathers from humming bird's 
chests. Some of them they cannot even weave any more because it 
is a dying art. There are very few people who know how to do 
it, the Pomos, the Washos, some of the California tribes.
    Some weavers have given up because under the Endangered 
Species Act there are certain things they cannot collect, 
certain grasses, certain leaves, certain feathers, certain 
pieces of fur and so on, so they cannot do it, but they 
actually have baskets in that museum that were woven from the 
hair of a fern, a fern's hair, if you can imagine how fine that 
is.

          nea and the preservation of native american culture

    I wanted to point that out today because I know in some 
places there is a problem with some of the funding that goes 
through the NEA. We have all heard about Mapplethorpe over and 
over, ad nauseam, I guess.
    I have a lady who came to one of my town meetings a couple 
of years ago in Colorado suggest that we disband the NEA and 
NEH both because of some of the money that has filtered down 
through the National Endowments.
    I pointed out to her--that was during the debate of the 
$1,000 coffee pots and $800 hammers that the Air Force was 
buying, and I suggested to her that maybe we ought to just 
delete all the money for military defense because somebody made 
a dumb mistake, and in that context I think she understood why 
we should not use a sort of all-or-nothing phrase when talking 
about the National Endowment for the Arts because there were a 
few grants that went out that most Americans would disagree 
with.
    But my friend and colleague on the House side, who I have 
known for many years and who I think is a very fine man, 
Congressman Wally Herger from Senator Boxer's State--I have 
great respect for him and I do not mean to single him out, but 
he did recently send out a Dear Colleague letter saying--the 
title was, ``NEA Funds Basket Weavers,'' as if to imply that 
basket-weaving is, you know, just kind of a pastime and not 
important, and one of those things most Americans would think 
was frivolous and we ought to get rid of the funding for that.
    It was a $60,000 grant, in fact, that the NEA gave to 
California basket weavers for a statewide gathering of basket-
weavers, and western regional Indian basket weavers, to try to 
preserve that art form.
    I want to also bring a couple of pictures of some of them 
that are blown up, if you can see them--I hope you can. These 
are traditions--you know, if you paid a person to weave this 
they would probably get 20 cents an hour or something. There is 
no money in this, very little.
    Only a few of the very famous potters and weavers of rugs 
and so on can actually make money, but these things are not 
from the standpoint of making a living for people. You just do 
not.
    And how many children, how many babies in Indian country 
are still carried in these baby bassinets? Very few. Some of 
the traditional people do, but a lot of women keep that skill 
alive simply to preserve it as a cultural heritage, important 
to them. This is something that is handed down from mother to 
daughter, grandmother to granddaughter, and it just seems to me 
that it comes under the same category as perhaps wood carvings 
in Appalachia, or some of the other things that we often think 
of that have come down, that has made our country have a fabric 
that binds us all together.
    These happen to be made by American Indians, but certainly 
the richness of the skills belong to all of us as Americans, 
and I think we have an obligation to try to keep them alive, 
and I just wanted to bring them in and let my colleagues see 
how easily we can get sidetracked when we are talking in these 
deficit times, when we have to watch every buck, that we might 
end up doing something that we would really regret centuries 
from now, if we inadvertently, through our inability or 
inaction in trying to help the arts, kill the tradition that 
belongs to all of us.

                           prepared statement

    I thank you, Mr. Chairman. I might also recommend to 
anybody who would like to look into some of those very, very 
fine baskets that I mentioned that are done on pinheads and 
with very fine materials, this wonderful book on California 
Indian basketmaking that I am sure Senator Boxer already has.
    Thank you for your time, Mr. Chairman. Please include my 
prepared statement in the record.
    Senator Gorton. Thank you, Senator Campbell.
    [The statement follows:]

         Prepared Statement of Senator Ben Nighthorse Campbell

    Mr. Chairman, members of the committee, I would like to 
take this opportunity to offer a few brief comments on the 
National Endowment for the Arts and the National Endowment for 
the Humanities.
    Let me begin by saying that I'm glad the anti-arts folks 
haven't dampened the committee's spirit regarding the arts.
    Among the many important functions of both Endowments, I 
want to highlight the critical role they play in sustaining our 
national treasures. The argument that the arts should be 
privately funded, not federally funded, essentially translates 
into the argument that the Federal Government has no business 
in sustaining our national treasures. I wholeheartedly 
disagree.
    As we do with everything in Congress, I feel obliged to 
define ``national treasure.'' Quite simply, a national treasure 
is something that, if allowed to die out, be forgotten, or even 
ignored, will make us guilty of robbing our children of a piece 
of their heritage. National treasures include languages and 
paintings, sun dances and sculpture, cultural gatherings and 
functional art.
    As you may know, I lived for several years in Japan and was 
able to experience their high regard for the arts. The Japanese 
government actually has a national living treasure designation 
for masters of various cultural arts. They have seen fit to 
maintain, as an honor, artistic traditions and treasures dating 
back to the 15th Century.
    It is true that there is not widespread agreement on the 
definition of ``national treasure,'' or art or the humanities. 
It is also true that there may have been projects funded with 
federal dollars which, in retrospect, may not have been 
appropriate to fund.
    During a recent town meeting I posed this question to a 
Coloradan who shouted that I should disband the NEA and NEH, 
``Are you suggesting, then, that we eliminate the Department of 
Defense because they spent $800 on a hammer and $1,000 on a 
coffee pot?''
    Although federal funding of the arts comprises only a small 
fraction of its overall funding, many states, including my own, 
would suffer a serious blow from the elimination of federal 
funding. It is a little publicized fact that four states and 
the District of Columbia receive over half of the privately 
funded foundation grants for the arts. That doesn't leave much 
for the other forty-six states.
    In closing, I would like to call the Subcommittee's 
attention to a Dear Colleague letter that was recently 
circulated on the House side by Congressman Wally Herger. I 
have known and respected Wally Herger for many years, so I am 
not singling him out with any malice. Rather, I would like to 
use his letter as an example of the misinformation and 
misunderstanding surrounding the arts.
    The Dear Colleague is titled, ``NEA Funds Basketweavers,'' 
lists the amount and recipient of the grant, and closes with, 
``It's Time to Eliminate the NEA.'' The California Indian 
Basketweavers Association's receipt of a $60,000 grant to 
support the seventh and eighth statewide gathering of Indian 
Basketweavers, and the first Western Regional Basketweavers 
Gathering, is presented in the letter as an obvious reason for 
the elimination of the NEA.
    Indian Basketweavers in California, as well as all other 
basketweavers across the country, are artists in the purest 
sense of the word. The value of the intricately woven, 
detailed, and often functional baskets Indians weave is 
tremendous, in both the cultural and monetary sense. Indian 
basketweaving is not a hobby or frivolity to be demeaned or 
insulted. It is an important part of Indian history and 
culture, and as such should be treated with the respect it 
deserves. Without the grants provided by the NEA, the 
protection and promotion of an art form such as this is at 
risk. As a country, we run the risk of losing a national 
treasure if we target these programs as frivolous.
    I recommend that my Senate colleagues visit the California 
State Indian Museum in Sacramento. They have baskets there that 
fit on the head of a pin, woven with feathers from the chests 
of hummingbirds.
    On a personal note, I should tell you that my Staff 
Director of the Indian Affairs Committee has a Pima basket 
hanging on an eighth floor wall of the Hart Senate Office 
Building. It was woven by his grandmother with willow reeds and 
devil's claw, and won a First Premium Prize at the Arizona 
State Fair in 1968. In her eyes and in mine, it is the 
embodiment of heritage, family and artistic achievement, and a 
tangible treasure to be handed down from mother to daughter.
    In the way of proof, I have several baskets here for you to 
view. I thank Sally McClendon for bringing them in.
    Thank you, Mr. Chairman.

                opening remarks of senator dale bumpers

    Senator Bumpers. Mr. Chairman, unlike you I intend--and you 
are chairman, so you will probably have your way, but I 
certainly intend to do everything--I would like to double or 
triple what the President asked for for NEA and NEH both.
    I have done a lot of work on the F-22 fighter--that is, 
trying to kill it--over the last 4 months, and I just made a 
quick calculation. If we gave NEA the entire $136 million the 
President requested, that would be roughly two-thirds of the 
cost of one F-22 fighter, and I invite everybody to use your 
imaginations as to where I would go if I had the time on that 
one.
    I can tell you that this society of ours--Justice Holmes 
said it one time. You pay taxes. Taxes are what you pay in 
order to live in a civilized society. That is a very profound 
statement, and the other day on tax day when everybody was 
saying we ought to abolish the IRS and all taxes, I pointed out 
that I do not enjoy paying taxes. I coughed up a big chunk last 
week, for me--not for some people, but it was a lot for me, and 
I did not enjoy it, but I do not begrudge it.

                      society's need for the arts

    While I do not enjoy paying taxes I do enjoy living in a 
reasonably civilized society, in what we all profess to believe 
is the greatest Nation on Earth, but I can tell you, one of the 
things that will cause this Nation to deteriorate and 
degenerate faster than anything I can think of is to literally 
turn your back on the arts and the humanities. They go right to 
the heart of the kind of country we are.
    You can tie the crime rate to this. The U.S. Government 
pays approximately $24,000 per inmate a year to house 106,000 
people in Federal prisons, and many times that amount in State 
prisons.
    Now, Jane, you have heard me make this speech before, but 
when I was Governor and would go to the penitentiary and have 
lunch with the inmates--it took me a long time just to get up 
my nerve to even go down there, because killings were fairly 
prevalent, and I thought I might be the next one.
    But I visited with the inmates in the dining room, had 
lunch with them, and in all the 4 years I was Governor and all 
the inmates I interviewed, I never ran across one that played 
in the high school band. I never ran across one that had a role 
in the senior class play. I never ran across one that had a 
college degree, though there were a few of them--not many--and 
so I could go on and on with those kinds of illustrations.
    What does that tell you? That is as graphic and as 
compelling an argument as I can think of for this program. It 
is about one-half what it was 4 or 5 years ago.
    We do not benefit greatly. I have some trouble with the 
funding formula, because a poor State like Arkansas--but we 
have a great repertory theater. We have got an amazing 
orchestra for a city the size of Little Rock, the concerts are 
all full. People enjoy it immensely. So you know, it is not all 
lost.
    My administrative assistant and I were driving to work this 
morning and she had been intending to go to New York last week 
to the opera. The only ticket left was $200, and that cooled 
her zeal for going to the opera, but she said that her brother 
had tried to get tickets and the entire Metropolitan season is 
sold out. There is not a seat left.
    Now, that speaks well for New York, and it speaks well for 
the country in a way, but I firmly believe that the National 
Endowment for the Arts is as essential to this Nation almost as 
our defense system, and I can tell you, if we were spending 10 
times more than we are spending you would see a much more 
civilized society.
    Those are my sentiments, Mr. Chairman.
    Senator Gorton. Thank you, Senator Bumpers.
    Senator Cochran.

                   opening remarks of senator cochran

    Senator Cochran. Mr. Chairman, let me join you in welcoming 
Ms. Alexander to our hearing and to thank her for her continued 
cooperation and good efforts in the job she has, which is one 
of the most difficult, I think, given the high visibility and a 
lot of the controversies that have swirled around the decisions 
made by the Endowment in the past.
    I think she has brought a keen understanding and a 
dedication to this job and its importance in our society; she 
has instituted a lot of changes, some welcome, some criticized. 
But the fact is there are new policies in place that have 
helped avoid some of the embarrassments of past grantmaking by 
the agency, but at the same time nurtured and encouraged 
creative talents throughout our country, particularly in small 
towns and rural areas of my State and others, which I think is 
something that is often overlooked by those who want to 
criticize or actually destroy the Endowment.
    I suppose I have been on this subcommittee longer than 
anybody has been on this subcommittee now, except maybe Senator 
Stevens or somebody on the other side of the aisle. One of the 
controversies I recall in my first Congress serving on this 
subcommittee is whether we would continue to make grants to 
individual artists, and we had a rollcall vote in this 
committee to overturn a recommendation by the new chairman of 
the subcommittee on that subject.
    So controversy is not new to this subcommittee. We have 
made a lot of decisions and tried to improve the operation of 
the Endowment and make it sensitive to the values that many 
people have about the appropriateness of certain kinds of 
projects that are federally funded or federally supported. But 
my conclusion is that Ms. Alexander has done a tremendous job, 
and we ought to commend her and thank her for her perseverance 
and her continued grace and dedication to doing the great job 
that is required of the chairman of the National Endowment for 
the Arts.
    Thank you.
    Senator Gorton. Ms. Alexander, perhaps the best compliment 
you have been given here is that there has already been a 
quorum of this subcommittee present. None of my previous 
hearings of this subcommittee have had more than three members, 
and in most of those cases, except for perhaps 5 minutes, I was 
there alone.
    I should also tell you there is another subcommittee of the 
Appropriations Committee meeting now. I know that both Senator 
Stevens and Senator Burns have felt that they have to be there, 
and each of the two of us also is missing a hearing of the 
Commerce Committee. So we are happy to have you here, and this 
attendance is an indication of the interest in your subject.
    At this point we have talked a lot. We will be happy to 
listen to your opening statement.

                  summary statement of jane alexander

    Ms. Alexander. Thank you, Mr. Chairman and members of the 
subcommittee. I am pleased to come before you today to speak in 
behalf of an agency that I think has had a remarkably 
successful 32-year history, and an agency to which I owe my own 
career as an actress, and to which I am eternally grateful for 
its existence.
    I would like to respond if I may to some of the Senators' 
fine remarks with regard to the agency and submit my testimony 
for the record.
    Senator Gorton. It will be included in the record.
    Ms. Alexander. Thank you.

                        federal role in the arts

    The investment that the Endowment has made over 32 years in 
the creative and imaginative life of our communities and our 
citizens everywhere and the quality of life in the communities 
and the economic development and vitality of some of those 
communities has been significant, specifically in its ability 
to leverage other public and private moneys and to provide 
opportunity and access for all. That has been the agenda for 
the Endowment for the Arts for all of its citizens.
    That commitment, that investment, is in jeopardy right now. 
We have had, as you know, almost a 40-percent budget cut in the 
past 2 years, and this has resulted in fully 1,000 
organizations nationwide that in the past received NEA grants 
not being given one this year.
    The fallout from that is significant. They are not able to 
leverage the money in the private sector. The States are not 
able to make up the difference, nor are the local arts 
organizations, and on and on. There is a real domino effect 
that happens here.
    A lot of people say, well, the Endowment's investment 
monetarily is a very small portion of what happens with regard 
to the nonprofit arts and how they are funded in the United 
States. That is true. Most of the nonprofit arts in the United 
States are funded by individual citizens, but there comes a 
point when we must say, how much more can we ask of these 
citizens?

                     nea makes the arts accessible

    You brought up the Metropolitan Opera and the ticket prices 
of the opera are indeed very high. What the Endowment helps do 
is make that Metropolitan Opera accessible through broadcast--
and some of you may have seen on public television last night 
Andre Chernier was broadcast. The Endowment helped make that 
program possible so that people all across America could see 
that opera.
    Indeed, we continue to help support NPR in its broadcast of 
the Met on Saturday afternoons, which has been going on for 
ever and ever, and my own immigrant mother-in-law from Russia 
would never miss a Saturday broadcast of the opera, and there 
are many people who are unable to afford that $200 ticket who 
are able to have access to the Metropolitan Opera through the 
National Endowment for the Arts and other funders. The 
Endowment, again, plays that critical role of leveraging 
private funds.

                   private sector funding of the arts

    Let me talk for a minute about other than individual 
giving, which as I say makes up the bulk of giving to the 
nonprofit arts in the United States. Corporations have actually 
been declining in their giving to the arts. We think that we 
can encourage them to give more to the arts. Although they have 
increased nonprofit giving in general to the arts, it has 
remained fairly static. The same is true of the foundations, 
which say they cannot make up the difference.
    NEA continues to be the single largest donor to the 
nonprofit arts in the United States. We have been concerned 
with the fall-out in funding from the Federal Government, so we 
began an initiative last year called American Canvas, which 
seeks to encourage communities to build an arts infrastructure. 
We will feed them information with regard to models elsewhere 
that may be replicated in their community, and try to identify 
dedicated sources of revenue for the arts that may not have 
been tapped to date.
    Some people have said: ``Why doesn't the commercial 
entertainment industry come in and pay the cost of the 
nonprofit arts in America?'' First of all, I feel that that is 
a particular elitist view in that this is really an agency that 
belongs to all the people in America, and if you ask only the 
few very wealthy individuals some of our critics have been 
saying should fund it, you are actually becoming more elitist, 
I feel.
    Perhaps the corporate commercial popular entertainment 
sector could chip in more on that. We are working on that. It 
has not happened today, but I would like to point out that many 
individual celebrities do already give a great deal of money to 
the Federal Government in taxes. They also are supporting 
independently, through volunteering and philanthropy, arts 
organizations.

                      value of the arts to society

    But the NEA remains the agency that works well for all 
citizens. It is very difficult to quantify the value of arts to 
our society, but some of you may know, and have been hearing 
about, what the arts mean to early childhood development.
    There are evaluative studies that are going on now, and we 
will be seeing that the arts play more and more of a role in 
increasing brain power for not only our earliest, youngest 
citizens in society, but also for those who are elderly.
    New studies on Alzheimer's show we need to keep them 
thinking, keep them creative. The arts play a role there, and 
the NEA plays a role as well.
    Business knows the value of the arts. Business knows that 
they want the most creative thinkers right now going into 
business because things are changing so fast in the new 
technologies and in the world of communications in particular.
    As the wealthiest Nation on Earth, I have to say I continue 
to be mystified that the Federal Government of the United 
States does not invest more in the arts, in the future of its 
citizens. It is to my mind a win-win situation for everybody 
for the quality of life, for education of our young people and 
continuing education for our elderly, for economic development 
of communities, for creative thinking, for creative and 
critical thinking for all of our citizens, and for that 
amorphous thing we call the soul, which really cannot be 
quantified--inspiration.

               need for government investment in the arts

    The United States is wealthy in many, many ways, and 
certainly financially. It is wealthy in the variety and the 
beauty of its land. It is probably most wealthy in its human 
resources, in the variety and diverse peoples that make up the 
United States of America.
    Although we are very proud to be Americans, it is the mix 
of our backgrounds, our coming together, our very differences 
that keep us vital, that keep us alive, that make America 
great. It is the celebration of the different heritages of our 
cultural identities that keeps us thinking, that keeps life 
interesting and meaningful, and it is the arts that celebrate 
that part of ourselves.
    It is in fact embarrassing to me that our Government does 
not invest more in the arts, that it in fact seems to be 
retreating from the recognition of the value of the arts to our 
Nation and the enhancement of the arts which so define and 
express who we are.
    At this time in particular, which is the close of one 
century, the beginning of another--in fact, the beginning of a 
millennium, certainly a marker for us in the Western World--I 
feel we should be expanding our commitment to the arts and 
humanities as our fellow nations worldwide, the major nations, 
are.

                           prepared statement

    Not long ago one of your colleagues was visited by two pig 
farmers who were sitting in the reception area waiting to see 
the Senator and picked up some information about the National 
Endowment for the Arts, and when they went to see the Senator, 
the first thing they said was, ``We only give 38 cents per 
person to the arts in America at the Federal level?'' The 
Senator said: ``Yes, we do,'' and the pig farmers said: ``When 
we invest so little, how can we be the best?''
    Now, I think it takes a farmer to understand what an 
investment means, but if we do not invest today in this Federal 
commitment to the arts we are really robbing our children's 
future.
    Thank you very much. I will entertain any questions.
    [The statement follows:]

                  Prepared Statement of Jane Alexander

    Thank you Mr. Chairman and Members of the Interior 
Subcommittee. I appreciate the opportunity to testify today 
about the importance of the National Endowment for the Arts.
    Today, Mr. Chairman, our longstanding Federal commitment to 
supporting arts and culture for the American people stands at a 
crossroads. For thirty-two years, the National Endowment for 
the Arts has led the way in making art accessible to average 
Americans in every city, small town and rural area of the 
United States. Now the issue before you is clear--will the 
Federal government continue to be a partner in preserving the 
cultural heritage of this nation--will it continue to invest in 
the creative potential of its citizens, and future generations?
    Or will we be the only major nation on earth to deny a 
Federal role in our country's artistic endeavors?
    The $99.5 million contributed to the arts and culture each 
year by the Federal government through the National Endowment 
for the Arts is a relative pittance--less than one-one 
hundredth of one percent of the Federal budget--less than 38 
cents from each American. Yet its impact is felt throughout the 
land, and an overwhelming majority of Americans have repeatedly 
said they want it continued.
    Mr. Chairman, I understand that this committee and a 
healthy majority of the United States Senate supports Federal 
funding for the arts. As you know, however, there are a few who 
are extraordinarily adamant in their desire to eliminate the 
National Endowment. They have undertaken a relentless campaign 
against the agency. They are rehashing old arguments and they 
are dredging up even older controversies. Two weeks ago they 
used a $750 grant that had been awarded in 1968, almost thirty 
years ago, as the centerpiece of their attack on the NEA.
    They criticized us for a grant the agency awarded a few 
months ago to the California Indian Basket Weavers Association, 
as if this world-renowned form of traditional art mastered by 
Native Americans was somehow not worthy of support.
    You will hear many arguments in the coming months about 
whether funding for the arts should continue. As Chairman, I 
have made the agency more accountable in accomplishing its 
fundamental mission of connecting Americans everywhere to the 
best art. Last year, in response to a 39 percent cut in our 
budget, I reorganized the agency in order to operate more 
efficiently with a drastically reduced staff. I restructured 
the entire grant review process from top to bottom, limiting 
most organizations to only one grant and consolidating our 
support for state arts agencies and regional organizations into 
streamlined Partnership grants.
    Despite this hardship, we have awarded 1,029 grants in 
1997. Two weeks ago, we announced new grants totaling almost 
$67 million, drawing to a completion the agency's first funding 
cycle under the new structure. We made 494 grants to 
organizations totaling almost $23.5 million in the area of 
Creation & Presentation for a wide range of projects that 
include music and theater festivals, design workshops, 
composition and choreography commissions, nationwide dance 
tours, major museum exhibitions, and hundreds of other 
projects. They ranged from a $50,000 grant for the Anchorage 
Concert Association to support a series of dance residencies 
with the world-famous Paul Taylor Dance Company in Alaska to a 
grant for Monadnock Music in Peterborough, New Hampshire, to 
support eighteen free concerts in New Hampshire's rural towns 
and villages.
    In the area of Planning & Stabilization, 125 grants 
totaling almost $10.5 million will help many of America's arts 
organizations achieve greater financial stability. These 
projects address many needs, from raising earned income and 
endowments to conducting feasibility studies, or adapting 
technology to develop new audiences. For example, the 
Cumberland County Playhouse in Crossville, Tennessee, which 
already serves more than 100,000 rural citizens and visitors, 
will reach out even further with a new cultural tourism 
campaign. The Artist Trust of Seattle will receive $100,000 to 
support the establishment of a self-sustaining endowment. 
Thirty thousand dollars awarded to the Balboa Art Conservation 
Center in San Diego will go to improving the collections 
storage needs of small to mid-sized museums throughout 
California, Arizona, Washington and Oregon. Seventy-five 
thousand dollars will help the Santa Fe Chamber Music Festival 
establish a cash reserve.
    By statute, 35 percent of the Endowment's program dollars 
are awarded each year through Partnership grants to the state 
and regional arts organizations creating a strong interrelated 
Federal, state and local system of support for the arts in 
communities throughout the United States. Sixty-two Partnership 
grants totaling $30 million were awarded two weeks ago, as were 
forty Creative Writing Fellowships, one of the few types of 
support to individuals still offered by the Endowment.
    We supported fifteen Leadership collaborations with other 
public and private organizations. These are projects of 
national importance that would not happen without the Federal 
government's commitment of resources and leadership, and they 
include such initiatives as Creative Partnerships for 
Prevention, a youth program run with the Department of 
Education offering the arts and humanities as an alternative to 
drugs and violence. Another award will support the Fund for 
U.S. Artists at International Festivals and Exhibitions.
    One of our most successful Leadership Initiatives is the 
ongoing Mayors' Institute on City Design which is dedicated to 
improving the design and livability of America's cities. Each 
year, the Institute holds a series of two-and-one-half day 
symposiums organized around presentations and round-table 
discussions. At each meeting, mayors and designers discuss 
specific problems facing cities and examine a broad range of 
ideas, precedents, and improvement strategies. Each mayor 
presents a case study of a critical issue from his or her city, 
and members of the resource team--nationally known architects, 
planners, and urban development experts--identify issues, offer 
suggestions, and discuss solutions. The interchange between 
mayors and designers sparks lively debate, opens new 
perspectives, and generates creative ideas. Since its inception 
in 1986, more than 300 mayors have participated in the 
meetings.
    A few months ago, in December, we announced the first 
grants made under our other two funding categories, Heritage & 
Preservation and Education & Access. In the area of Heritage & 
Preservation we approved 121 grants totalling $6.1 million for 
projects to preserve America's significant and unique artistic 
accomplishments for the benefit of our future generations--
projects like the one sponsored by Cornerstones Community 
Foundation in Santa Fe, New Mexico, to help preserve the 
historic buildings native to the area, particularly the 
region's historic adobe churches.
    We supported important folk arts projects like the one 
sponsored by the Alabama Folklife Association to publish and 
document primitive Baptist hymns, and the one by the Cedarburg 
Corporation to help celebrate Wisconsin's sesquicentennial 
through a traveling exhibition of Wisconsin folk art. We 
supported statewide apprenticeship and support programs in West 
Virginia, Alaska, North Dakota, Hawaii and other states. We 
gave a grant to an organization in Falls Church, Virginia, that 
is using innovative technologies to safeguard and preserve our 
dance heritage. Finally, Mr. Chairman, we will continue to 
sponsor, as we have for many years, the annual Fourth of July 
concert and radio broadcast held on the grounds of the 
Washington Monument.
    Indeed, in December, we also awarded our first grants in 
the area of Education & Access, where priority is assigned 
specifically to arts education, and other projects that broaden 
the arts experience of millions of Americans. Many of the 
people who benefit from these grants have not always had the 
opportunity to participate in the enterprise of creating art or 
simply experiencing art as it is created by others, be it a 
night at the symphony, a children's festival, a concert in the 
park or a creative writing program.
    We awarded almost half of our Education & Access grants to 
performing arts organizations that are reaching out into their 
communities. The Chicago Theatre Group received $125,000 to 
support the Goodman Theater's student subscription series, 
giving many thousands of high school students the opportunity 
to attend free matinee performances. Similarly, the Houston 
Grand Opera will undertake a major audience development project 
with the help of a $200,000 NEA Education & Access grant, which 
they will match with one million additional dollars of their 
own. They are planning free performances of Carmen and Madame 
Butterfly, and will place young opera singers in the public 
school classrooms as artists-in-residence. They will reduce 
ticket prices and perform in over one hundred public schools in 
the region. Mr. Chairman and members of the Subcommittee, young 
Texans will have the opportunity to appreciate opera as they 
never have before.
    Through our Education & Access grants we are also 
continuing to support projects in many small towns like the 
Bloomsburg Theatre Ensemble's traveling educational project in 
Pennsylvania's elementary and middle schools, and West Liberty, 
Ohio's, Mad River Theater Works' development of a new play 
based on the local history of Champaign County. We are 
continuing to support Pittsburgh's Manchester Craftsmen's 
Guild, an exemplary inner-city community development center 
that uses the arts to provide young people with a safe haven 
and important job training skills. The corporate offices and 
laboratories of western Pennsylvania are filled with young, 
productive Americans who found their way in life with the help 
of strong mentors at the Manchester Craftsmen's Guild. If you 
are ever in Pittsburgh, you must visit the Guild. As a matter 
of fact, they are now the proud recipient of a Grammy Award for 
their first CD for Jazz at the Manchester Craftsmen's Guild.
    While I am confident that the Endowment has funded the best 
projects, I am disappointed that many excellent and extremely 
worthy projects were necessarily rejected due to the lack of 
adequate funding. Many applications submitted by some of 
America's finest arts institutions--large and small, in little 
towns and big cities--were necessarily rejected. That is the 
sad situation we face in our reduced funding state.
    And so, I am deeply concerned, Mr. Chairman, about the 
financial state of the nonprofit arts industry in the United 
States today. Grants from the Federal government are only part 
of a complex system of funding that includes ticket sales, 
program advertisements, corporate and foundation giving, gift 
shops, membership fees and other creative fundraising 
techniques. While earned income is a substantial part of any 
organization's budget, the cost of producing art for public 
consumption exceeds income for all but the most popular 
ventures. According to a study published last year by the 
President's Committee on the Arts and Humanities in conjunction 
with the Rockefeller Foundation, private and corporate 
foundations already give over $1 billion to the arts each year. 
They say they will not and they can not give more. In any case, 
corporate and foundation dollars are given locally, 
concentrating on the largest, most prestigious institutions, 
often in response to capital campaigns that include government 
support. Those dollars most often do not reach into small 
cities and rural areas. It is the Federal dollars that reach 
into those areas, and the Federal imprimatur which the NEA 
represents in the arts which attracts other monies.
    By government standards, the National Endowment for the 
Arts is a tiny agency. But it is also the largest single source 
of funding for the non-commercial arts in the country. It is 
the engine that drives other public and private investment in 
the arts, and it is not a drain on the economy by any standard 
of measurement.
    I agree with many Members of Congress and others who say 
that the commercial entertainment industry could do more to 
support the nonprofit arts. We are, after all, the incubator of 
artistic skills. Each year hundreds of directors, actors, set 
and costume designers, writers, producers, musicians and others 
who get their training and experience in the nonprofit sector 
make the jump to the big commercial entertainment companies. I 
have had some conversations with entertainment executives on 
this subject, but have not been particularly successful in 
persuading them to support the arts on a corporate level.
    In this respect, it is important to make a distinction 
between what the large entertainment companies do, and what 
individuals like Robert Redford, Steven Spielberg, and many, 
many others have contributed over the years. These individuals 
certainly have done their part in terms of contributing time 
and resources toward the furtherance of young artists and 
important art forms. And in this respect, I do not believe it 
is fair to criticize them or other influential individuals who 
come to Washington to advocate in behalf of Federal funding for 
the arts. They pay a considerable share of taxes like other 
citizens, and surely they have the right to advocate for the 
programs they care about.
    Mr. Chairman, as part of my effort to create a more 
holistic synergy between the arts and the communities in which 
they flourish, the Endowment in 1996 launched American Canvas, 
a year-long effort to bring together people from all walks of 
society to gain a better understanding of how the arts 
transform communities, and how they may be supported better. 
Funded almost entirely from private contributions, the 
Endowment convened forums in seven cities across the United 
States. Through these meetings, artists together with 
educators, businesspeople, clergy, elected officials, and many 
others worked together to develop new strategies for supporting 
the cultural infrastructure that every healthy community needs 
to have.
    The major objective of American Canvas, and the report we 
are working on now, is to give communities tools for 
understanding the value of their cultural attractions, and 
tools for preserving and enhancing those attractions. Mayors 
and other local leaders know culture has more to it than 
aesthetics. Culture makes cities livable and attractive. 
Cultural institutions can be the difference between winning or 
losing the competition for economic development.
    Mr. Chairman, I could go on about the many things we are 
working to accomplish, but I want to take a moment to consider 
some of the things that we are not able to do. Prior to 1996, 
the National Endowment for the Arts was averaging approximately 
4,000 grants each year. In fiscal 1996, a transition year in 
which we were cut by 39 percent, we made approximately 2,000 
grants under both the old and the new systems. In 1997, the 
first year in which new system was in place for the entire 
grant-making cycle, we expect to make about 1,100 grants. Many 
arts institutions that received grants in the past no longer 
do. And as you know, we are not permitted to make grants to 
individual artists at all, except in a few limited 
circumstances.
    Prior to 1996, the application-to-grant success ratio for 
organizations averaged about 60 percent. Today that ratio 
stands at about 35 percent, and there are many disappointed 
people as a result of it. In fact, they are quite skilled in 
making their displeasure known. They write to their elected 
representatives who write to me wanting to know why their 
constituents were rejected for funding. In many cases, I can 
only respond that we lack sufficient funds, and it is difficult 
to draw the line between projects that are all exemplary. We 
try to be as fair as we can.
    Finally, Mr. Chairman, I wish to assure you that President 
Clinton strongly supports the National Endowment for the Arts. 
The President's powerful and eloquent remarks about the arts 
and culture were unmistakable when he appeared before Congress 
in his State of the Union Address a few months ago. I would 
like to repeat his words today:
    The enduring worth of our nation lies in our shared values 
and our soaring spirit. So instead of cutting back on our 
modest efforts to support the arts and humanities, I believe we 
should stand by them and challenge our artists, musicians and 
writers--challenge our museums, libraries and theaters. We 
should challenge all Americans in the arts and humanities to 
join with their fellow citizens to make the year 2000 a 
national celebration of the American spirit in every community, 
a celebration of our common culture in the century that is past 
and in the new one to come in a new millennium so that we can 
remain the world's beacon not only of liberty but of creativity 
long after the fireworks have faded.
    Today, I am here to support the President's request of $136 
million for the programs of the National Endowment for the Arts 
in fiscal year 1998. We believe the increase in funding will 
permit us a modest increase in the work we are doing to support 
arts education projects, access and outreach to underserved 
communities, new technologies, the coming millennium 
celebration, and finally, the help we give to arts 
organizations in every part of the United States to preserve 
our heritage and invest in our future. The National Endowment 
for the Arts remains committed to bringing the most excellent 
art to the most Americans. Mr. Chairman and members of the 
subcommittee, I hope I can count on your support.
    Again, I am pleased to have this opportunity to speak with 
you.
                                ------                                


                 Biographical Sketch of Jane Alexander

    Jane Alexander was nominated by President Clinton to become 
the sixth Chairman of the National Endowment for the Arts in 
the summer of 1993. After unanimous confirmation by the U.S. 
Senate, she was sworn into office by Supreme Court Justice 
Sandra Day O'Connor on October 8, 1993.
    Since becoming Chairman, Ms. Alexander has visited more 
than 200 communities in all 50 states and Puerto Rico. In over 
300 public speeches, she has outlined her vision for the agency 
with thousands of people. She has met personally with Members 
of Congress, governors, mayors, state legislators, artists, 
administrators, and corporate, education and community leaders 
throughout the nation. Taking up the challenge of President 
Clinton to ``renew America,'' Chairman Alexander has spoken out 
about how the arts can contribute to better schools, more 
vibrant local economy, and stronger communities.
    As part of the Clinton Administration's efforts, she has 
strengthened some 30 partnerships with other Federal agencies. 
Under Chairman Alexander's leadership, the Arts Endowment began 
a partnership with the Department of Justice serving at-risk 
youth through the arts. The Endowment has also formed 
partnerships with the Department of Education for improved arts 
education research and development.
    Six months after taking office, Chairman Alexander convened 
the first national arts conference organized by the Federal 
government, ``Art 21: Art Reaches into the 21st Century.'' From 
this foundation, she has developed her priorities for investing 
in communities, education, new technology, preservation of our 
heritage, and partnerships for the arts. In 1996, the Endowment 
launched ``The American Canvas,'' a series of community forums 
to find systemic ways of supporting the arts. As part of the 
agency's efforts, Chairman Alexander established the Office of 
Enterprise Development to seek new ways to support the arts.
    In the face of Congressional budget cutbacks, she has 
successfully completed a total reorganization of the Arts 
Endowment, emphasizing partnerships and cross-disciplinary 
initiatives, including a category for Millennium Projects to 
celebrate American art at the turn of the century. Chairman 
Alexander has created new tools for public access to the 
agency, including the Arts Endowment's World Wide Web site, and 
she has initiated a $1 million leadership initiative with the 
Benton Foundation to increase opportunities for artists and 
small arts organizations to improve communications through the 
Internet.
    For her leadership, Ms. Alexander has received a number of 
honors, including the 1995 Montblanc de Culture North American 
Award, the Common Wealth Award, the Crystal Award and the Sara 
Lee Frontrunner Award for her bringing the arts to the American 
people. She is a much sought-after public speaker and has given 
commencement addresses at The Juilliard School, the UCLA School 
of the Arts, North Carolina School for the Arts, the University 
of Pennsylvania, Princeton University, Washington University of 
St. Louis, the New York High School for the Performing Arts, 
the College of Santa Fe, and Duke University.
    Ms. Alexander, a native of Brookline, Massachusetts, has 
been active in the arts for all of her adult life as an award-
winning actress, producer, and author. In addition to 
appearances in 40 films and television programs, she has 
performed in over 100 plays on stages across the country. Ms. 
Alexander received six Tony Award nominations, four Academy 
Award nominations, and five Emmy Award nominations, and she 
received a Tony Award for The Great White Hope and an Emmy 
Award for Playing for Time. She also received the Television 
Critics' Circle Award for her portrayal of Eleanor Roosevelt in 
Eleanor and Franklin: The White House Years.
    Ms. Alexander has produced three films, including the 
acclaimed A Marriage: Georgia O'Keeffe and Alfred Stieglitz for 
PBS's ``American Playhouse.'' She has narrated documentaries, 
short stories and books, and is co-author of an adaptation of 
Henrik Ibsen's The Master Builder and co-author of The Bluefish 
Cookbook.
    Prior to becoming Chairman, Ms. Alexander served as an 
effective and articulate advocate for a number of worthwhile 
causes, including Women's Action for New Directions, the 
Wildlife Conservation Society, and the National Stroke 
Association. In recognition of her leadership, she received the 
Living Legacy: Jehan Sadat Peace Award in 1988.
    Ms. Alexander attended Sarah Lawrence College and the 
University of Edinburgh. She was born on October 28, 1939 in 
Boston, the daughter of surgeon Thomas B. Quigley, one of the 
pioneers in the field of sports medicine and Ruth Pearson, a 
nurse in neurosurgery. Her grandfather Daniel Quigley was 
Buffalo Bill's personal physician in North Platte, Nebraska. 
Ms. Alexander is married to director Ed Sherin. Her son, Jace 
Alexander, is a stage and film director.

                            romanov exhibit

    Senator Gorton. Ms. Alexander, I would like to ask you a 
question about an incident related to the arts and/or the 
humanities that has been on the front pages of our newspapers 
here for the last 2 or 3 days. Through the Arts and Artifacts 
Indemnity Act, do you have anything to do with the large van 
that has been sitting out on the street here and is now at the 
Russian Embassy?
    Ms. Alexander. No; that is one controversy we will not take 
credit for. [Laughter.]
    We did not indemnify the Romanov exhibit.
    Senator Gorton. Well, I am sorry to hear that. I was 
looking forward to your comments on that one. [Laughter.]
    In spite of my opening remarks, there still is a debate 
continuing on the existence of the National Endowment for the 
Arts itself, as I said, primarily in the House of 
Representatives. Could you, for our information, and in 
reaching our decisions here in this Appropriations Committee, 
give us a status report on your discussions with Members of the 
House on this subject? Do you have any reason to believe that 
our counterpart in the House will include an appropriation for 
the National Endowment?

                status of nea appropriation in the house

    Ms. Alexander. We do not know the answer to that, although 
we are speaking with Chairman Regula fairly often. We do not 
know what he intends to do, or what the subcommittee intends to 
do with regard to appropriations. What we fear is a zero 
appropriation, and then that does not leave a lot of 
negotiating room for the Senate and for the administration.
    At $99.5 million, Mr. Chairman, we really cannot go lower, 
and in fact we are losing ground even if we were level-funded, 
because of cost-of-living increases and administrative costs. 
We have to make up the difference.
    Senator Gorton. When you are faced with arguments about 
elimination, do they stem in your view primarily because of 
criticism of particular grants, or primarily from the argument 
that this is not an appropriate role for the Federal Government 
whatever the grants are?
    Ms. Alexander. A little of both. I think that there are 
some of our critics who just feel that we have been funding a 
lot of controversial works, which, by the way, is not true, and 
others who simply do not think that it is an appropriate 
Federal role. I disagree with that, of course. I think it is 
the most appropriate Federal role.
    Senator Gorton. So you have to deal constantly with both of 
those arguments?
    Ms. Alexander. Yes, indeed.
    Senator Gorton. Now, it looks as though the sympathy you 
have in the Senate may very well result in at least the report 
of a reauthorization bill from the Senate Labor and Human 
Resources Committee. Can you comment on that? Are you looking 
for any significant changes in your authorization here?

                     status of nea reauthorization

    Ms. Alexander. I do have a hearing before the Senate Labor 
and Human Resources Committee next week with regard to 
reauthorization. We do not know exactly what that means yet. We 
will be looking for a 5-year reauthorization of the agency, 
which has not been reauthorized since 1993.
    Senator Gorton. Would you be relatively content just to 
have a 5-year reauthorization based on the present statute?
    Ms. Alexander. That is correct.

                  possible consolidation of endowments

    Senator Gorton. On another subject that you have discussed 
before, I would like your current remarks. It is the proposal 
to consolidate the two Endowments. Would you share with us your 
views on it? Are there any pluses that it might have from an 
administrative standpoint, or obstacles that might be 
encountered due to inconsistency with different goals?
    Ms. Alexander. Yes; I would be glad to. We did explore a 
merging of the two agencies at Congress' request 2 years ago, 
and we continue to look at how we might merge the 
administrative functions, but right now we are pretty bottom 
line, both of us, and there would be no cost savings in merging 
the two agencies.
    We share as much as we can already, and we share library 
space and some of the staff and so on, but we do not see any 
savings to the Federal Government emerging at this time.

                         reorganization of nea

    Senator Gorton. One more subject and then I am going to 
defer to my colleagues. During last year's hearing you had just 
reorganized the agency from 17 different disciplines into four 
broad categories. Can you tell us now how this is working, and 
whether or not you are satisfied with the change?
    Ms. Alexander. Yes; our four categories seem to be working 
very well. It was a hard learning curve for our arts 
organizations this year because they were restricted 
legislatively from applying for seasonal support and had to 
apply for project support only, and they had a very short time 
line in which to accomplish this.
    We feel that this coming year will be easier for everybody, 
that they know the process somewhat. Our staff, which as you 
know I had to reduce by about 45 percent, is now understanding 
the process better as well, and they are spending more time 
than ever on the phone with the constituents across the 
country.

                    application and grant statistics

    Senator Gorton. Is it going to mean, or has it meant an 
increase or a decrease in the number of applications and the 
number of applicants?
    Ms. Alexander. Yes; we sought a decrease in the number of 
applications, asking organizations only to apply for one 
category, one grant.
    Senator Gorton. Decrease in the number of applications? Is 
there a decrease in the number of applicants?
    Ms. Alexander. Applicants? Yes, indeed. Well, the bulk of 
them came when there was a prohibition against funding 
individual artists, with the exception of literature. We 
reduced our applicants by about 9,000 right there, and we now 
have applications from about 3,000, and we funded 1,000.

                      nea partnerships with states

    Senator Gorton. As part of that new program structure State 
grants were consolidated into State partnerships. Has that 
created a favorable response from State arts agencies?
    Ms. Alexander. Yes; I think so. We are very pleased with 
our partnership meetings with the States. We already had a real 
partnership with the States, but what we wanted to do was look 
at the States State-by-State, if you will. So now every 2 years 
we bring in a State in a small colloquy of about five to six 
other States and we discuss our mutual problems with regards to 
serving the arts constituency in that State. It seems to be 
working very well.
    Senator Gorton. Good. At this point, while I have more 
questions, I think I will defer to my colleagues, who may or 
may not have as much time as I have.
    Senator Bumpers, have you any questions?
    Senator Bumpers. Mr. Chairman, I do not have any questions.
    Ms. Alexander, I would like to echo Senator Cochran's 
words. I think you have done an excellent job under very 
difficult circumstances, Ms. Alexander.
    Ms. Alexander. Thank you.
    Senator Bumpers. You have my undying gratitude, and I am 
sure I do not just speak for myself but many others.
    Ms. Alexander. Thank you, Senator.
    Senator Gorton. Thank you, Senator.
    Senator Campbell.
    Senator Campbell. I was just musing about the arts here 
while listening to Ms. Alexander, Mr. Chairman. I used to teach 
art. I was involved in it pretty deeply for years and years, as 
you probably know, and I have a friend in Washington here, a 
lady, who is awful. She paints, and she showed me a picture the 
other day, a portrait of the late Rock Hudson that looked 
suspiciously like Quasimodo. [Laughter.]
    But you know, I do not have to like the result to support 
the effort, and I am convinced that with enough training and 
effort, that her future portraits of Rock Hudson will look at 
least like John Wayne. She is getting better. [Laughter.]
    I want also to associate myself with the comments of 
Senator Bumpers when he talked about prisons. I think you 
mentioned $26,000 a year.
    Senator Bumpers. No; $24,000.

                importance of the arts in penal systems

    Senator Campbell. $24,000 a year is spent to house convicts 
in prison. I understand also it is about $1 million a cell to 
build them, and they are going up at about twice the rate of 
our college population. If you were to graph it, not in total 
numbers, but if you were to graph the last 10 years there are 
one-half million more new convicts, and I am very well aware of 
what you are talking about, since I was once a counselor, a 
volunteer counselor in Folsom Penitentiary in California, 
Senator Boxer's State.
    But I just wanted to mention that prisons have seen a great 
number of people who have gotten involved in the arts when they 
were in prison. Almost every Federal penitentiary that I know 
of now has a prison art show every year. They have a store, a 
craft store where prisoners can sell their arts and crafts, and 
it gives them an opportunity to raise a little bit of extra 
money from doing laundry, making license plates, or whatever 
else they do in prisons.
    When I was at Folsom, a couple of times I judged the Folsom 
Prison art show. I was amazed at some of the talent that they 
have, and obviously they have some talents that went the wrong 
way or I guess obviously they would not be in there, but I was 
amazed at that.
    And when I was a counselor I was also working in a half-way 
house that helps get convicts back into the mainstream, get 
them jobs to stay out of trouble, and a number of them that got 
out of prison those years I was doing that ended up making a 
living in arts, being painters or jewelers or something, so I 
know there is a connection there.
    Senator Bumpers. Senator Campbell, would you yield for just 
a little personal vignette?
    Senator Campbell. Yes, sir.
    Senator Bumpers. I was Governor of Arkansas in 1972, and 
Betty Bumpers, who was an art major, got a $50,000 grant from 
Nancy Hanks, who was then head of the National Endowment for 
the Arts, and the $50,000 was to do some pilot programs of 
teaching art in the first grade of the elementary schools. I do 
not know, it was maybe 20 schools, or 30 or more, and she had a 
little money left over. She took it down to Cummings Prison and 
did a little art program down there, and those inmates flocked 
in to participate in that. Betty said it was absolutely 
remarkable how talented some of those people were.
    The point of the story being, if there had been early 
intervention in the form of finding that talent among those 
children, they would have been challenged in the first grade 
and had a chance to demonstrate their art. They would not have 
been there.
    Senator Campbell. The reason I made that comment is because 
I know that every questionable grant the NEA gives gets a 
heated debate started, as you might imagine. I do not know if 
you are giving any for prisoners or not, but if you give any 
for prisoners we are going to start getting mail on that.
    I think as Senator Bumpers said there is some real value in 
arts for people who are incarcerated. It has been proven many 
times. People in hospitals who have psychotic problems, even, 
the arts help, so it is a much broader issue than we normally 
view here.

              economic consequences of agency elimination

    I just wanted to ask you maybe a couple of questions. You 
mentioned the economics of the arts, but I was trying to put a 
dollar figure on that. Do you have any guesstimates about if 
the funding of the NEA were cut off what would the economic 
consequences be, because you mentioned corporate money is 
drying up, State money, they are reluctant to give any money if 
we do not help out with grants and things of that nature, but 
do you have a dollar figure?
    Ms. Alexander. It is hard to quantify because there are 
always so many partners that go into funding the nonprofit 
arts. Some of the studies that have been done independently in 
places like New York and New Jersey, show that the impact on 
the metropolitan area from the arts at large, including the 
commercial sector, is absolutely enormous--billions of dollars.
    It is very hard to be able to say what it would mean. All I 
can tell you is that we reach people through the public sector 
that are not covered by the private sector, such as your 
eloquent testimony with regard to the basket-makers. What 
corporate sponsor is going to pick up the California Indian 
Basket-Makers Association?
    So I think it would amount to billions of dollars, but I 
have no way of actually knowing.

                  geographic distribution of nea money

    Senator Campbell. Another thing I am interested in is, we 
hear there is something like 50 percent of all of the grants go 
to just a couple of States. New York is an example, a lot to 
the District of Columbia also, and the further away it gets 
from the east coast, particularly in the rural areas and poorer 
areas, the less they get. How does the National Endowment for 
the Arts respond to the needs of those rural, kind of out-of-
the-way places? I know that they have in this case, but let us 
say, Appalachia or somewhere else.
    Ms. Alexander. Well, I am very glad that you brought that 
up, because in fact although we do give a lot of money to New 
York, of course we get the bulk of our applications from New 
York and California, the two main talent pools, if you will, 
for almost all the arts, everything from design to music, and 
so on.
    But as I pointed out with the Metropolitan Opera and the 
broadcasts, what we try to do is facilitate through our New 
York grantees national impact, and there are many, from 
broadcasts on NPR and PBS to the Paul Taylor Dance Co., which 
tours the country, to Alliance for Young Artists and Writers 
that tours the country, and so on.
    So our New York grantees, we must keep in mind, are not 
just going to stay in New York for the most part. They are 
going to tour. Their impact also serves the tourists that come 
from out of town to New York.
    We reach rural areas to the very best of our ability, and 
we were very pleased in our latest grant round that fully 25 
percent of our grants went to organizations with budgets under 
$250,000, so that means we are reaching the small arts 
organizations, the ones that may be in Telluride or small 
communities everywhere.

                     nea programs for at-risk youth

    I would like to bring your attention, since you were 
talking about prevention and what the arts can do for those who 
are incarcerated or have other problems. This is one of our 
newest publications, called Art Works--you may have it in front 
of you--Prevention Programs for Youth and Communities.
    One of the most outstanding organizations in New Orleans, 
called Young Artists, Young Aspirations, began as a visual arts 
program for kids after school at a visual arts gallery called 
Ya-Ya in New Orleans.
    To make a long story short, last year they received a very 
fine commission to create the fabric for the United Nations, 
and this is a copy of some of the slipcover fabric that they 
created for the chairs in the United Nations. These young 
people all have careers now in the arts, and they began with 
after-school programs for kids who were kind of hanging around.
    Senator Campbell. And they got part of their initial 
funding through the National Endowment for the Arts?
    Ms. Alexander. Through the National Endowment for the Arts, 
correct.
    Senator Campbell. That is a good graphic illustration.
    Thank you, Mr. Chairman.
    Senator Gorton. Thank you. Senator Cochran.
    Senator Cochran. Mr. Chairman, I noticed in Ms. Alexander's 
statement the reference to the Creative Partnerships for 
Prevention Program, a youth program run with the Department of 
Education offering the arts and the humanities as an 
alternative to drugs and violence.
    I wonder, this collaboration with other organizations like 
this, is this something that you have had an opportunity to 
judge in terms of whether there are success stories, or has it 
just been started? Do you know any of the results that you 
could pass on to the committee?
    Ms. Alexander. The evaluative studies about the importance 
of arts in helping our young people in particular are ongoing 
currently, and one of the partnerships that we have with the 
Department of Justice is just that.
    It is an evaluative study to understand quantifiably what 
the arts do for young people, and to follow them after these 
programs. I think that is very important for us to begin to 
know whether they are going to sustain the arts in their life, 
whether it impacts their thinking about how they relate to 
society, and so on.
    So that is one of the partnerships we have going with the 
Department of Justice in this regard.

                            american canvas

    Senator Cochran. Another new initiative that I noticed in 
your statement was the American Canvas, where you are working 
with local communities to identify cultural assets and how they 
can be used to enrich the lives of the citizens there and be 
contributors to the economic progress of those communities.
    Tell us how that is working. Are there any anecdotal items 
of evidence that you can pass along for our hearing record?
    Ms. Alexander. Senator, we went into six cities. We went 
into Charlotte, NC, and Rock Hill, SC, which was one visit. 
Rock Hill, SC, is a very small area that has revitalized itself 
through the arts, and Charlotte, NC, of course, is a pretty 
large city now, and it has totally transformed itself with a 
great deal of money going into the arts in their community.
    We visited Salt Lake City, we visited Los Angeles, we 
visited San Antonio, TX, we visited Columbus, OH, and we 
visited Miami as well, and we held day-long or 2-day forums 
about the value of the arts to their communities and how they 
intended to sustain them for the future. We are concerned that 
there is not a solid infrastructure for the arts in the United 
States, as there is, and growing, for our natural resources.
    We do fund our parks and almost every city funds parks and 
recreation, but there is not a dedicated source of revenue in a 
community--in all communities for our cultural resources--so 
that is what we were trying to build and to discuss and to 
explore. We will have a report out, our American Canvas report, 
and also an action plan for communities everywhere, sometime in 
June.
    Senator Cochran. Thank you very much. Thank you, Mr. 
Chairman.
    Senator Gorton. Thank you. Senator Bennett.
    Senator Bennett. Thank you, Mr. Chairman. I recognize the 
special session or executive session is convening and, 
therefore, I need to be brief but I did want to welcome Ms. 
Alexander to the committee and to thank her publicly for coming 
to Salt Lake City. She made a big hit there, as she always does 
wherever she goes, and I want to thank her for her general 
leadership in this area as a whole.
    I do also want to wish Sheldon Hackney well in his new 
activities as he moves on, and have the unfortunate 
responsibility of commenting that the director of the 
Humanities Council in the State of Utah, Delmond Oswald, 
unexpectedly and tragically died recently, which leaves for us 
in Utah a fairly significant hole in our leadership.
    But we are trying to do what we can to see to it that we 
continue the tradition that goes all the way back to Brigham 
Young and the founders of the State of appropriate public 
support for the arts and humanities. I will do what I can at 
the Federal level to see that the appropriate support is 
continued.
    With that, Mr. Chairman, I suppose we all want to be off to 
find out more about chemical weapons. Maybe we already know 
enough, but that is where I am going to have to go.
    Senator Gorton. Thank you. Senator Gregg.
    Senator Gregg. I will associate myself with the comments of 
the Senator from Utah, which I think are very appropriate, and 
allow us to adjourn.
    Senator Gorton. Oh, we are not going to adjourn. You can 
leave if you wish, but we do have quite a bit more to go.
    Senator Gregg. Well, in that case I could take the next 
hour and give you my thoughts on this subject. [Laughter.]
    Let me just say that I do believe that Government funding 
for the arts and humanities makes sense. As Governor, I 
actually increased funding for those programs during a time of 
serious recession, because I felt it had a positive effect on 
the culture of the State, and I believe it has a positive 
effect on the culture of the country.
    We all recognize that the NEA funding has been 
controversial. Art is by nature controversial. I do think the 
leadership of the NEA has tried to be sensitive to the fact 
that these are tax dollars and should be managed effectively, 
and should be managed with some sensitivity to the fact that 
you are dealing with tax dollars and not with private money. 
Thus, aggressiveness which can be used in funding has to be 
muted to some degree, but I think on balance these 
organizations have done a good job, and I believe they deserve 
our support.
    I will pass on questions.
    Senator Gorton. One more comment, Ms. Alexander. I 
commented on the attendance here today. It has now increased. 
My roster indicates that 10 of the 17 members of the 
subcommittee have attended.
    I have a note here from Senator Domenici asking me to 
apologize for his absence. He is chairing the other 
subcommittee on appropriations that is meeting right now that 
so many of us, myself included, are members of, and of course I 
cannot avoid that. Many of the Democrats, as Senator Boxer 
said, are at the White House to discuss the budget.

                       states support of the arts

    But you have had a very impressive turnout here, and I have 
quite a number more questions, but most of them will be 
submitted to you in writing. I would like you for the record to 
indicate the overall level of public support for the arts in 
the United States. Do you know approximately how much State 
appropriations are for the purpose, and how much local 
government contributes to the arts, so that we have an overall 
long-term picture?
    Ms. Alexander. I do have those figures, but they are not 
right at my fingertips.
    Senator Gorton. Well, let me read my notes to see if they 
are accurate. My notes are just over $265 million through State 
art agencies in 1995, and an estimate of around $650 million 
from local government allocations. Does that comport with your 
figures?
    Ms. Alexander. Yes; that is correct.
    Senator Gorton. Have these been constant, or have they been 
going up?
    Ms. Alexander. It is State by State. The State 
appropriations actually have gone up in the last few years, but 
they are still not where they were in 1990. As for locals, I do 
not know the answer to that.
    Senator Gorton. Now, is it your view that much of the State 
and local support is engendered by the fact that there is an 
NEA, that there is an overall national leader? What role do you 
play in this process?
    Ms. Alexander. Senator, I do not think that State 
appropriations are specifically tied to the National Endowment 
for the Arts, but what I want to stress is that this is a 
partnership that works, that really, really works. We are able 
together to leverage even more resources than we could do 
separately. We are proud of our partnership with the States. We 
feel it is important to continue, and that we play a very 
important role for them.

                        chairman's action grants

    Senator Gorton. Under the law, the authorization, 10 
percent of funds can be awarded by the Chairman without any 
prior review, just simply on your own. Do you do any of that?
    Ms. Alexander. Very, very rarely. Very rarely, and as a 
matter of fact this year maybe I have made two or three 
independent grants.
    Senator Gorton. What would be the circumstances for that 
decision?
    Ms. Alexander. Where somebody was in real danger of having 
some real problems with a project, not controversial problems, 
but that just needed a little boost for something that was 
very, very important, for an organization that we really 
believed in, that somehow missed the deadline or something like 
that.
    It is so rare, and this year because of our decline in our 
program funds, I am not going to do it at all.

                 nea support of american artists abroad

    Senator Gorton. On another subject, has NEA played any role 
in supporting an American artistic presence abroad?
    Ms. Alexander. We do play a role. To my chagrin it is 
paltry compared to the other nations, who import a lot of our 
artists. When I meet with fellow ministers of culture or 
Ambassadors it is clear that we are not doing enough in this 
regard.
    As the Greek Cultural Minister said to me only a few weeks 
ago, he said, ``Thessalonike is the cultural capital of Europe 
this year, and they are having a long summer arts festival, and 
the United States is severely underrepresented,'' and asked 
what could I do about it, and I had to reply that there was 
really very little I could do about it.
    But we do maintain some of our international programs. Our 
international program is an $800,000 program, and it is hardly 
enough to send our major artists abroad.

                         income recovery policy

    Senator Gorton. Finally, the National Endowment for the 
Humanities has an income recovery policy from particularly 
successful projects. Does NEA have anything comparable?
    Ms. Alexander. We have the ability to recover some funds, 
but I would like to point out that the individual artists that 
we funded in the past, which is where one might garner money 
for the future when they become successful, most of them remain 
in the nonprofit art world and they do not make a lot of money.
    I mean, a Pulitzer Prize winner does not necessarily 
translate into a big marketplace book that is going to be a 
windfall for that individual writer for the rest of his or her 
life, although the NEA has funded a great many fellowships that 
then go on to be Pulitzer Prize winners, book or prize winners 
and so on.
    With regard to organizations, for example, an organization 
like the Public Theater in New York, which has a current hit in 
``Bring in Da Noise, Bring in Da Funk'' on Broadway, a very 
successful musical, or in the past had a megahit in ``Chorus 
Line,'' that money is plowed back right into the nonprofit 
organization, and just creates more opportunity for people to 
have theater for everybody, so we do not think it would be 
particularly an effective mechanism.
    Senator Gorton. Ms. Alexander, as always you have spoken 
eloquently on behalf of your Endowment. We appreciate it, and 
we will certainly be calling on you as we attempt to determine 
what we can come up with and how it ought to be divided up.
    Ms. Alexander. Thank you very much, Mr. Chairman and 
members of the committee.

                     Additional Committee Questions

    Senator Gorton. Thank you very much. There will be some 
additional questions which will be submitted for your response 
in the record.
    [The following questions were not asked at the hearing, but 
were submitted to the Endowment for response subsequent to the 
hearing:]

                     Additional Committee Questions

                             agency mission
    Question. Since its founding, NEA has played a major role in the 
decentralization of the arts. State arts agencies and local arts 
councils have been established in all fifty states and the arts have 
been made available to a much broader constituency throughout the 
country.
    Has NEA's success in making the arts more accessible to all 
Americans resulted in redefining the role of the federal endowment vis-
a-vis the states? Does an established state network of arts agencies 
bring with it a different set of requirements that are sought from the 
national endowment than were needed as the network was being created?
    Answer. The Arts Endowment and state arts agencies have long played 
critical and often complementary roles in making the arts more 
accessible. For example: state arts agencies often assist in the 
development of emerging local groups that later receive Endowment 
support for projects of regional, national or major field significance; 
state arts agencies often assist community groups that present touring 
events created with Endowment assistance; and state arts agencies 
provide the link between the Endowment's arts education initiatives and 
the classrooms or community venues in which they come to fruition. 
Progress in making the arts more accessible has not--in itself--changed 
the role of the Arts Endowment in relation to the states. However, a 
partnership between state arts agencies and a strong national arts 
agency continues to be essential to the goal of making the best art 
available to the greatest number of people.
    It has been many years since the network of state arts agencies 
required the kind of ``hands on'' technical assistance that was needed 
as these agencies were being created in the late 1960's and early 
1970's. However, in other respects there has not been much change with 
regard to what these agencies require of their federal partner. Even 
though aggregate state arts appropriations have grown, the federal 
dollars are still critical. For seven agencies, the Endowment's support 
still exceeds the amount of the state appropriation, and for thirteen, 
the federal support amounts to more than a third of their budget. Even 
for states with large appropriations, the federal funding provides much 
needed flexibility. While state arts agencies look to the Endowment for 
national leadership in arts education and other areas, the two now 
operate as true partners. Many state arts agency directors and 
commissioners have stated that without the example and incentive 
provided by the Arts Endowment, some agencies would lose their state 
support, and the working network of state arts agencies would be 
greatly weakened or cease to exist.
    Question. Has the agency's mission, or the execution of it, changed 
over the years? If you had the opportunity to redefine the NEA's 
mission, are there ways in which you would change it? Or do you believe 
that mandate under which you've operated over the years remains 
relevant?
    Answer. The mission of the National Endowment for the Arts is to 
foster the excellence, diversity, and vitality of the arts in the 
United States, and to help broaden public access to the arts. 
Throughout our 32-year history, beneficiaries of our mission have been 
the participants, audiences, and communities who are provided access to 
the best contemporary and traditional American art and opportunities 
for lifelong learning in and through the arts. Our service, while 
focused primarily on grantmaking, also includes leadership activities 
such as technical assistance, research and dissemination of information 
on the arts of national importance, and providing a forum for 
addressing national and regional issues in the arts.
    The National Endowment for the Arts is unique in that it is the 
only federal agency established expressly to nurture and support arts 
and artists of the highest quality. Further, in establishing the 
Endowment, Congress declared that ``the arts and the humanities belong 
to all the people of the United States,'' and the Arts Endowment was 
founded to help ensure that all Americans indeed had access to artistic 
activity of excellence and merit. In meeting this charge, not only have 
Endowment grants reached into all 50 states, but the agency supports 
projects having the potential to serve the entire nation. Through its 
programs, the Endowment has helped support the arts and cultural 
activities of the more than 170 different ethnic groups that live in 
every corner of the United States.
    The Endowment serves as a catalyst, the national identifier of 
artistic excellence and merit, and the leader in helping arts 
organizations and regional, state, and local arts agencies obtain 
access to potential governmental partners. For example, without the 
Endowment, federal programming in literature with national 
organizations such as the YMCA and the American Library Association 
would cease. Identifying and funding programs which help assure 
accessibility to arts activities for disabled people across the country 
would suffer. Leadership in convening over 100 representatives in the 
arts, education, business, and other sectors toward achieving a 
national strategy to implement locally arts education standards as a 
part of Goals 2000 would be missing.
    The Endowment also helps leverage private funding for the arts. 
Grants from the Arts Endowment require recipient organizations to match 
their awards 1:1 or 3:1, depending upon the program. The credibility of 
the Endowment as the national identifier of artistic excellence and 
merit has proven to be an important tool for grantees.
    Public arts funding at the state and local levels does not bring 
the national leadership and leveraging capability that results in 
partnerships and collaborations with the Endowment. Further, a 1994 
survey revealed the central role of the Endowment in building a 
national infrastructure of support for American folk and traditional 
arts, and in leveraging an increasing annual level of private and local 
support for traditional American art.
    The Endowment provides national coordination to the Federal/state/
local partnership. Prior to the inception of the Endowment, only five 
state arts councils existed. The Endowment helped create arts agencies 
in all 50 states and the six special jurisdictions, and subsequently 
nurtured the federal/state/local infrastructure in support of the arts. 
Fully one-third of the Endowment's budget goes to these state arts 
councils, but only after careful review by a national level panel of 
their annual plans for programs supporting the arts in their 
communities. This enhances the effectiveness of inter-and intra-state 
programs.
    Additionally, it is the leadership provided by the Endowment that 
helps sustain the country's artistic and cultural heritage by 
supporting traditional and contemporary art forms often not funded or 
underfunded at the state or local level or by the private sector. For 
instance, only six of the 56 state and jurisdictional arts councils 
have dedicated programs and staff in literature. Independent literary 
publishers exist in a specific community, but their audience is 
national. And certain art forms, such as design, are not funded by most 
states (in the case of design, 75 percent of state agencies have no 
such funding category). Touring across state lines in art forms such as 
dance occurs because of the Endowment's leadership, and its involvement 
further assures that the touring reaches small and rural communities. 
Because its perspective is national, the Endowment is positioned to 
identify and serve traditionally underserved (geographically isolated 
rural, inner-city poor, and certain ethnic) populations as well as 
senior citizens, disabled people, and people living in institutions. 
Its leadership in such areas has instilled awareness and responsiveness 
to these populations at the state and local levels and in the private 
sector.
    As demonstrated through the examples given above, the mission under 
which the agency has operated continues to be relevant because the 
country continues to change--demographically, economically, culturally, 
socially, aesthetically--and, using its national vantage point and 
federal authority, the Endowment is able to respond to the changes to 
ensure that American art flourishes and benefits the American public. A 
review of the mission in 1994 reaffirmed the dynamic application of its 
principles. The Endowment's mission is never finished; rather, it is 
woven into the fabric of American life.
                   fiscal year 1998 budget priorities
    Question. $136 million has been requested by the President for NEA 
activities in fiscal year 1998. However, it is doubtful that the 
Subcommittee will be able to provide the agency with an increase over 
their fiscal year 1997 budget. If this is the case, would you advocate 
that the appropriation of funds remain the same for the various budget 
lines of direct grants, state partnerships, and administration? Or do 
you see a need to allocate the resources differently and, if so, how 
and for what reasons?
    Answer. If the Senate Subcommittee is unable to provide the Arts 
Endowment with any increase for fiscal year 1998 over its fiscal year 
1997 budget, minor adjustments would be needed in the allocation of 
funds among direct grants, state partnerships, and administration.
    We would ask that the funds for the Policy, Research, and 
Technology office (OPRT), currently counted against the administrative 
account, be returned to the direct grants account. Funds expended by 
OPRT are solely for grants and/or cooperative agreements, primarily for 
the Endowment's research activities, not for its staff or other 
administrative costs. These research activities are authorized against 
the Endowment's programmatic budget, not its administrative budget, and 
until about 12 years ago were not counted as administration. However, 
in the mid-to-late 70's and 80's, the Endowment supported 6-12 
``Regional Representatives,'' in different parts of the country, whose 
role was to serve as two-way communications links between their regions 
and the Endowment. The funds for these ``Reps'' were carried as part of 
the-then called Policy, Planning, and Research Office (now OPRT). 
Feeling that Regional Representative costs were closer to 
administrative (``quasi-staff'') than programmatic, the Congress in 
fiscal year 1985 moved that account to administration. But the Regional 
Representatives program ended in fiscal year 1992. Thus, the reason for 
OPRT's being counted against administration ceased to be, and its 
current activities are covered by a program, not administrative, 
portion of our legislation [Section 954(c)(10)]. We would ask, 
therefore, that these activities once again be considered part of our 
direct grants account.
    In addition, we would need a very modest amount to cover increases 
in uncontrollable costs (e.g., Congressionally-mandated pay increases, 
GSA-decided rent increases, GPO-decided printing increases). If there 
were no increase in the Endowment's total budget, there would need to 
be small decreases in its other accounts as necessary to balance the 
required increase in the administrative account.
                    arts and artifacts indemnity act
    Question. NEA administers the Arts and Artifacts Indemnity Act for 
the purpose of minimizing the costs of insuring international 
exhibitions. Eligibility under the program includes loans from abroad 
on exhibit in the U.S. and U.S. exhibitions travelling abroad. 
Eligibility was expanded recently to include domestic loans on exhibit 
here in the U.S. when they are part of an exhibition from abroad.
    Over the last few years, there has been some discussion of 
expanding the Arts and Artifacts Indemnity Act to include general 
coverage of domestic exhibitions. The Federal Council on the Arts and 
Humanities has been unanimously opposed to this suggestion. However, 
the President's Committee for the Arts and Humanities urges the 
exploration of legislation to adopt this expanded language. Can you 
provide the subcommittee with some insight as to the difference in 
viewpoints between the two groups?
    Answer. The authors of ``Creative America,'' the President's 
Committee on the Arts and Humanities report, did not solicit our view 
or discuss with the members of the Federal Council their recommendation 
to explore legislation for a domestic version of the Arts and Artifacts 
Indemnity Act prior to printing the report. First, we would have 
corrected the error in the report which states that a new domestic 
version of the legislation ``could also indemnify works of art and 
other artifacts from American museums for exhibition abroad.'' In fact, 
the current indemnity law permits this coverage.
    More importantly, we would have cited our previous study of this 
issue and our day-to-day experience with the Indemnity Program, which 
reveals that a domestic version of the Act is neither desirable nor 
necessary. One of the principal reasons that the Federal Council 
members are opposed to domestic indemnity is that the risks to the U.S. 
Treasury would increase dramatically if exhibitions consisting solely 
of U.S. loans were eligible for coverage. The number of eligible 
exhibitions would greatly increase, thus exposing the Treasury to 
significantly higher dollar amounts. And, the more exhibitions in 
circulation, the greater the chance for claims for loss or damage. When 
the Association of Art Museum Directors membership was polled on this 
matter in 1989, they reported more than 50 claims per year from an 
average of 579 domestic exhibitions insured privately. In the history 
of the U.S. Government's Indemnity Program, which is limited to 
coverage of international exhibitions, there have been only two (2) 
claims paid in 22 years. The total number of exhibitions indemnified 
since 1975 is 533.
    Implementation of a domestic indemnity program would require a much 
higher authorized ceiling than the present level of $3 billion. We 
estimate at least $6 billion would be necessary to accommodate domestic 
exhibitions. It would also be necessary to appropriate monies from 
which to pay claims. Currently, there is a set aside of $275,000 from 
which to pay certified claims if they do not exceed $100,000. To pay 
the increased numbers of claims for loss and damage which would occur 
if domestic exhibitions were indemnified, an appropriation of perhaps 
as much as $1,000,000 annually would be necessary. And, the 
administrative costs of staff and panel review would be considerably 
higher than the current annual expenditure of approximately $75,000. A 
possible benefit to the American public might be the opportunity to see 
more exhibitions of arts from American collections. However, the AAMD 
study showed that the costs of insuring such exhibitions privately is 
not prohibitive and is therefore not a deterrent to organizing 
exhibitions.
    While the Federal Council members believe that the adverse impact 
on the budget alone is sufficient cause to reject a domestic indemnity 
program, we would further question whether it is the proper role of the 
federal government to displace the private insurance companies which 
provide this coverage now to American museums.
    The Federal Council was pleased to amend the Indemnity Program 
Regulations in September 1995 to expand coverage to include U.S.-owned 
loans when they are part of international exhibitions. Applications 
have been received under three deadlines, and at the last, 5 out of 16 
applicants requested coverage for both foreign and U.S.-owned loans. 
The Council believes that this new provision is an acceptable increase 
in risk to the Treasury which provides additional assistance to 
American museums and thereby benefits the museum-going American public.
    Question. Last year, NEA provided an estimate to the subcommittee 
that it would require as many as 10 additional staff to operate an 
expanded indemnity program, where anticipated applications would be 
expected to number between 500 and 600. Currently one staff member has 
responsibility for processing 40-50 applications annually. Would it be 
correct to assume that even if you were given authority to operate a 
broader program, current budget restrictions on staffing would not make 
it feasible in practice?
    Answer. Yes, the estimate for the need of 10 additional staff to 
properly conduct an expanded indemnity program still holds. This 
additional staff would greatly add to the cost of the program.
                the arts and rural communities agreement
    Question. The Art and Rural Communities Assistance Agreement is an 
interagency partnership between NEA and the Forest Service to support 
arts-based community development projects. What role does the Forest 
Service play in this partnership? What, if any, is their financial 
contribution? Does NEA operate the program or does the Forest Service? 
What have been the results of this program to date?
    Answer. The Endowment transferred $300,000 to the Forest Service 
for two rounds of awards under the Art in Rural Communities Assistance 
Initiative. The Forest Service provided an additional $300,000 in funds 
and administered the application and grant process. Both the Forest 
Service and the Arts Endowment publicized the Initiative, but 
applications were submitted to and the grants awarded by the Forest 
Service.
    In the first round, there were 19 grants awarded for projects in 
small, rural communities in 14 states; in the second round, there were 
17 grants awarded for projects in 15 states. The 36 grants in a total 
of 23 states went to local arts agencies, state arts agencies, heritage 
centers, tribes, performing arts organizations, museums, a school 
district, development organizations, and colleges.
    The grants were for a wide variety of projects including, for 
example:
  --Cooperative marketing of arts and crafts in New Mexico and Puerto 
        Rico.
  --Apprenticeships in traditional arts in Puerto Rico, Arizona, and 
        New Mexico. Heritage tour development in Washington and 
        Tennessee; regional heritage area development in Ohio; African-
        American heritage tourism development in North Carolina; 
        marketing the performing arts in Virginia's Shenandoah Valley.
  --Documentation of folk and traditional arts in Colorado, Nevada, and 
        Montana.
  --Exhibitions relating the arts and natural resources in California, 
        Hawaii, New Hampshire and West Virginia.
  --Festivals in Colorado, Idaho, Maine, New Hampshire and Utah.
  --Design plans for the restoration of an opera house in South 
        Carolina.
  --A community theater residency in Kentucky.
  --An original play about the Nez Perce tribe.
                    office of enterprise development
    Question. NEA established this office as a means of exploring new 
methods for supporting the non-profit arts in America. It is charged 
with searching out ways to augment the agency's budget through 
authorized contributions and to expand the funding pool for the arts.
    How productive has this office been in the past year? What 
accomplishments can you point to? What pitfalls, if any, have you 
encountered? What conclusions can you draw from this office's successes 
or failures to date?
    Answer. The National Endowment for the Arts, as a grantmaking 
agency of the United States government, has never been recognized as a 
charity. The NEA has construed its mission as grantor rather than 
collector of funds. The Office of Enterprise Development has looked 
outside that context and attempted to assess the merits, feasibility 
and potential of various revenue generating activities. The OED does 
not define itself as a fundraising office for the NEA but rather as a 
hub for the agency's efforts to expand the overall funding pool for the 
arts. Consistent with that purpose, the OED has adhered to a commitment 
not to engage in activities which would divert funds that would 
otherwise go directly to artists or arts organizations. While there 
have been some notable accomplishments in the form of direct 
contributions to the agency (the H. J. Heinz Company gave $450,000, the 
largest corporate contribution to the NEA to date; a gift of stock 
valued at $95,000 from a private citizen marked the largest individual 
donation in the agency's history), the productivity of the office can 
not be measured in dollars brought in to the agency itself.
    The most consistent success has been in finding partners for agency 
supported projects. Corporate partners such as the Coca-Cola Company, 
Chase Manhattan, Nissan Motors, Atlantic Ridgefield, Dunwoodie 
Communications and others have contributed to the support of specific 
projects like American Canvas, the WritersCorps Project and the 
Oklahoma Rebuild Project. Very recently, Microsoft committed $250,000 
to the Benton Foundation, the Endowment's partner in the NEA conceived 
and initiated internet access project ``Open Studio.''
    The nature of the Endowment itself dictates certain parameters for 
the Office of Enterprise Development. First, the NEA is a federal 
agency and, in many instances, individuals, corporations and 
foundations will not, or can not by charter, give money to the 
government. They consider that their taxes already serve that purpose. 
Second, the agency is recognized as a grant making body. It would 
require a massive public relations campaign to shift that perception 
and spotlight the NEA as a recipient organization. Even if the 
Endowment had the authority to solicit and invest, such a shift would 
demand a major reassignment of both staff and financial resources to 
accommodate an ongoing capital campaign. Third, unlike the Smithsonian 
or the Library of Congress, the NEA does not own or generate product. 
The only thing approximating product which the NEA has is its 
reputation and brand recognition. Government ethics preclude the agency 
from using its name and logo, arguably its only marketable commodity, 
to enter into cause-related marketing ventures. The OED has found 
opportunities to enter into entrepreneurial fundraising activities such 
as affinity cards and product identification schemes but has been 
unable to pursue them because of these restrictions.
                         millennium initiative
    Question. In a recently issued report entitled Creative America, 
the President's Committee on the Arts and the Humanities calls for a 
Millennium Initiative in which both Endowments, as well as other 
agencies, are urged to participate.
    Please describe this initiative's purpose in greater detail for the 
subcommittee. Does NEA have plans to follow this recommendation that 
you can share with the subcommittee now? Are there any collaborative 
efforts with other agencies planned, as the report encouraged?
    Answer. Under the leadership of Chairman Jane Alexander, the Arts 
Endowment has for some time encouraged applicant organizations to 
propose projects that celebrate the Millennium. During the summer of 
1996, the Endowment announced that support was available for a limited 
number of artistically excellent, high-visibility projects that 
celebrate and showcase artistic achievements of the past century and 
that encourage innovative thinking about the future of the arts as we 
enter the 21st century. Eligible applications were reviewed by an 
advisory panel that included such individuals as radio personality 
Garrison Keillor; retired Montana Congressman Pat Williams; and Eugenia 
Zuckerman, internationally acclaimed flutist and regular commentator on 
CBS: Sunday Morning. Nineteen projects ultimately were approved for 
funding, including the commissioning of new dances by the American 
Dance Festival of Durham, NC; American Music Theater Festival's 100 
Years of American Musical Theater: Past Legacy and Future Visions in 
Philadelphia, PA; and a nationwide effort by Chamber Music America that 
will present more than one hundred jazz, chamber, and new music groups 
through a project called American Ensembles: A Musical Celebration of 
the Millennium.
    The Endowment takes seriously President Clinton's challenge in his 
most recent State of the Union Address that ``all Americans in the arts 
and humanities * * * join with their fellow citizens to make the year 
2000 a national celebration of the American spirit in every community, 
a celebration of our common culture in the century that is past and in 
the new one to come.'' The problem is a lack of appropriate levels of 
funding. As plans are underway for continued support for millennium 
projects, many alternatives are being discussed, including developing a 
more targeted, proactive approach. Consideration also is being given to 
supporting a few stellar projects that would provide opportunities for 
artists and audiences across the country. Any of these activities would 
be undertaken concurrently with the partnership activities that the 
Endowment develops with other federal agencies, as well as state and 
local arts agencies.
    Question. What portion of your budget will be committed to this 
initiative? How will support for the millennium project impact your 
core programs when it is not anticipated that a corresponding increase 
can be provided in future budgets?
    Answer. Approximately $4.8 million of fiscal year 1997 funds will 
be supporting more than 20 leadership projects for the millennium, in 
response to nearly 300 initial letters of intent totalling $66.8 
million. Contingent on appropriations, the Endowment will commit $4-
$4.5 million to these types of special leadership projects again in 
fiscal year 1998. In addition, many of the agency's other direct grants 
reflect a growing focus on celebrating the Millennium.
                            american canvas
    Question. This effort was organized by NEA to bring together local 
and national leaders in the arts, education, business, government, 
civic and consumer organizations, religious groups, and foundations to 
determine how to build a solid infrastructure for the nonprofit arts in 
America's communities. Both local and national representatives from 
these sectors had the opportunity to participate in this program 
through a series of six community forums and a national meeting.
    An Action Plan that would analyze the information gathered at these 
meetings, identify what works and recommend strategies is due out in 
the spring. At this time, can you summarize its findings for this 
subcommittee?
    Answer. During 1996, the National Endowment for the Arts convened a 
nationwide initiative of regional and community forums called American 
Canvas. These forums brought together more than 150 national leaders as 
panel participants representing the arts, education, business, 
government, consumer organizations, civic groups, religious 
organizations, and foundations to determine the value of the arts in 
communities and how to build a solid infrastructure for the arts in 
America's communities. Each of the six privately funded forums explored 
a different aspect of the successful integration of the arts into 
communities. The hosting communities were chosen for their leadership 
in the development of innovative strategies for supporting the arts.
    As a result of the dialogue that took place at the various sites, a 
national steering committee formulated ten ``Calls to Action,'' one 
relating to each of the six forum topics and four which emerged as 
general concerns in all six forums. In January 1997, a committee of 100 
leaders representing a variety of sectors reviewed the Calls to Action 
and discussed specific ways in which their organizations and sectors 
could work together nationwide to assist communities in ensuring an 
arts legacy for future generations. All of the above-mentioned 
activities will be discussed and combined to create the American Canvas 
report which will be published in the Fall of 1997.
    American Canvas participants identified a number of revenue sources 
for the arts across the country, many of which may be suitable for 
replication elsewhere. Just as traditional percent-for-art programs (in 
which a small portion of federal, state, or local construction expenses 
are earmarked for the incorporation of artworks and other cultural 
amenities) have brought millions of dollars to the arts, other 
dedicated revenue streams are being developed, often tapping 
``nonarts'' funds in the public sector to fund cultural activities. 
These include from hotel/motel taxes and entertainment/recreation 
taxes; revenues from lotteries and gambling taxes; vanity license plate 
sales; and sales taxes (where a percentage of the sales tax is 
dedicated to the arts).
    Additionally, American Canvas participants identified cultural 
tourism as an important way in which cities attract visitors and are 
thus devoting a portion of their convention and visitors funds to 
cultural activities. Cities have also used cultural facilities as 
community revitalization tools and are able to secure economic 
development, housing, and transportation funding to support these 
activities.
    These and other federal programs, such as the funding for arts in 
rural areas through the Forest Service and the Department of 
Agriculture and funding for job training in the arts through the 
Department of Labor, along with many private sector programs, were all 
ways which the American Canvas participants believed helped strengthen 
a community's infrastructure around its nonprofit arts. These ideas, 
and others, as well as strategies for their implementation will be the 
focus of the American Canvas report.
                            cultural tourism
    Question. Another interagency initiative is a partnership of the 
NEA, NEH, the Institute of Museum Services, and the President's 
Committee on the Arts and the Humanities, with the support of six 
national museum, humanities, arts, and historic preservation 
organizations. Its purpose is to encourage cultural organizations and 
the commercial travel and tourism industry to develop cultural tourism 
projects.
    How much has NEA contributed to this partnership? How does cultural 
tourism differ from tourism as we traditionally know it? Is the travel 
industry contributing resources to this effort? What about state and 
local governments? Chambers of Commerce? What makes this an area that 
merits special emphasis? Are there specific results from this 
initiative that you can point to at this time?
    Answer. Cultural tourism--``travel directed toward experiencing the 
arts, heritage, and special character of a place''--differs from the 
mass tourism market in its focus on cultural experiences as part of 
tourism. The travel and tourism industry in the United States has 
traditionally marketed natural resources (beaches, mountains, lakes), 
recreation (golf, skiing, fishing) and attractions (theme parks, 
casinos) whereas European nations have aggressively marketed their 
history and their arts as travel motivators. Given the Endowment's 
reduced budget level, encouraging the development of cultural tourism 
is an important way for the agency to help cultural organizations 
increase their earned income and demonstrate their importance in local 
and state economies.
    The National Endowment for the Arts contributed $50,000 to the 
Cultural Tourism Leadership Initiative. The National Endowment for the 
Humanities contributed $50,000 and the Institute of Museum and Library 
Services contributed $5,000. Through the President's Committee on the 
Arts and the Humanities, the American Express Foundation became the 
major travel and tourism industry contributor, donating a total of 
$35,000. Other travel and tourism industry organizations including 
state tourism offices, convention and visitor bureaus, travel 
magazines, airlines, and hotels, provided support.
    The American Association of Museums (AAM), the Federal agencies' 
cooperator, organized ``Partners in Tourism,'' composed of the Federal 
partners and eight national cultural organizations: the AAM, the 
National Assembly of State Arts Agencies, the Federation of State 
Humanities Councils, Americans for the Arts (formerly the National 
Assembly of Local Arts Agencies and the American Council for the Arts), 
the National Conference of State Historic Preservation Officers, the 
National Trust for Historic Preservation, the National Association for 
African American Heritage Preservation and the National Center for 
Heritage Development.
    The Cultural Tourism Leadership Initiative sponsored a series of 
regional forums: Mid-Atlantic (Annapolis, Maryland); Mid-Western 
(Indianapolis, Indiana); Southeastern (Chapel Hill, North Carolina); 
Far Western (Los Angeles, California); and Rocky Mountain and Plains 
States (Denver, Colorado). In New England, cultural organizations 
sponsored a half-day session on cultural tourism at a meeting of 
Discover New England, the region's tourism promotion organization.
    The Forums attracted more than 900 participants representing a wide 
variety of both travel and tourism industry (e.g., state travel 
offices, convention and visitor bureaus, hotels, tour operators) and 
cultural interests (e.g., state arts agencies, state humanities 
councils, local arts agencies, state historic preservation officers, 
heritage area coordinators).
    The focus of the Forums was the development of state action plans. 
Most states decided to form committees back home to expand and 
implement the plans. At least two states have held statewide cultural 
tourism conferences based on the Forum model; several states indicated 
their intention to pursue state funding for cultural tourism 
initiatives.
    As the last Forum was held in May, the Federal agencies involved 
are currently reviewing the Forum results to determine what further 
steps should be taken at the national level.
                         leadership initiatives
    Question. Beginning in fiscal year 1996, funds were set aside to 
support Leadership Initiatives. Last year, you were in the process of 
developing a structure for identifying and evaluating possible 
leadership initiatives and it was anticipated that information would be 
distributed in the months ahead.
    Can you share that information with the subcommittee now? What 
defines a leadership initiative grant and how does it differ from 
grants awarded through your other program categories? Are grants 
selected through the normal channels or is there a separate process of 
selection?
    Answer. Leadership Initiatives, in addition to the Millennium 
Initiatives discussed earlier, are awarded through grants or through 
cooperative agreements, and are undertaken in response to an identified 
need in the field, or to take advantage of a particular opportunity 
where the Endowment's catalytic national role can make a difference. 
All awards, whether grants or cooperative agreements, are subject to 
review and recommendation by the National Council on the Arts with 
ultimate approval by the Endowment's Chairman.
    Question. To date, what has been accomplished with this initiative? 
Have the first grants been awarded?
    Answer. Several Leadership Initiatives have yielded rich returns in 
terms of benefits to the arts and to citizens in communities across the 
United States. The Mayors' Institute on City Design, for example, 
brings together mayors and design professionals to improve the way 
cities solve their problems. Over two days of intensive discussions, 
the group works to analyze a number of design issues currently pending 
in the mayors' own cities. Recent participants included the mayors of 
Salt Lake City, UT; Tacoma, WA; Macon, GA; Charlotte, NC; Akron, OH; 
Shreveport, LA; and Lewiston, ME.
    A unique opportunity presented itself last year for the Endowment 
to help make possible the national expansion of The Writer's Voice, an 
extremely successful project of the YMCA in New York City. Endowment 
support will help to establish at least 25 new centers across the 
country over three years through a national arts training initiative 
that will provide YMCA staff with training workshops and publications 
to help them start centers at their local Y's. Writer's Voice centers 
make the literary arts more accessible to people of all ages, with a 
special focus on youth between the ages of 3 and 18.
    An innovative pairing of jazz and sports was the focus of another 
Leadership Initiative grant. The Thelonious Monk Institute of Jazz in 
Washington, DC, was awarded a grant to support the artistic development 
of young jazz students. The Monk Institute, the Endowment, the Los 
Angeles Lakers, Nissan Motor Corporation USA, and the National 
Association of Music Merchants have entered into a partnership that 
will provide after school and Saturday instrument training, master 
classes, mini-concerts, and other performance opportunities to aspiring 
musicians at two South Central Los Angeles high schools. Recently, jazz 
bands from the two schools began performing prior to Lakers home games 
with renowned jazz artists sitting in. The project has enormous 
potential as a national model, demonstrating how schools, corporations, 
and professional sports teams can utilize their respective strengths in 
developing young people into serious musicians.
                              nea web site
    Question. NEA Launched its Web Page on the Internet last spring. 
What sort of feed back have you gotten to date? Can you assess the web 
site's value to date in promoting NEA programs and providing greater 
public access?
    Answer. Internet traffic to the Endowment Website has more than 
tripled during the past year, with nearly 3 million hits to date, and a 
clear trend-line toward increased usage. Over 130,000 of the hits on 
our Website have come from other countries. The average visitor to the 
site spends 15 minutes viewing the information provided. More than a 
thousand prospective grant applicants have downloaded Endowment funding 
guidelines and application forms. Hundreds of other agencies and arts 
organizations have linked to our site, and Endowment staff have 
communicated through the Website with many US citizens living abroad. 
Positive press coverage has come from USA Today and several major daily 
newspapers throughout the country.
    It is too early to assess the value of the Website in specific 
dollar terms, but the increasing usage of the site, and the length of 
time spent by each visitor are very encouraging. Certainly the Website 
has saved valuable staff resources in permitting NEA staff to respond 
to requests for information electronically and allowing the public to 
access information over the Internet. In conjunction with Open Studio, 
an national internet access and training partnership with the Benton 
Foundation, the Website is clearly expanding access to information 
about the arts for the American public.
                                 ______
                                 

             Questions Submitted by Senator Robert C. Byrd

                             budget request
    Question. The fiscal year 1998 budget request is almost 37 percent 
above the fiscal year 1997 allocation. Given the current budgetary 
climate, and given the uncertain reauthorization status of the NEA, how 
did the Administration determine that $136 million was an appropriate 
funding level for the NEA?
    Answer. The request for $136 million, if realized, would still 
leave the Arts Endowment at a level 16 percent below our fiscal year 
1995 appropriation of $162.3 million. The $136 request is seen as 
partial restoration of funds that the Administration believes 
represents a modest but vital investment in our Nation's cultural 
heritage and its citizens' access to their rich and diverse artistic 
legacy.
    Question. What does the 37 percent increase buy for the American 
people?
    Answer. The 37 percent increase buys for the American people 
increased opportunities to experience and participate in the arts, a 
richer and more diverse choice of artistic works and traditions, 
education in the arts for children and people of all ages, and an 
endorsement of our citizens' belief that the arts should be nourished 
and shared with all people.
    Question. What would be your programmatic priorities at the 
increased funding level?
    Answer. Programmatic priorities were established as part of the 
agency's drastic downsizing and restructuring; they are reflected in 
our fiscal year 1998 budget request--direct grants for the four 
categories and leadership initiatives, and partnership agreements with 
the state arts agencies and their regional organizations. These would 
remain our priorities at the increased funding level.
    Question. Would your priorities remain the same if funding were to 
be decreased?
    Answer. In general, the agency's priorities are, as noted above, 
reflected in our fiscal year 1998 budget request. It is difficult to 
speculate with any surety on what our priorities would be ``if funding 
were to be decreased,'' as the response would probably hinge at least 
partly on the nature and extent of any additional decrease, remembering 
that the agency has already sustained a massive decrease and totally 
reorganized the way it does business.
    Question. How does your annual budget request reflect your arts 
education priority?
    Answer. Our annual budget request reflects our arts education 
priority in each of our budget components: Direct grants include our 
Education & Access category, specific to education, and funds in each 
of the other three categories (Heritage & Preservation, Creation & 
Presentation, and Planning & Stabilization) are also being used, in 
many of the grants, for projects having educational components. The 
Direct grants area also encompasses our Leadership Initiatives, several 
of which reflect educational aims and priorities. The State 
Partnerships, in addition, includes a priority for arts education 
programs conducted and supported in all of the states throughout the 
country.
    Question. Describe the impact on arts education for children which 
would occur if the agency were not reauthorized.
    Answer. The impact on arts education for children would be 
substantial if no funds were appropriated for the agency. If the agency 
were eliminated due to lack of funds, all of the direct grants and 
partnership agreement funds for arts education projects and programs 
would be gone, as would the Endowment's vital leadership role in 
working to establish the arts as part of the basic curriculum in 
America's schools. We believe that many of the arts education programs 
now being carried out by the state arts agencies, and by arts 
organizations such as museums, orchestras, and opera companies, would 
be reduced or eliminated, negatively affecting hundreds of thousands of 
our children. Though the Arts Endowment's funds are modest and 
represent only a portion of most program's total costs, they are 
crucial in establishing a priority for arts education and drawing 
together a complex network of partners from both public and private 
sectors. With so much concern evident about our children's education, 
it would be ironic indeed--and tragic, we believe--if this vital 
endeavor, built so painstakingly over the years, were to be dismantled.
    Question. Please describe any long term investments or new 
initiatives that are currently being developed. What effect would new 
initiatives have on existing grantees if funding is not increased?
    Answer. We view virtually all of our funding as long term 
investments. The artistic life and legacy of a Nation is a vast and 
vital reflection of its roots, its present, and, often, its future. 
Arts endeavors--be they the creation of a new symphony or painting, the 
teaching of art to young children, the broadcast of ballet on 
television, the publishing of poetry or fiction--are investments whose 
results may be seen immediately or years hence. As a complement to 
these investments, new initiatives are vital to the lifeblood of any 
funder in the arts, as the arts themselves constantly reinvent and 
reshape themselves, and as our nation continually changes 
demographically, ethnically, educationally, and economically.
    These two interrelated facts and philosophies are the underpinning 
of our new structure, which includes ongoing categories of project 
support to organizations and agencies, as well as leadership 
initiatives that enable the Endowment to effect specific, targeted 
outcomes. The new structure was created with both elements firmly in 
place so that they would complement each other and not impact 
negatively on existing grantees. Negative impact on existing grantees 
would be attributable not to new initiatives but rather to our 
drastically reduced budget.
             government performance and results act (gpra)
    Question. Please describe your progress and milestone toward 
preparing a strategic plan, including consultation with interested 
parties.
    Answer. The agency's strategic plan is moving forward, guided by an 
agency-wide staff planning group and a committee of the National 
Council on the Arts. We are beginning our review with the Office of 
Management and Budget and are discussing preliminary thinking with some 
of our advisory panels--private citizens from around the country--as 
well.
    Question. Given the current budgetary climate, and given the 
uncertain reauthorization status of the NEA, how are you addressing 
funding and authorization issues in the development of GPRA goals and 
the strategic plan?
    Answer. Development of the strategic plan, required by law to cover 
five years, is particularly challenging for an agency whose future 
currently appears to be as cloudy as ours. We are having to set these 
issues somewhat to the side for now, and are trying to focus on the 
fact that a five-year strategic plan is required, regardless of our 
status, unless the Congress eliminates the agency. Development of a 
five-year plan involves a very great deal of staff effort and time; the 
level of frustration is fueled by the prospect of our five-year plan 
being ``due'' before even our one-year future is known.
    Question. What are the grant-making priorities for the agency in 
the next year, for the next 5 years?
    Answer. Contingent, of course, on our continuing existence, and an 
appropriation not slashed yet again nor encumbered by additional 
earmarking, the grant-making priorities for the agency for the next 
five years are basically those reflected in our fiscal year 1998 budget 
request. We do not foresee, at present, major shifts or changes.
    Question. What are the organizational priorities for the agency for 
the next year, for the next 5 years?
    Answer. Our organizational priorities for the agency for the next 
five years are to continue to do everything within our power and 
available resources to serve the American people by carrying forward 
our programmatic goals.
                              grant-making
    Question. Within the request, direct program grants increase by 51 
percent over fiscal year 1997. How do you propose to allocate the 
requested increase among the different grant categories established by 
the NEA?
    Answer. The Arts Endowment has not allocated the requested increase 
for fiscal year 1998 among the four grant categories and leadership 
initiatives. If the increase were to be appropriated, the Endowment 
would apply the increase against the four interdisciplinary categories 
as warranted by the numbers and quality of the applications, and 
against leadership initiatives as well, with an emphasis on millennium 
projects. Increased funds would also be available to the state arts 
agencies through the State and Regional and Underserved Set-Aside 
accounts.
    Question. Although there is a request for 24 percent more funds in 
the Underserved Set-Aside allocation, the Underserved Set-Aside request 
is a smaller percentage of the total budget request in fiscal year 1998 
than that allocated in fiscal year 1997. Are the needs of the 
underserved community decreasing such that less emphasis is being 
placed on that portion of the NEA funding?
    Answer. No, the needs among artistically underserved communities 
are not decreasing. Two points need to be kept in mind in responding to 
this question:
  --Underserved communities are served not only by the Underserved Set-
        Aside (grants to state arts agencies for underserved 
        communities) but also by projects funded under the Direct 
        grants (including leadership) categories as well.
  --The authorizing legislation as amended in November 1990, 
        established a percent-of-funds formula to be set aside 
        beginning in fiscal year 1992 for state arts agencies' 
        underserved programs. The amount reflected in our request is in 
        accordance with that percent.
    A few examples of underserved projects funded this year under our 
direct grants appropriation:
  --A grant to Grass Roots Art and Community Efforts in Hardwick, 
        Vermont, to support publication of 20 years of G.R.A.C.E.--An 
        Inside View, a collection of work and biographies of self-
        taught artists in northern rural Vermont.
  --A grant to the Hiddenite Center in Hiddenite, North Carolina to 
        present touring artists in rural, ethnically diverse and other 
        underserved populations in communities in Alabama, Florida, 
        Georgia, Kentucky, Louisiana, Mississippi, North Carolina, 
        South Carolina, and Tennessee.
  --A grant to the Lakota Fund in Kyle, South Dakota, to support the 
        production of Oyate Ta Olowan (Songs of the People), a series 
        of half-hour radio programs featuring traditional Native 
        American music.
  --A grant to Music at Angel Fire, Inc., in Angel Fire, New Mexico, to 
        support performances in Angel Fire, Raton, Taos, and Las Vegas, 
        New Mexico, as well as youth concerts in Taos and Colfax 
        Counties.
  --A grant to the Network for Local Arts in Washington State in 
        Olympia, Washington, to support the Rural Touring Arts 
        Initiative that will develop two on-going rural touring 
        circuits, one in southeastern Washington and the Olympic 
        Peninsula, and the other--the applicant's stated priority--for 
        local communities in central-northwestern Washington.
  --A grant to Appalshop, Inc. on behalf of the American Festival 
        Project in Whitesburg, Kentucky, for its Community Capacity 
        Building Initiative which engages people who have had little 
        access to the arts in community arts collaborations.
  --A grant to Atlatl in Phoenix, Arizona, to support the Native Arts 
        Network Associates consortium and strengthen the development of 
        Native American arts.
  --A grant to Davis & Elkins College in Elkins, West Virginia, to 
        support the statewide West Virginia Folk Arts Apprenticeship 
        Program.
  --A grant to El Teatro Campesino in San Juan Bautista, California, to 
        support the presentation of ``La Pastorela,'' a religious drama 
        and Christmas tradition involving members of the community.
  --A grant to the Vigilante Players, Inc. in Bozeman, Montana, to 
        support touring to small communities in six rural Northwest 
        states.
  --A grant to the Clay Studio in Philadelphia, Pennsylvania, to 
        circulate the ``Claymobile,'' a traveling ceramics class in a 
        van, to inner-city and low-income communities.
    In addition, a number of the Arts Endowment's direct grants or 
cooperative agreements for leadership initiatives directly reach 
underserved communities; for example:
  --Funds to Chamber Music America in New York have brought chamber 
        music and jazz ensembles to live, teach, and perform in rural 
        areas including in the Arkansas communities of Blytheville and 
        Osceloa; King City, CA; the Georgia communities of Fitzgerald, 
        Tifton, and Moultrie; the Iowa communities of Jesup, Fayette, 
        and Decorah; the Kansas communities of Dodge City, Garden City, 
        and Liberal; the Kentucky communities of Bowling Green, 
        Prestonburg, Paintersville, and Salyerville; South Bristol, ME; 
        Roseburg, OR; the Pennsylvania communities of Somerset, 
        Indiana, and Johnson; and Big Sandy, TX.
  --Funds from a joint program of the Arts Endowment and the U.S. 
        Forest Service to the Augusta Heritage Center in Elkins, West 
        Virginia are supporting public programs with demonstrations of 
        the work of traditional crafts people; the programs will be 
        accompanied by apprenticeships, the Forest Festival, and a 
        Fiddlers' Reunion.
  --Funds from the same initiative (NEA/Forest Service) to the Homer 
        Council on the Arts/Pratt Museum in Homer, Alaska to support 
        ``Exploring our Place from Forest to Sea,'' a series of events 
        including summer story telling, outdoor sculpture, and 
        performances; a fall ``Gathering of Native Tradition'' on 
        nature arts; a winter program on Eskimo songs, dances and masks 
        which will travel to nearby communities; and a spring 
        exhibition on the ``Tongass: Alaska's Magnificent Rainforest.''
    Question. For fiscal year 1998, what are the approximate targets 
for the allocation of funds to the 4 funding categories and Leadership 
Initiatives?
    Answer. We have not yet established targets for the allocation of 
the 4 funding categories and Leadership Initiatives for fiscal year 
1998, as the uncertainties about our future at the very least raise 
questions about the level of funds that might be available for these 
purposes. Nonetheless, it appears that the proportion of applications 
just received for fiscal year 1998 funds is similar to last year's 
among the 4 categories, which is one guidepost for us, and, as advisory 
panels meet throughout this summer and fall, we will have a good idea 
of their quality and viability. Leadership Initiatives will probably 
receive an allocation similar to last year's, again contingent on 
appropriations.
    Question. When grant monies are used to establish or maintain 
endowments, how much of the federal funds are permitted to be used for 
administrative costs of operating the endowment?
    Answer. Federal and matching funds must be placed in the endowment 
corpus. These funds may not be used for administrative costs of 
operating the endowment.
    Question. What kind of technical assistance does the Endowment 
provide to arts institutions in the area of business planning and 
grant-application preparation?
    Answer. The drastic budget reduction of fiscal year 1997 forced the 
Endowment to discontinue one of its most valuable programs, the 
Advancement Program. Participants in Advancement were the beneficiaries 
of year-long one-on-one consultancies with experts in all areas of 
business and the arts, from board development, to fundraising, to 
investing. At the end of the consultancy, the organizations submitted a 
strategic plan that was evaluated before grant monies were awarded. 
Advancement grants were matched on a three-to-one basis with non-
federal funds. The Endowment currently has no ability to provide that 
type of service to its constituents.
    Applicants to the Planning & Stabilization category are subject to 
management assessments by outside contractors who provide information 
to help evaluate applications. The applicants are provided with the 
assessments at the end of the application review period. Planning & 
Stabilization grants are intended to strengthen organizations' ability 
to realize their artistic and public service goals. Planning offers 
assistance to organizations to assess carefully their strengths, 
weaknesses, and financial health. Stabilization helps organizations 
strengthen their own institutional capacity; adapt to the realities of 
their potential audiences and communities by determining and realizing 
an appropriate size; maximize and diversify their resources; or enhance 
their abilities to serve or strengthen their arts field.
    Endowment staff in the various artistic disciplines are well versed 
in the agency's guidelines, and spend many hours assisting applicants 
on the telephone and in personal meetings. In addition, Endowment 
representatives often hold sessions at the meetings of arts service 
organizations, college and university development officers, and other 
pertinent conferences in order to introduce prospective applicants to 
the agency, help them determine their eligibility, and select the 
appropriate category to which an application might be submitted.
    Question. What role does receipt of an NEA grant play in 
influencing private support of arts organizations?
    Answer. Grants to organizations from the National Endowment for the 
Arts require recipients to match their awards 1:1 or 3:1, depending 
upon the program, thus helping to leverage private funding for the 
arts. The credibility of the Endowment as the national identifier of 
artistic excellence and merit has proven to be an important tool for 
grantees, since most indicate that they raise private money well beyond 
the required match.
    Additionally, it is important not to overlook the ``big picture'' 
influence of federal funding for the arts, which not only affects the 
private sector but state and local government arts funding as well. The 
most recent statistics from the AAFRC Trust for Philanthropy printed in 
their Giving USA 1996 report indicate a strong upward trend in private 
giving to the arts, culture and humanities from 1965 to 1992, but a 
downward trend from 1992 to 1995. Private giving to the arts, culture, 
and humanities sector (which includes giving to institutions such as 
science and history museums, public television, and other cultural 
institutions as well as performing and visual arts institutions) 
increased from $2.31 billion to $10.23 billion from 1965 to 1992, after 
adjustment for inflation; however, between 1992 and 1995, private 
giving fell to $9.96 billion. Furthermore, arts and cultural giving 
declined to only 6.9 percent of total charitable giving in 1995 
compared to 7.6 percent in 1992. Federal dollars to the arts, 
specifically from the National Endowment for the Arts, also rose 
steadily over the same time period and peaked in 1992 at $175.9 
million.
    After 1992, the agency's budget declined yearly to reach $162.3 
million in 1995. In sum, the most recent four-year downward trend in 
private giving to the arts (1992 to 1995) coincides with a four-year 
downward trend in federal support for the arts, suggesting that 
declines in federal funding are having a negative impact on private 
giving to the arts. In contrast, over the previous two and one-half 
decades, rising federal funds coincided with increased private giving 
to the arts.
    State government contributions rose steadily between 1965 and 1990, 
as did funding at the federal level. The increased federal/state 
partnership also resulted in state arts agencies supporting the 
development of local arts agencies throughout their states. The 
aggregate budgets for state arts agencies peaked at $292.3 million in 
1990, dropped for three consecutive years and, in 1994, began to rise 
again and reached $262.2 million in 1996. After adjustment for 
inflation, aggregate state arts agency budgets have dropped by 25 
percent since 1990. Over this same time period, the National Endowment 
for the Arts budget dropped by 52 percent, after adjustment for 
inflation.
    While the estimates of local government funding for the arts cannot 
be calculated as easily or as accurately as state and national data, 
Americans for the Arts estimates local government funding for the arts 
at $600 million in 1992, $650 million in 1995, and $675 million is 
estimated for 1997. This growth in aggregate local support was not 
sufficient to keep pace with inflation over the time period, but more 
importantly was a dramatic change from the large increases posted from 
1983 to 1992, when the total contributions doubled--from $300 million 
to $600 million. (1983 is the first year that data are available on 
local government support.)
    Question. The Endowment is about to conclude its first year of 
grant-making in the grant funding categories established during 1996. 
Describe the manner in which the new categories meet the needs of the 
Endowment, the applicants, the grantees.
    Answer. When the Endowment received the devastating budget cut of 
fiscal year 1996, it was impossible to maintain the specialized 
categories of support that had existed for years. There was neither the 
money nor the staff to do so. The four broad categories were instituted 
as a realistic means of supporting all of the relevant activities of 
organizations involved in the arts under broad umbrellas. It was--and 
is--our belief that the categories provide opportunities for all 
aspects of the arts to be supported at the federal level.
    Much has changed for applicants to the four categories. Applicants 
now may submit only one application per funding cycle, necessitating a 
difficult choice for many of them. If they are entering into an 
endowment drive, for example, should they risk creative programming to 
apply for a Planning & Stabilization grant in this round? There also is 
the choice of which project to select for an application, as all 
support is now project-specific and no longer seasonal in nature. The 
Endowment staff has helped applicants through these questions as much 
as possible, and continues to provide outstanding service to the field.
    Many applications had to be rejected even though they were of a 
quality that would have been supported were more funding available. 
Projects that were supported, however, received substantial amounts in 
many cases. The Endowment has rewarded the best applicants with large 
percentages of their requests, providing significant support to the 
best projects in the country.
    Question. What changes do you anticipate making in the grant 
guidelines before the next round of funding?
    Answer. The primary guidelines, for Grants to Organizations, were 
modified between fiscal year 1997 and 98 to clarify matters that seemed 
in need of attention following the first round of applications (for 
fiscal year 1997). Very few substantive changes were made. The fiscal 
year 1998 guidelines were distributed to the field in December 1996 for 
application deadlines in April 1997. We are currently reviewing those 
guidelines again, for fiscal year 1999, seeking continually to 
streamline and clarify.
    The Arts Endowment's other guidelines, such as those for Literature 
Fellowships, American Jazz Masters, Heritage Fellowships in the Folk 
and Traditional Arts, and Partnership Agreements for State Arts 
Agencies and Regional Arts Organizations, are also reviewed annually 
and modified as warranted. Only the last of these guidelines, for 
Partnership Agreements, represented much change in fiscal year 1997, 
due to the streamlining and consolidation of several grant programs 
into single Partnership Agreements. We anticipate no major changes in 
the coming year.
    Question. Will streamlining your grant review process from a four-
step process to the use of a single-level advisory panel process allow 
any savings in staff time necessary to review the applications?
    Answer. The same level of staff review is required for all 
applications submitted to the Endowment, regardless of the levels of 
review. Staff check the application for completeness, adherence to 
appropriate deadlines and guidelines, and eligibility. They then 
prepare the applications for review by panels. Doing away with the 
combined arts panel level of review will save staff time, however, in 
that there will be fewer panel meetings.
    Question. How does the single-level advisory panel reduce the four-
step process?
    Answer. There were four levels of review in the last funding cycle: 
a discipline specific review (e.g. dance, theater, opera, etc.); a 
combined arts panel made up of representatives from many disciplines 
plus generalists and lay persons; the National Council on the Arts; and 
the Chairman of the National Endowment for the Arts.
    The current round combines the first two levels into one panel 
review. While panels are now grounded in specific disciplines or 
fields, they have been broadened to include generalists and other 
individuals who represent allied fields that could bring valuable 
contributions to the review of arts applications. Every panel also 
includes at least one knowledgeable lay person. Post panel evaluation 
is still done by the National Council, which has the authority to 
recommend applications for funding or to reject them. Final decisions 
on all grants to be awarded rest with the Endowment's Chairman.
    Question. When is the single-level advisory panel system 
anticipated to be in place for use in the review of applications?
    Answer. Panel meetings began on June 19 and will continue 
throughout the year. Periodic meetings of the National Council review 
the work of the panels.
    Question. Are advisory panels considered to be peer review, or are 
the panels composed of NEA staff members?
    Answer. Panels are not composed of NEA staff members. As described 
above, they are composed or experts in the various arts disciplines and 
fields, generalists and individuals from professions outside of but 
connected to the arts, and lay persons.
                             reorganization
    Question. How has the 1996 reorganization affected the daily 
operations of the NEA?
    Answer. The 1996 reorganization had a substantial impact on the 
daily operations of the NEA. Following the month-long period of 
government shut-downs and snow closings, coupled with the loss of 89 
employees and major reduction and total overhauling of office space, 
the staff needed to adjust to new working surroundings, a new way of 
handling applications (in the 4 new categories), and, for some of them, 
new jobs resulting from RIF-caused shifts. Additionally, there was a 
four-level review process for applications, one of which, the Combined 
Arts Panels, was also new. Nearly all of the agency's systems and 
procedures needed to be revised; and there was a confused and concerned 
constituency needing assistance. An agency-wide assessment, and 
recommended retooling, of our information management and computer 
systems was in its early stages; and there were numerous inquiries from 
the Congress, the media, and the public.
    The Endowment's staff's hard work, intelligence, creativity, 
resilience and dedication throughout 1996 and up to the present have 
been models of the best of public service.
    Question. What lessons have you learned from the reorganization?
    Answer. We have learned from the reorganization that 
notwithstanding the suddenness and extent of the cuts, both in funds 
and in staff, the agency's resilience and commitment resulted in 
continued responsible and responsive service to the fields and the 
American people. We learned as well that our revised structure and 
guidelines, though a major change for our fields, brought forward many 
outstanding proposals, new partnerships, and newcomers to our applicant 
pool. We learned that our reduced level of funding and staff creates 
serious limitations in our ability to respond to the fields and the 
public compared with prior years, as evidenced by the many worthy 
proposals we are now unable to support.
    Question. Do you have further plans to fine-tune the NEA in terms 
of organizational structure?
    Answer. At the present time, we do not have any major plans to 
fine-tune our organizational structure; there may be a few minor 
adjustments, but the structure basically works and we plan to continue 
it.
                 change in number and amount of grants
    Question. Prior to fiscal year 1996 the NEA was awarding 
approximately 4,000 grants per year, and in fiscal year 1997 the 
estimated number of grants will be 1,100 grants. What impact has the 
decrease in grant numbers had on the arts community?
    Answer. The reduction in the number of grants has had a detrimental 
effect on many aspects of the arts in this country. One must not forget 
the immediate effect on the American public: fewer opportunities to 
participate in arts events. This hardship has been necessitated even 
though a Louis Harris poll indicated recently that 79 percent of the 
American public supports public funding for the arts; a 57 percent 
majority favors the federal government's direct support of the arts. 
The fiscal year 1997 funding level of $99.5 puts the Endowment 
approximately at its 1972 level, despite tremendous growth in arts 
activity and demand for participation in the arts across the country. 
Arts organizations, like all other businesses, must pay 1997 prices, 
not 1972 prices.
    Grantees have long reported that federal funds are the most useful 
in raising private funds. As we have reported in past years, Endowment 
grants are matched many times over with private funds that often come 
as a result of the Endowment's imprimatur and stringent review process. 
Such private giving will decrease or disappear for many arts 
organizations that no longer receive Endowment support.
    Even those organizations that received funding from the Endowment 
in fiscal year 1997 were faced with many months of uncertainty leading 
up to their awards. They realized that the continued excellence of 
their programs would not be enough this year, and that many 
applications would be rejected for lack of funds. This uncertainty made 
it difficult to plan for projects in the coming months.
    Many of the grants awarded prior to fiscal year 1996 were to 
individual artists such as composers, choreographers, playwrights, and 
designers. Those grants now are precluded by legislation. Only 
fellowships in literature and awards to jazz masters and folk and 
traditional artists are available from the Arts Endowment. 
Consequently, dance companies, orchestras, theaters, and other arts 
organizations will, over time, have less work to present. New work is 
at the heart of artistic activity; without it organizations will 
stagnate.
    Question. Are there organizations which previously were recipients 
of grants that are no longer in operation for which their decline is 
attributable to the decrease in available funding?
    Answer. Because we are in only the first year of grants under the 
new structure and reduced funding, it cannot yet be documented that 
organizations have closed as a direct result of the cuts. We do know, 
however, that arts organizations have long been in a precarious 
position, and cannot sustain themselves for long without funding. For 
example, some 23 theaters have closed in the past five years. Dance 
companies are closing because they cannot find enough venues in which 
to tour. The Endowment has received clear and moving letters and 
telephone calls from organizations, many of which have been supported 
with federal funds for many years, stating that the withdrawal of 
funding this year puts their very existence in jeopardy.
             leveraging federal funds with matching grants
    Question. Describe the matching requirements for recipients of NEA 
grants.
    Answer. The law requires that all Arts Endowment grants to 
organizations, with few exceptions, must be matched at least dollar for 
dollar, i.e., a one-to-one match. Many projects that we are supporting 
with fiscal year 1997 funds evidence a greater match. In addition, in 
our Planning & Stabilization category, all grants between $75,001 and 
$500,000 will require a match of at least 3 to 1.
    Question. Are the matching requirements a challenge for applicants 
to meet?
    Answer. The matching requirements are a challenge for many of our 
applicants, particularly the mid-size to smaller organizations and 
those of any size that have been having major fund-raising or 
accumulated deficit problems. In all instances, grantees report that 
Arts Endowment funds are an important catalyst in securing funds from 
the private sector.
    Question. Do the matching requirements limit the numbers of 
applicants?
    Answer. The matching requirements, particularly the 3 to 1 match, 
do limit the numbers of applicants. Probably a greater limiting factor 
(on the number of applications to the Planning & Stabilization 
category) is the Arts Endowment's prohibition on more than one 
application per year to the four categories: in the past, applicants to 
our Challenge Grant and Advancement Programs (precursors of Planning & 
Stabilization) were allowed to apply each year both for that type of 
grant and for a grant under another category or categories. Now, the 
applicant has to choose between, for example, an application to 
Planning & Stabilization or an application to Education & Access. This 
is a difficult choice for many organizations.
    Question. Have the requirements for the percent of match required 
of grantees remained constant?
    Answer. The matching requirements did change from our fiscal year 
1997 to our fiscal year 1998 guidelines, but only in the Planning & 
Stabilization category. Fiscal year 1997, three levels of match were 
described in the guidelines, 1-1, 3-1, and 5-1, depending on the size 
of the grant. For fiscal year 1998, this changed to two levels: 1-1 and 
3-1. The very largest organizations, it was seen, will tend to match at 
or above the 5-1 match, especially if they are mounting major capital 
campaigns for endowments. For the mid-sized and smaller organizations, 
the 5-1 requirement was seen as discouraging worthy groups from 
applying for what they truly needed and could reasonably be expected to 
match.
    Question. Must the grantees be able to prove/show in their 
applications that there is a high likelihood of raising the matching 
funds needed to secure the NEA grant?
    Answer. When organizations apply to the Arts Endowment, they must 
reflect the amount and source(s) of matching funds in their 
applications. Since applications in the four categories are currently 
submitted 7-11 months in advance of notification of grant award or 
rejection, many applicants are able only to estimate the match. But 
once applicants are successful and become grantees, they are monitored 
by several methods--revised budget requests, progress reports, cash 
requests--to insure that the match is valid and secure. Recipients of 
Planning & Stabilization funds for cash reserve and/or endowment 
purposes are monitored even more closely throughout and following the 
grant period.
    Question. How do the applicants for grants show the Endowment that 
they can provide the matching funds required with the NEA grant?
    Answer. Applicants for grants provide, as part of the project 
budget section on the application form, specific information on the 
total match expected toward the project for which they are requesting 
support.
                        underserved communities
    Question. If most corporate and foundation dollars are given 
locally, and if the largest and most prestigious organizations often 
receive those scarce gifts, how do the small organizations cities and 
rural areas and the organizations located there raise their matching 
funds?
    Answer. Because the amounts of the grant requests of organizations 
in small and rural areas tend to be relatively low, in keeping with 
their likelihood of being small to mid-sized organizations, matching 
resources often can be garnered from a combination of existing and new 
sources of revenue. For instance, grantees that have been awarded 
$15,000 for a strategic planning process can match the Endowment's 
money by utilizing $5,000 in earned income increases over the previous 
year's budget, $2,500 from accumulated surplus, $5,000 from a board 
contribution specifically for the purpose, and $2,500 of operating 
income used to support the staff salaries for participants in the 
planning effort. Since the amounts from each source are relatively 
small in and of themselves, small organizations can stretch existing 
sources to support the grant activity. That is not to say, however, 
that, in directing these resources for the grant purposes, the 
organizations may not be sacrificing other priorities.
    Some rural organizations propose marketing/audience outreach 
projects with the intention of raising matching funds from the results 
of the grant project itself, which might last as long as two years. For 
example, one rural organization applied for funding to participate in a 
regional tourism promotion, and anticipated enough new dollars from 
higher attendance to help meet the match.
    Many rural grantees time their grant projects to coincide with a 
larger campaign that will bring in sufficient dollars to match the 
Endowment funding. Such events as anniversary celebrations or, in a 
recent case, the retirement of the founding director, provide 
opportunities to go to donors for increases in their usual levels of 
contributions.
    Collaborations of organizations in rural areas are another source 
of match. For instance, a shared touring initiative or planning effort 
can generate revenue from a variety of sources--perhaps small amounts 
individually but significant when combined to meet the match.
    While it is often difficult for organizations in small and rural 
areas to raise foundation and corporate gifts, they are sometimes 
successful in this regard, at times receiving one-time awards for 
special projects. Some rural organizations are national in reach and 
can tap into more traditional funding sources. Artists' colonies, for 
example, may be relatively small and isolated; however, within their 
artistic field, they have access to a few discipline specific 
foundations and even some specialized corporate funding. And small 
rural festivals have had success selling advertising to local 
businesses.
    Question. How does the per capita receipt of grant funds by 
organizations in rural areas and small towns compare with those 
received by organizations in urban areas?
    Answer. Of the eight states having a population of under 1 million 
(Wyoming, Vermont, Alaska, North Dakota, Rhode Island, Delaware, South 
Dakota, and Montana), the per capita receipt of grant funds ranged from 
a high of $1.10 (Wyoming and Alaska) to a low of $.68 (Montana). On 
average, these states received $.90 per capita. The eight states having 
the largest populations (all over 9 million) (Michigan, Ohio, Illinois, 
Pennsylvania, Florida, New York, Texas, and California) averaged a per 
capita receipt of grant funds of $.30. California, with the largest 
population (of over 31 million) received $.26 per capita, and Michigan 
(the smallest of the eight with a population of 9.5 million) received 
$.11 per capita.
    Question. Is this difference attributable not to population, but 
due to the scarceness of funds necessary to meet the matching 
requirements?
    Answer. The figures indicate that, regardless of whatever 
difficulty organizations in small and rural communities may have in 
meeting the grant matching requirements, their success rate at the 
Endowment is quite good. While the eight smallest states represent less 
than 3 percent of the Endowment's total number of applications, they 
comprise 4 percent of the total number of awards (and over 5 percent of 
total dollars awarded). Individually, these states averaged awards of 
just over 50 percent of applications they submitted. South Dakota had 
the highest success rate, with more than 83 percent of its applications 
funded, and Delaware and North Dakota each had more than 70 percent of 
their applications funded. Vermont was lowest, with 33 percent of its 
applications funded. The average success rate for the country is 33.75 
percent.
                   funding sources other than federal
    Question. What percentage of your annual direct grantmaking 
capabilities comes from private sources?
    Answer. Only a minuscule percentage of the Arts Endowment's 
grantmaking capabilities is supported by non-Federal funds. For 
instance, in fiscal year 1995 less than 0.0033 percent of the Arts 
Endowment's grantmaking capabilities came from non-Federal, or private, 
sources; in fiscal year 1996 the amount was less than 0.12 percent.
    Question. What dollar amount of private, state, and/or local funds 
was used to meet the matching requirements for NEA grants? How do these 
matching funds compare with total funding available for the arts? How 
does the amount of federal funding for the arts compare with the annual 
total investment in the arts made by all entities in the US?
    Answer. Exclusive of matching funds for the Challenge Program 
(which requires a 3:1 match), in fiscal year 1996, 1,615 organizations 
met Endowment matching requirements, on average, with $10 for every $1 
awarded by the Endowment, a dollar amount of $559 million. In fiscal 
year 1996, the Endowment had a grantmaking budget of $80,734,000, out 
of a total budget of $99,470,000.
    As noted previously, the most recent Giving USA report indicates 
that about $6.6 billion total private giving to the arts in 1995. 
(Private giving figures are not yet available for 1996.) The National 
Assembly of State Arts Agencies reports that, in fiscal year 1995, the 
total legislative appropriation for the 56 state arts agencies was 
$265,558,735. Americans for the Arts (formerly the National Assembly of 
Local Arts Agencies) estimates local government funding for the arts at 
$650 million in 1995. The figures for state and local government 
funding are inclusive of program and administrative funding. In that 
same year, the grantmaking portion of the Endowment's budget was 
$137,512,000, out of a total budget of $162,311,000.
    Question. When a donor targets a gift to a specific field, does the 
NEA use the gift funds to replace appropriated funds that would 
normally be used in making the grant in that field, or is the gift used 
in addition to the appropriated funds?
    Answer. When a donor targets a gift to a specific field, the gift 
is used in addition to the appropriated funds, and not in place of 
appropriated funds. This is done to maximize the Arts Endowment's 
grantmaking funds. In light of the small amount of funds actually 
available through donations, as the figures in the prior answer 
indicate, few grants are made with donated funds in comparison to grant 
awards using appropriated funds.
    Question. If the gift is used to replace appropriated funds, are 
the donors aware that their gifts may not be buying an increase in 
overall program level for that area?
    Answer. Please see the answer to the previous question.
    Question. Gift giving to the NEA was $953,000 in fiscal year 1994, 
$766,000 in fiscal year 1995 and $960,000 in fiscal year 1996. What 
leads the NEA to conclude that giving will be lower in fiscal year 1997 
and fiscal year 1998, at an estimated level of $700,000?
    Answer. In fiscal year 1994, the Arts Endowment convened its ART-21 
Conference in Chicago, drawing participants from all over the country. 
The private funds received for the purpose of underwriting the ART-21 
Conference are reflected in the total gift amount for that year, 
boosting that figure to $953,000. In fiscal year 1995, the Arts 
Endowment focused on its own downsizing and reorganization. The Agency 
did not sponsor or convene any large events, as reflected in the total 
amount of gifts received in that year, only $766,000. In fiscal year 
1996, the Arts Endowment convened American Canvas, a series of six 
community-based meetings across the country, bringing together the arts 
community with civic, business, religious, government, education and 
community representatives to discuss topics designed to elicit concrete 
suggestions for how communities might best support arts at the local 
level in an era of dwindling public resources. The private funds 
received for the purpose of underwriting the American Canvas series are 
reflected in the total gift amount for that year, boosting that figure 
to $960,000.
    The Arts Endowment is not planning convocations similar to ART-21 
or American Canvas for fiscal years 1997 and 1998. Prudence, therefore, 
dictates that the gift projections for fiscal years 1997 and 1998 
should be closer to that of fiscal year 1995 than that of fiscal year 
1994 or fiscal year 1996.
    Question. What changes in legislative authority would be needed by 
the Endowment to solicit and invest private funds?
    Answer. At a minimum, the Endowment's authorizing statute should 
specifically provide ``solicit and invest'' authority. At present, this 
statute allows only gift acceptance. Based on its gift acceptance 
authority, the Endowment has implied solicitation authority for seeking 
private funds. However, the Endowment at present has no investment 
authority.
    Additional changes in legislative authority would be necessary in 
order to enable the Endowment to generate earned income (such as 
through operation of a gift shop, licensing of Endowment-related 
products, or other agreements with corporate donors to generate 
additional revenue).
    Question. The Institute of Museum and Library Services was last 
year permitted to ``solicit and invest'' private gift receipts. Is the 
NEA proposing any language which would give it the authority to do the 
same?
    Answer. The NEA has engaged in limited efforts to solicit funds 
since at least the early 1980's, and donations have been accepted since 
the creation of the agency. The ability to both solicit and invest 
would greatly enhance the agency's ability to attract private dollars 
to supplement the federal appropriation. The agency would welcome 
language such as that provided for the IMLS last year.
                              partnerships
    Question. Describe your efforts to leverage federal funds through 
partnerships with other federal agencies, as well as state and local 
organizations.
    Answer. At the beginning of fiscal year 1997, the National 
Endowment for the Arts had 25 formal agreements with other Federal 
agencies to participate in collaborative partnerships. Among these 
agencies are the Departments of Agriculture, Commerce, Education, 
Housing and Urban Development, Justice, State, Transportation, Health 
and Human Services, the General Services Administration, and the U.S. 
Information Agency. These partnerships are supported by $3.859 million 
in funds from the other Federal agencies and $2.069 million in NEA 
funds.
    The Arts Endowment seeks to expand support for artists and arts 
organizations through Federal interagency collaborations to develop 
programs that specifically include the arts and that are jointly funded 
by the Arts Endowment and its Federal partner. Recent initiatives have 
notably involved ``non traditional'' Federal funding partners and a 
focus on the role of the arts in meeting the economic and social needs 
of communities.
    In these cases the collaborations involve a pooling of resources 
for specific purposes. Examples of joint funding ventures include the 
partnership between the Arts Endowment and the United States 
Information Agency to support the Fund for U.S. Artists at 
International Festivals and Exhibitions; Pathways to Success, a 
collaboration with the Department of Justice, that supports after-
school and weekend programs for at-risk youth, their families, and 
their community; and The Arts and Rural Development Assistance 
Agreement, a partnership between the Endowment and the Department of 
Agriculture's Forest Service that supports arts-based rural community 
development projects.
    The majority of the jointly-funded interagency partnerships are 
supported by funds from other Federal agencies that exceed the amount 
of funds contributed by the Arts Endowment.
    Question. Are you planning on starting any new interagency efforts 
in fiscal year 1998?
    Answer. The number and focus of interagency agreements, the sources 
of their funding support, and the methods for their implementation vary 
from fiscal year to fiscal year. The program priorities of the Arts 
Endowment, the identified needs of artists and arts organizations, and 
unanticipated opportunities within the Federal sector all influence the 
development of interagency collaborations. Consequently it is difficult 
to predict the extent to which new Federal partnerships will be 
initiated in fiscal year 1998.
    Under a new Federal partnership that will commence in late fiscal 
year 1997 and early fiscal year 1998, the Arts Endowment will be 
collaborating with the U.S. Department of Education's Safe and Drug 
Free Schools Program in Creative Partnerships for Prevention, a Drug 
and Violence Prevention Program for Youth Using the Arts and 
Humanities. This program includes development of a Resource Guide for 
use in schools and community programs; a national awareness campaign; a 
World Wide Web site; and demonstration sites establishing and modeling 
arts-based prevention programs using a collaborative approach. Support 
from the Arts Endowment will enable an additional seven youth arts 
programs to participate with the eight original arts and humanities 
programs as demonstration sites. Arts organizations, school personnel, 
community organizations, youth, and their families will be involved in 
activities supported by this partnership.
    At the January 30, 1997, American Canvas National Forum, Secretary 
of Education Richard W. Riley announced five actions that the U.S. 
Department of Education and its partners are taking to support our 
schools through arts education and the Endowment's arts education 
initiatives that will continue in fiscal year 1998. They are:
  --Two publications to provide information and ideas about how schools 
        can more fully integrate the arts into their curriculum. 
        Transforming Ideas for Teaching and Learning the Arts is an 
        idea book about improving education in general and arts 
        education in particular. The Guide for Arts Education and 
        School Improvement Resources to help teachers, principals, 
        local school leaders, parents' groups, and local and state arts 
        leaders to learn about funding sources for arts education 
        programs.
  --An extension of the Department's partnership with the Arts 
        Endowment to continue the work of the Goals 2000 Arts Education 
        Partnership to the year 2000.
  --An annual awards program to honor arts education and business 
        partnerships to support quality arts education at the state and 
        local levels and to encourage more of them.
  --The recognition of outstanding schools, through the Department's 
        Blue Ribbon Schools Program, that have used the arts to lift 
        their school and their students to new levels of achievement 
        and that are examples of excellence in instruction and student 
        achievement.
  --The creation of a task force with parents, educators, researchers, 
        and the arts community to explore ways in which art and music 
        can help young children and families reach the America Reads 
        Challenge.
                      internet access to the arts
    Question. How will the NEA computer systems replacement project 
enhance the world wide web/internet capacity of the NEA?
    Answer. Currently, the agency has virtually no telecommunications 
capability (e-mail or Internet access). Our Wang-based 
telecommunications system is outdated, outmoded, and limited to a few 
offices, and it has no direct link to any external networks. The 
computer systems replacement project spurred the launch of our World 
Wide Web site, which has been an extremely successful public 
information tool. Upon completion of the agency's local area network, 
the Endowment staff will eventually be provided with e-mail and access 
to the Internet. Access to the Internet most likely will be undertaken 
in collaboration with the National Endowment for the Humanities, which 
will defray costs for both agencies.
    Question. What do you see as the future of arts access on the 
Internet? Are any of the arts education funds in the Department of 
Education budget used for this purpose?
    Answer. The Internet will provide extraordinary opportunities for 
the public to have access to the arts through exhibitions, online 
workshops and classes, and other interactive programming. Along with 
the Department of Education and the Kennedy Center for the Performing 
Arts, the Endowment established and supports ArtsEdge, a national arts 
education network on the Internet. The Department of Education also 
supports GOALS 2000--which include the arts as part of a basic 
curriculum--and support materials on the Internet.
    Question. Is access to the arts improving through the use of the 
Internet?
    Answer. Yes, but further progress is needed in two areas: more 
people need access to the Internet--most people cannot are without it 
at this time--and more arts resources must be developed and made 
available on the Net. Many arts organizations have begun to move online 
with Websites and other Internet resources, but most don't even know 
how to begin. Open Studio, an Endowment initiative with the Benton 
Foundation, is placing free public access sites in cultural 
organizations in all 50 states. The initiative is also establishing 10 
national web mentoring centers throughout the country, training 
hundreds of arts organizations and artists to become content providers 
for the Internet. The NEA's own Website has received nearly 3 million 
hits since its launch in April 1996, and usage is increasing 
dramatically.
    Question. Is the Internet used by the NEA or its grantees as a way 
to reach underserved communities?
    Answer. Yes. Open Studio is placing access sites in all 50 states, 
with an emphasis on communities in rural and inner city neighborhoods 
traditionally defined as underserved. Furthermore, by establishing web 
sites, our grantees are making their programming available to anyone 
with access to a computer and connection to the Internet. We have had 
people accessing the Endowment's web site from all 50 states and around 
the world and our supposition is that some of those visitors are from 
underserved communities.
    Question. Do you coordinate any grant monies with the Institute for 
Library and Museum Services in their grant programs?
    Answer. We work with the Institute for Library and Museum Services 
to insure that both agencies are not providing funds for the same 
projects. In addition, our application form specifies that applicants 
may not use other Federal grants as match for our grants.
                              initiatives
    Question. The foundation for the American Canvas project was that 
communities must take the primary responsibility to support their 
nonprofit arts. What benefits have the communities which participated 
in American Canvas seen to date? How will the communities continue to 
leverage their new knowledge and relationships?
    Answer. The American Canvas forums brought together more than 150 
national leaders as panel participants representing the arts, 
education, business, government, consumer organizations, civic groups, 
religious organizations, and foundations to determine the value of the 
arts in communities and how to build a solid infrastructure for the 
arts in America's communities. Each of the six privately funded forums 
explored a different aspect of the successful integration of the arts 
into communities. The hosting communities were chosen for their 
leadership in the development of innovative strategies for supporting 
the arts.
    As a result of the dialogue that took place at the various sites, a 
national steering committee formulated ten ``Calls to Action,'' one 
relating to each of the six forum topics and four which emerged as 
general concerns in all six forums. In January 1997, a committee of 100 
leaders representing a variety of sectors reviewed the Calls to Action 
and discussed specific ways in which their organizations and sectors 
could work together nationwide to assist communities in ensuring an 
arts legacy for future generations.
    American Canvas participants identified a number of revenue sources 
for the arts across the country, many of which may be suitable for 
replication elsewhere. Just as traditional percent-for-art programs (in 
which a small portion of federal, state, or local construction expenses 
are earmarked for the incorporation of artworks and other cultural 
amenities) have brought millions of dollars to the arts, other 
dedicated revenue streams are being developed, often tapping 
``nonarts'' funds in the public sector to fund cultural activities. 
These include hotel/motel taxes and entertainment/recreation taxes; 
revenues from lotteries and gambling taxes; vanity license plate sales; 
and sales taxes (where a percentage of the sales tax is dedicated to 
the arts).
    Additionally, American Canvas participants identified cultural 
tourism as an important way in which cities attract visitors and are 
thus devoting a portion of their convention and visitors funds to 
cultural activities. Cities have also used cultural facilities as 
community revitalization tools and are able to secure economic 
development, housing, and transportation funding to support these 
activities.
    These and other federal programs, such as the funding for arts in 
rural areas through the Forest Service and the Department of 
Agriculture and funding for job training in the arts through the 
Department of Labor, along with many private sector programs, were all 
ways the American Canvas participants believed would help to strengthen 
a community's infrastructure around its nonprofit arts. These ideas, 
and others, and strategies for implementation are being shared with the 
participating communities and others. Most important, however, for the 
participating communities is that a cross-sector dialogue was begun at 
American Canvas which can be built upon and enhanced for the purpose of 
creating a broad and sustaining infrastructure for the community's 
nonprofit arts.
    Question. Since the program began in 1986, over 300 cities have 
been represented at the Mayors' Institute. Briefly, please describe the 
impact the Mayors' Institute has had on those cities.
    Answer. The Mayors' Institute on City Design introduces mayors to 
the cultural and economic value of good design in the public realm and 
teaches them effective techniques for promoting wise public and private 
sector investment in their cities' built environment. The Institute 
also addresses the design process as an exercise in participatory 
democracy, which can give citizens an opportunity to work together to 
determine the future of their collective home. The following are just a 
few examples:
  --Former Fort Worth, TX, mayor Kay Granger (now a member of the U.S. 
        House of Representatives) gained the confidence in her own 
        design judgment necessary to veto a proposal for an addition to 
        the city's main public library that she thought looked like ``a 
        chain store in a strip shopping center.'' She insisted on a 
        process through which citizens could express their opinions 
        about ``what a library should be and how it should function.'' 
        Eventually, the city built a facility that the mayor reported 
        ``fit our downtown, fit our vision; this public building is 
        beautiful and the people are proud of it.''
  --Mayor Jan Laverty Jones of Las Vegas, NV, asked the Institute for 
        guidance in creating a ``gateway'' to the city's historic 
        downtown and revitalizing Fremont Street, birthplace of Las 
        Vegas's casino industry. The mayor was advised that it takes 
        more than a gateway to make people go through it, and that she 
        should concentrate on creating a destination that reflected the 
        city's unique character. The result was the ``Fremont Street 
        Experience,'' a multimedia sound and light show that has 
        attracted millions of dollars of new investment in the 
        surrounding area. Whereas only 20 percent of visitors to Las 
        Vegas once visited downtown, now 80 percent do.
  --Only a few weeks ago the City of Boise, ID,--at the urging of Mayor 
        Brent Coles, who participated in the Mayors' Institute in 
        1994--sponsored a retreat for elected officials in the region 
        of Idaho known as the Treasure Valley. The Treasure Valley is 
        experiencing dynamic population growth that is putting extreme 
        pressure on public resources while threatening the region's 
        quality of life. The format of the retreat was based on that of 
        the Mayors' Institute and resulted in a signed partnership 
        agreement, drafted by the officials themselves, that promised 
        cooperation among the communities in the Treasure Valley in 
        developing plans that will allow new development while 
        protecting those qualities that make the region special to 
        those who call it home.
    Other reports from Mayors' Institute alumni include:
  --Mayor Bill Johnson of Rochester, NY, is transforming an abandoned 
        supermarket building in a low-income neighborhood into an 
        anchor for a mixed-use commercial development that will create 
        a new neighborhood center.
  --Mayor Nancy Graham was recently featured in the New York Times for 
        her efforts to revitalize West Palm Beach--efforts to which she 
        credits her Institute experience.
  --The Civil Rights District of Birmingham, AL, was honored by the 
        National Trust for Historic Preservation, in recognition of a 
        project that evolved from Mayor Richard Arrington, Jr.'s 
        participation in the Mayors' Institute.
  --Mayor Rick Mystrom of Anchorage, AK, is using a museum expansion as 
        a catalyst for downtown revitalization.
                      establishing arts endowments
    Question. Please explain how NEA funds are used to assist grantees 
in establishing self-sustaining endowments or to establish cash 
reserves.
    Answer. The National Endowment for the Arts awards Stabilization 
grants to create or augment endowments and cash reserves. These grants 
assist arts organizations in two ways: Federal funds are used to create 
or augment the endowment or cash reserve; and, Federal funds are used 
to leverage matching funds. Typically, grant recipients are conducting 
large, multi-year capital campaigns. The traditional capital campaign 
model has two phases, leadership (sometimes referred to as the quiet 
phase) and public. Solicitations in the leadership phase are made to 
board and capital campaign committee members as well as close friends 
of the institution. The public phase involves solicitations of 
individuals and organizations less closely allied with the cultural 
institution. Generally, the public phase of a capital campaign is the 
most challenging and difficult stage. Stabilization grants can be very 
effective in leveraging non-traditional donors to give at a significant 
level.
    Due to the technical nature of endowments and cash reserves, the 
agency takes additional measures in the review of such applications and 
grants. Independent management assessments are conducted on all 
Stabilization applications recommended by discipline panels. This 
assessment analyzes non-artistic factors of the application which 
relate to the applicant's ability to carry out the project as well as 
the potential impact of the proposed grant. Staff members with 
expertise in non-profit accounting monitor endowment and cash reserve 
grants. In addition, it is required that grantees take the necessary 
legal measures to ensure that endowments and cash reserves will be held 
intact for ten years following the grant end date. These legal 
documents are reviewed by the agency's Office of General Counsel.
                         true endowment for nea
    Question. Has the NEA sought a federal endowment for itself?
    Answer. NEA supports the concept of establishing a true endowment 
at the Federal level. Testimony offered by witnesses in a 1995 Senator 
Labor and Human Resources Committee hearing suggested that to maintain 
the at-that-time current level of NEA grantmaking ($130 million per 
year) would require a corpus of about $2 billion to $4 billion, 
depending on projected long-range rates of inflation and interest. NEA 
would support the capitalization of such an endowment either through 
the appropriations process or by means of dedicated funding sources 
such as the reception of a portion of copyright fees or proceeds from a 
national lottery.
    The agency strongly supports the efforts of individual state arts 
councils to establish self-supporting endowments. The state of 
Delaware, for instance, recently completed a multi-million capital 
campaign to establish such a permanent endowment, and the NEA provided 
a $750,000 Challenge Grant early on as seed money.
    Question. Does the Endowment seek to learn from and offer insights 
to executives and staff from other endowment and philanthropic entities 
in the form of details and exchanges?
    Answer. There are many occasions, both formal and informal, in 
which various members of the Endowment staff are in communication with 
executives and staff from other endowment and philanthropic entities. 
Periodic meetings with groups of grantmakers have been held at the 
Endowment with the Chairman and senior staff. Staff members have 
attended regular meetings of Grantmakers in the Arts. Individual 
meetings on specific issues and questions take place regularly. There 
is communication and an exchange of ideas and experiences on a 
continuing basis.
                 NATIONAL ENDOWMENT FOR THE HUMANITIES

STATEMENT OF SHELDON HACKNEY, CHAIRMAN

                             budget request

    Senator Gorton. We will now hear from Dr. Hackney of the 
National Endowment for the Humanities.
    Dr. Hackney, you have suffered the fate of almost all 
second witnesses.
    Dr. Hackney. I am used to it, Mr. Chairman.
    Senator Gorton. In committee hearings, the attendance is 
not as great now. You are nonetheless, of course, welcome, and 
I want to join in the comments of some of my colleagues earlier 
in expressing our regret at your departure.
    I am sure you have always regarded yourself more as a 
teacher than anything else, and you will look forward to going 
back to that career and we hope and wish for you great success 
there, and we thank you for your service to the National 
Endowment for the Humanities.
    But before you go, we would like to hear from you today. We 
would especially like to hear from you about your search during 
this difficult period of time for different, better, and more 
effective ways of carrying out the functions of the Endowment, 
so that we will be happy to listen to your opening statement.

                summary statement of dr. sheldon hackney

    Dr. Hackney. Thank you very much, Mr. Chairman. I 
appreciate very much the opportunity to come and speak with you 
this morning.
    I am leaving Washington at the end of my term at the end of 
July, so I have been thinking perhaps a little bit more than 
usual about what the last 4 years has meant to me, and what we 
have been able to do at the NEH.
    Given the shortage of time, I would prefer not to read my 
statement.
    Senator Gorton. Your statement will be included in the 
record.
    Dr. Hackney. Thank you very much, and I will even be very 
brief in my oral remarks, so perhaps we can talk about the 
things that are of most interest to you. But I would like to 
say a word about the National Conversation on American 
Pluralism and Identity, and also maybe a brief word about a 
couple of the other priority programs that the NEH has been 
engaged in recently.
    The National Conversation on American Pluralism and 
Identity is the most significant special project that we 
carried out during my tenure. It is one in which I was deeply 
interested myself, and it is a project that has stimulated now 
3 million Americans to think more carefully about the meaning 
of being an American, about what values hold us together as a 
country.
    Most of those people were brought together on the Internet 
and by television and radio, but the meat and potatoes of 
humanities program are reading and discussion groups, and about 
80,000 Americans have been engaged with each other in reading 
and discussion groups in intensive face-to-face conversations.
    The need for the National Conversation was apparent to me 
at the outset of my tenure here at the National Endowment for 
the Humanities, and I believe this need is felt by most 
Americans today. That is, a sense of fragmentation, a sense 
that as a society we have been drifting apart from each other, 
that the bonds that tie us to each other, bonds of mutual 
responsibility, have been loosening of late. It was that sense 
of atomization that made me think that one thing the NEH could 
do was to use the power of the humanities to bring people 
together and to inform their thought about their connections 
with each other and about the meaning of their society, and we 
have done that.
    Let me say, this drifting apart is something that has been 
going on in America for 25 or more years. It has gone on 
through economic cycles, up cycles and down cycles. It has gone 
through Republican and Democratic administrations in 
Washington. It is not related, basically, to those. It is 
responding to more fundamental forces in our society.
    I will not give you my 50-minute lecture that I am going to 
be authorized to do soon about why we have been having this 
sense of fragmentation for the past 25 or more years, but 
briefly it is in response to the social revolutions that 
occurred in the 1960's, both the good aspects of those rights 
movements and also some of the darker aspects of the sixties, 
the friction that occurred in society.
    But more fundamentally, it is society responding to the new 
situation in the world, to the technological revolution that we 
are still living through, to the global marketplace that makes 
us all feel uncertain about our jobs in the future, and to the 
end of the cold war that makes the geopolitical situation less 
predictable than it was.
    For all those reasons, those four collections of reasons, 
if you will, we have been sort of drifting apart from each 
other. And public opinion polls show that. Lou Harris, for 
instance, has a poll in which he asks respondents whether they 
have little confidence, some confidence, or a lot of confidence 
in a long list of American institutions--the Presidency, the 
Congress, the press, universities, the clergy, and so on.
    What is interesting about that poll is not the particular 
pecking order of institutions within American life, but the 
fact that the level of confidence that Americans feel in those 
American institutions rise and fall together. They started 
falling precipitously in the 1960's. They drifted down further 
through the 1970's. There was a brief spike upward in the first 
Reagan administration in the early eighties, then they resumed 
their decline through the late eighties to today.
    Now, I think that decline is something to worry about, but 
we ought not to think that it is because of the performance of 
any of those institutional sectors of American life. That is a 
surrogate measure, if you will, of something that is more 
fundamental that is going on in American life.
    One other bit of evidence of that is that we know from 
polls as well that Americans are less trustful of each other 
than they were 25 or 30 years ago. We have polling data that 
shows that.

              the national conversation and civil society

    So this sense of fragmentation has been going on for a long 
time. NEH launched the National Conversation on American 
Pluralism and Identity to bring Americans together to talk and 
think and listen to each other about what pulls us together in 
our very diverse society. We were doing this before Robert 
Putnam, the Harvard professor who made himself and the issue 
famous in his article called ``Bowling Alone,'' in which he 
quantified the drop in American participation in voluntary 
organizations.
    And, thus, civil society as a concept became very 
interesting to intellectuals and journalists, and a great 
debate, a healthy debate has been going on since that time 
about civil society--that is, the nongovernmental, nonprivate, 
noncommercial sector of American life. The National 
Conversation is in that sector, and we have been bringing 
Americans together.
    Now, I think the good news from the conversation is that 
Americans are eager to talk to each other about what holds us 
together and about what divides us, as well. They are eager to 
work with each other across all of the usual divides of our 
culture--that is, race, class, gender, ethnicity. All of those 
dividing lines find Americans willing to leap across to work 
with other Americans from different backgrounds on common 
problems or on mutual understanding. That, I think, is very 
good news.
    Americans, as our conversation results show, like the fact 
that we are a diverse country, but they worry as Americans 
frequently have, about our cohesiveness. I think that is a 
healthy worry, because it means that in this traditional 
tension between individualism and community in America, that 
Americans now are worrying that we are not paying enough 
attention to community, and I think that is good.
    The bad news is that we know also from polling data and 
from participation in the National Conversation that there are 
worrisomely large levels of negative stereotyping in America. 
People in each group, each cultural heritage group, have 
negative stereotypes of members of other cultural heritage 
groups. When one speaks of race in America these days, one 
cannot simply mean black-white relationships. It is a 
multicultural problem, if you will, and multipolar, as well.
    Americans want there to be a common identity that all 
Americans have, and have equally. They want an arena, a large 
area of American life in which all Americans come just as 
Americans, and in which they are judged by the same criteria as 
all other Americans.
    At the same time, they want to honor their own particular 
cultural heritage. They want to be both and that is the sort of 
thinking that we have to learn to do in the future.

                  the conversation and american values

    It is clear from the conversation, and as one would learn 
as a student of American history, that the core of the values 
that hold us together as a society are those values that were 
enunciated by the Founding Fathers in the Constitution and the 
Declaration of Independence. They are the values of self-rule 
and the values not only of individual rights but also of 
democracy.
    It is America as an idea of democracy. It is the fact that 
we committed ourselves as a nation at the outset to both 
liberty and equality. Those two things do not always pull in 
the same direction, and they change their meaning as new 
circumstances occur, so it is the working out of the meaning of 
liberty and equality in American life that is the great 
challenge of the future.
    Let me bring to your attention a young, phenomenal golf pro 
named Tiger Woods who has caused a good bit of a stir lately, 
having just won the masters at the age of 21, the youngest 
champion ever. He is interesting, because he is frequently 
spoken of as an African-American, yet he has now begun to 
remind reporters that that is not an accurate description of 
him.
    His mother is Thai, a Thai-American. His father is African-
American and American Indian and some Irish, so he is a 
multicultural American, and he wants not to be known by any one 
of those components but by all of them. He wants to be an 
American and all of those other things at the same time. That 
is something that most Americans agree to and think is right 
and proper.
    So I find the meaning of America that comes out of the 
National Conversation to be our commitment to the idea of 
democracy. I think that is broadly and widely shared, but it 
needs to be brought to the surface by Americans, among 
Americans as they think about the meaning of their lives and 
what holds them together.
    To be sure, there are other common traits that Americans 
have that we could probably have difficulty identifying and 
agreeing upon, but they are there. Most Americans, and 
certainly foreigners, recognize Americans all the time by their 
behavior and by the things that they hold dear: by their 
individualism, for instance, and by their self-reliance, and by 
their tolerance. Those things are characteristics that go into 
an American national character.
    So I think the National Conversation has been enormously 
successful as well as valuable for the country, and I am 
pleased that we did it. I am in the midst of preparing--it is 
almost completed--a report to the Nation that will be published 
before I leave NEH. You can hurry right now and make your 
reservations at the Government Printing Office for your copy. 
It should be interesting, and it really is an extended essay as 
well as a statistical report on the conversation.

                      transition to a lower budget

    Finally, let me say that despite the fact that our budget 
was cut dramatically in 1996 by 36 percent, we have made the 
transition to the lower level with a great deal of pain, but 
also with a great deal of pride as well.
    We have been able to do some new things, to focus anew on 
the quality of humanities education, and on getting the 
humanities into the new technological era, into the digital 
age, if you will, in various ways.

                           prepared statement

    We have been doing that with great imagination. We are not 
doing business as usual. We have been finding partners outside 
the Endowment to help fund programs that we think are 
important. We will continue to do that, and we have begun to 
operate even a little bit differently within the Endowment.
    So even though we are smaller we are no less important to 
the humanities and the Nation, and I thank you for your 
support, Mr. Chairman.
    Senator Gorton. Thank you, Dr. Hackney. That was as 
fascinating an opening statement as I have heard in some time, 
and I solicit from you the full 50-minutes worth when it is in 
print. I will be delighted to read it.
    Dr. Hackney. Thank you.
    [The statement follows:]

                 Prepared Statement of Sheldon Hackney

    Mr. Chairman and Members of the Committee: It is an honor 
to appear before this Committee once again to speak on behalf 
of the National Endowment for the Humanities. I welcome this 
opportunity to discuss the agency's fiscal year 1998 budget 
request and to speak with you about some of the ways the 
Endowment contributes to the educational and cultural life of 
the Nation.
    I would first like to tell you how pleased we at the 
Endowment were for President Clinton's strong statement of 
support in his State of the Union Message to Congress in 
February. Speaking of the importance of building a vital 
national community, the President reminded us that ``the 
enduring worth of our nation lies in our shared values and our 
soaring spirit'' and called for continued support of the 
federal government's efforts to advance the humanities and the 
arts. I know that this Committee, as it has shown over the 
years, also shares both the President's affirmation of the 
importance of the humanities and of the role the Endowment 
plays in providing a national focus to efforts to help promote 
them.
    The American people have every reason to be proud of NEH's 
more than three decades of accomplishments in pursuit of its 
mission. Those accomplishments would not have been possible 
without the strong bipartisan support of Congress. The 
Endowment's grants to educators, scholars, and institutions 
across the Nation have helped to preserve and strengthen our 
cultural heritage. NEH exists to encourage humanities 
activities of truly national significance. Among the many 
outstanding examples of projects that Federal funding of the 
humanities has made possible are the documentary editions of 
the papers of presidents of the United States, summer seminars 
and institutes for teachers to revitalize their teaching of the 
humanities, educational films for television like Ken Burns's 
pathbreaking series on the Civil War, touring museum 
exhibitions like the recent ``Splendors of Imperial China'' 
show at the National Gallery of Art, efforts to preserve 
historically important brittle books and newspapers, and the 
work of the individual state humanities councils across the 
country that, in partnership with NEH, annually enrich the 
lives of millions of Americans.
    We are pleased that the President has requested an 
appropriation of $136 million for the agency for fiscal year 
1998. While this request represents an increase over our 
current funding of $110 million, it is still far below the $172 
million budget the agency had just 2 years ago. The cumulative 
effect of these 2 years of reduced funds has been to place an 
extraordinary strain on the Endowment's programming and 
operations--the number of grants we have been able to make has 
plummeted by about two-thirds and the award amounts for most of 
the projects we have been able to support have had to be pared 
down considerably. Make no mistake: This deep cut in the NEH 
budget has resulted in a dramatic reduction in the availability 
of high quality humanities projects and programs for the 
American people and is eroding the humanities infrastructure 
that NEH worked hard to help build over the last 30 years. The 
fiscal year 1998 funding request we have presented to Congress 
is designed to restore part of what we lost and to address 
specific needs in the humanities.
    Despite the present dire state of our funding resources, I 
want to assure you that the Endowment remains a vital national 
proponent and supporter of the humanities, that we are eager 
for the future, and that we will continue to search actively 
for ways we can better serve the American people. In recent 
years, for example, we have recast our relationship with the 
state humanities councils into a new Federal/State Partnership 
that has opened up fresh opportunities for the Endowment and 
the individual humanities councils to work more closely 
together in our shared mission of providing thoughtful, 
stimulating humanities programming for all the nation's 
citizens, reaching into every community in all 50 States and 
six special jurisdictions.
    Our budget justification describes in some detail our 
current activities and our plans for fiscal year 1998 and the 
coming years. I'd like to take a moment of the Committee's time 
to discuss a few of these items with you today.
    One critical way the Endowment helps to preserve and to 
extend access to our cultural heritage is through the financial 
support we provide for teams of scholars to produce documentary 
editions of the papers of important people and seminal events 
in our Nation's history. By searching out and drawing together 
documents from thousands of repositories nationwide, editions 
projects make available important materials for the first time. 
Included among these projects are editions of the papers of 
Benjamin Franklin, Thomas Edison, Dwight Eisenhower, and Martin 
Luther King, Jr. Such large-scale editorial projects have a 
tremendous intellectual impact and are truly the building 
blocks of research. For example, historians have used the NEH-
supported multi-volume edition of the Journals of Lewis and 
Clark to publish more than 20 books on different aspects of the 
expedition. Similarly, NEH support for the publication of 32 
volumes of the papers of George Washington has helped to make 
these essential primary source materials more widely available 
to students and scholars of Washington and the American 
Revolution. Indeed, the eminent historian of the nation's early 
period, Edmund S. Morgan, has hailed the editions of the papers 
of the ``founding fathers''--which have been made possible, in 
part, by funding from NEH--as the ``major scholarly achievement 
of American historical scholarship in this century.''
    Because of drastic cuts in funding for NEH, however, we 
find ourselves in the difficult position of not being able to 
support a number of worthy editions projects we have been 
supporting over the years. These are projects that make up an 
important part of our American Legacy. The nation thus will 
lose not only the investment we have already put into them, but 
will also forfeit their rich compilation of knowledge.
    To address this situation, we are proposing at our $136 
million fiscal year 1998 budget request level to implement an 
American Legacy Editions special initiative that would more 
than double the amount we are now able to provide to these 
projects, which would help ensure the continuation of these 
important undertakings. Under this special competition, 
projects would be provided with a combination of outright 
grants and the offer of ``matching grants'' from the Endowment, 
which would help support operating costs and greatly speed the 
projects to completion, and endowment-building Challenge 
Grants, which would help projects invest funds that would 
generate future operating income. We estimate that if this 
initiative were continued at this higher funding level for the 
next decade, these projects could be sustained and placed on a 
sound financial footing.
    Another area that is commanding a great deal of our 
attention and our creative thinking involves the relationship 
between the humanities and the new electronic information 
technologies. While NEH has long supported innovative 
humanities projects that use CD-ROM's, the Internet, and other 
digital formats, the additional funding the agency is 
requesting for fiscal year 1998 will enhance our national 
leadership role in preserving, digitizing, and disseminating 
important cultural and historical materials. We are in fact 
currently drafting a special report on the humanities and 
technology, which we expect to issue later this spring, but I 
would like to mention one or two examples of the kinds of 
things the Endowment is now doing and plans to do more of in 
the future.
    In 1996, the Endowment launched a special three-year 
special initiative, Teaching with Technology, that is helping 
to develop and introduce students to rich humanities content 
via CD-ROMs, the Internet, and other electronic technologies. 
The first grant deadline of this programming initiative yielded 
more than 300 proposals from schools and organizations across 
the nation, but scarcity of funds limited us to funding only a 
small number of projects. Included among the grants we were 
able to make was a project at Northwestern University in 
Evanston, Illinois to develop and deploy a multimedia database 
on the history of the United States Supreme Court. Recently 
included on the World Wide Web, , the project is enabling students from around the 
country, and the world, to learn more about this nation's 
highest court. The project reports that ``visits'' or ``hits'' 
at this web site are averaging a stunning 250,000 per month. 
The Endowment also supported a project under this initiative at 
Miami University in Ohio that is helping teachers of Latin use 
electronic resources in their classrooms and a project at the 
University of Virginia involving the use of CD-ROMs and the 
Internet to teach the history of the American Civil War. With 
the funds requested for fiscal year 1998, we would be able to 
build on these successes by putting in place another special 
programming effort for projects that will jump start the 
process by which schools and their teachers become more 
competent, and comfortable, with these new humanities materials 
and technologies.
    In this context, I know that the Committee will also be 
excited to hear about a major new partnership the Endowment has 
just entered into with the MCI Communications Corporation and 
the Council for Great City Schools (CGCS). MCI has committed 
$500,000 over two years to help create a new website, called 
``EdSiteMent,'' that will provide one-stop shopping for 
teachers, students, and parents who are searching for high 
quality educational materials in the humanities on the 
Internet. Drawing on the Endowment's acknowledged experience in 
supporting projects in this area and using our respected peer 
review process, a Blue-Ribbon panel composed of leaders in 
government, business, and education and parent organizations 
will select the materials for inclusion on the ``EdSiteMent'' 
website. NEH will also develop teacher guides for using the 
website in the classroom and the Council of Great City Schools 
will set up a hotline for teachers in need of assistance. We 
hope this public/private partnership will be a model for many 
other such endeavors in the future.
    The Endowment also intends to continue and to extend the 
national leadership we provide for efforts to digitize and make 
more accessible such important humanities texts and documents 
as the Dead Sea Scrolls manuscripts, ancient Egyptian papyrus 
fragments, the entire surviving corpus of ancient Greek texts, 
and the works of Shakespeare. Such projects will ultimately 
offer students, researchers, educators, and the general public 
electronic access to a rich array of original texts and 
supporting documentation pertaining to the roots of Western 
Civilization.
    Shifting gears slightly now, I would also like to tell you 
briefly about another programming initiative called My History 
is America's History. The Endowment's new Office of Enterprise, 
which is serving as a focal point for NEH's efforts to extend 
the reach of its programs, is coordinating the development of 
this effort. The initiative is designed to encourage Americans 
to learn more about the history of their families and to relate 
this history to the broad sweep of events and trends in 
American history and world history and will serve as a 
wonderful record of community history. We think this program 
has the potential of bringing the humanities into the lives of 
a broad segment of the public, which has been one of my primary 
objectives as Chairman of NEH. I should also mention that our 
Enterprise Office has been active on a number of other fronts, 
particularly our efforts to build partnerships with other 
organizations to promote the humanities like the MCI/NEH/CGCS 
``EdSiteMent'' website I have already mentioned and the joint 
arrangement we made last year with the Andrew W. Mellon 
Foundation to support humanities fellowships at independent 
research centers.
    In addition to this sampling of some of the special 
features of our fiscal year 1998 budget submission, I want to 
stress to you that the Endowment will also be continuing the 
support we provide for areas of the humanities where the need 
is greatest and where our leadership can continue to have the 
greatest impact: humanities education, the preservation of 
endangered research resources and artifacts, scholarly 
research, public programming, and the leveraging of private 
contributions to humanities projects and institutions.
    We will continue to help improve the quality of education 
in America by providing opportunities for teachers of the 
humanities to renew and strengthen their knowledge in their 
fields. The Endowment believes, and has long operated on the 
premise, that there can be no more productive use of the 
nation's resources than to invest in quality education. Each 
year, in fact, NEH supports a broad array of seminars and 
institutes that are attended by thousands of school teachers 
and college teachers from all over the country. The ultimate 
beneficiaries of such seminars and institutes are the hundreds 
of thousands of American students--in rural, inner-city, and 
other classrooms, as well as in colleges and universities--who 
annually are taught by these teachers. In the past twenty 
years, NEH seminars and institutes in the humanities have 
reached more than 50,000 teachers in every state of the union; 
these teachers have in turn reached more than 7.5 million 
students in the first year after their seminar, not to count 
subsequent students who will also benefit.
    The Endowment's projects that advance learning in the 
humanities make a profound and sustained impact on the lives of 
teachers and, by extension, on their students. Every year in 
fact we receive many statements from teachers who have attended 
NEH-supported seminars or institutes testifying to the impact 
of this experience on their teaching. For example, a public 
school teacher from New Jersey who attended last summer's 
seminar at Kenyon College in Gambier, Ohio, on ``The Poetry of 
Wordsworth and Keats'' recently wrote: ``I could have read 
Wordsworth and Keats for an entire lifetime in my own home and 
I would not have been able to gain the knowledge that I 
acquired during the four weeks that I spent at Kenyon College * 
* * [I]t has had a great impact on my performance in the 
classroom overall. I have been rejuvenated [and] my children 
are still excited when I tell them about it. In an area that 
does not value education as much as it should, I can see that 
my love of learning and my quest for knowledge has had an 
impact on their way of thinking.''
    The effectiveness and impact of the Endowment's 
comprehensive efforts to preserve and broaden access to 
historical materials vital to our cultural heritage have also 
been broadly recognized. NEH is in fact the acknowledged 
national leader in the movement to preserve cultural resources 
that are in danger of being lost forever because of the high-
acid content of the paper on which they are printed or the 
improper way they have been stored and handled. This effort has 
produced impressive results: Over the years, NEH has helped to 
preserve 750,000 brittle books and 55 million pages of American 
newspapers on microfilm and to improve the storage of 27 
million objects of archaeological, ethnographic, and historical 
importance held in American libraries, museums, and archives.
    In recognition of our importance as a national coordinator 
of preservation efforts, the Board of Directors of the 
Association of Research Libraries recently commended ``the 
overwhelming success of the NEH preservation program in 
preserving the nation's heritage and culture'' and hailed the 
Endowment's effort ``as a critically important program to 
ensure the preservation of and access to important * * * 
materials that are vital to our nation's ability to function as 
a democracy.'' The fiscal year 1998 NEH budget request would 
help NEH quicken the pace of these preservation efforts that 
have slowed considerably in the last two years because of 
reductions in the agency's budget.
    The Endowment is also a critical national source of support 
for important research and scholarship in the humanities. NEH 
grants to American scholars have resulted in thousands of books 
and articles that have added to our storehouse of knowledge of 
the past and have garnered hundreds of nationally recognized 
awards, such as Pulitzer Prizes, including the recently 
announced 1997 Pulitzer Prize for History; Bancroft Prizes; and 
National Book Awards.
    NEH has long been a crucial funder of such major scholarly 
undertakings as the compilation of dictionaries, historical and 
linguistic atlases, and encyclopedias. These complex projects--
which will serve as intellectual tools for future scholars, 
students, and general readers alike--do not have ready access 
to corporate, private, state, and local sources of funding and 
thus must rely on NEH support to continue their work. One such 
project that received a good deal of publicity recently is the 
NEH-supported archaeological team in Virginia that discovered 
and excavated the original Jamestown fort constructed by 
English settlers soon after their arrival in the New world in 
1607. This fort, long thought to have been destroyed by 
erosion, shows promise of adding to our knowledge and 
understanding not only of the aspirations of the English in the 
New World, but also about their encounter with Native American 
groups. The Jamestown archaeology project serves to remind us 
that collaborative research in the humanities, as in the 
sciences, typically involves substantial start-up costs and 
requires sustained support over many years. The project also is 
a model of how NEH matching funds can be used to leverage 
third-party funding--in this case, from the National Geographic 
Society--in support of basic research.
    One of the most rewarding experiences of my tenure as 
Chairman of NEH has been to observe firsthand the many ways the 
agency helps Americans learn more about their heritage, their 
culture, their past. Each year, for example, the individual 
state humanities councils, working in partnership with NEH, 
reach millions of people in libraries, Chautauqua-style tents, 
historical societies, grange halls, church basements, and 
senior citizen centers with quality humanities programs and 
presentations.
    Additional millions of Americans are also touched by 
national projects supported directly by NEH. Our funding makes 
possible such critically acclaimed television documentaries as 
the Ken Burns films and biographies of presidents Eisenhower, 
LBJ, and FDR. Three of the four blockbuster series that opened 
last fall's PBS television line-up were NEH-funded films: ``The 
West,'' which recently won a coveted George Foster Peabody 
Award, ``The Great War and the Shaping of the Twentieth 
Century,'' and the four-hour documentary on the life of 
President Theodore Roosevelt. The Endowment also supports media 
projects that illuminate other aspects of our national 
heritage, such as an award we made recently to the Institute of 
Language and Culture in Alabama to develop a six-hour radio 
series--In Their Own Voices: The WPA Ex-Slave Narratives--which 
is drawing on the more than 2,000 interviews of ex-slaves 
gathered through the 1930's WPA Writers Project.
    The fact that the Endowment's public programming efforts 
have a distinct impact on the cultural life of America is also 
demonstrated by the millions of Americans who annually visit or 
participate in NEH-supported humanities projects and by the 
geographic breadth and diversity of these projects. Currently, 
there are 147 educational exhibitions on humanities subjects 
and themes open to the public that will be seen during the 
course of their travels at more than 400 small and large 
museums, libraries, and other cultural institutions nationwide. 
The Anchorage Museum of History and Art and the Coastal Yukon 
Mayors Association, for example, received funding to mount a 
traveling exhibition of Yup'ik Eskimo masks drawn from the 
Arctic collections of major American and European museums. This 
exhibition, which explores the use of the masks in dance and 
ceremony, opened in the small rural Eskimo village of Toksook 
Bay in Alaska, traveled to the regional center of Bethel, and 
then went to Anchorage, where it was seen by nearly 200,000 
museum visitors. It is now en route to museums in New York 
City, Washington, D.C., and Seattle.
    Another example of the way NEH brings an essential national 
prospective to public humanities programming is the exhibition, 
``Barn Again!,'' which examines the barn as an agricultural 
structure, a monument on the American landscape, and a symbol 
of community and rural life. With funding from the Endowment 
and spearheaded by the Utah Humanities Council in cooperation 
with the humanities councils in Alabama, Georgia, Oregon, Ohio, 
West Virginia, Illinois, and Missouri, the exhibition and 
allied public programs are being presented at thirty-two small 
rural museums throughout these states, including the West 
Virginia communities of Mannington, Point Pleasant, Weston, and 
Elkins.
    As part of the agency's overall efforts to broaden 
Americans' access to the humanities, in fiscal year 1998 the 
NEH Challenge Grants program will sponsor a special initiative 
for public libraries to help them build endowments to 
strengthen their humanities programming. To make fund-raising 
more feasible for these institutions, particularly for public 
libraries located in rural areas or inner cities, the program 
will require only a two-to-one match under this initiative, 
rather than our standard three-or four-to-one match. NEH 
Challenge Grants are the Endowment's principle means for 
leveraging private support for the humanities.
    The Endowment remains the catalyst nationwide for private 
support for the humanities. When NEH awards a grant, by virtue 
of our rigorous merit review process, it also certifies to 
other potential funders the high quality of the project. As the 
Secretary of the Andrew W. Mellon Foundation, one of the 
nation's largest independent foundations, has stated: ``[T]here 
is little doubt that many non-federal donors welcome the 
opportunity for joint support of projects with NEH * * *. Far 
from discouraging non-federal support for the humanities, NEH 
has stimulated private philanthropy.''
    Finally, I thought the Committee would be interested in a 
progress report on the national conversation. NEH's role in the 
initiative, as a funder, has drawn to a close, and we are now 
preparing a comprehensive report to the nation. This report 
will be not so much a statistical or quantitative assessment, 
although there will be much of that in it, but rather it will 
try to convey a sense of what was said in the conversations 
that took place in the more than 140 communities in 42 states, 
the Virgin Islands, and the District of Columbia over the life 
of the initiative and what conclusions one can make about 
Americans' many thoughts and opinions about the pluralistic 
nature and identity of their nation. We will publish and widely 
distribute the report sometime this summer.
    In closing, I must return once again to the issue of money. 
While the Endowment continues to forge ahead and to think 
creatively about ways we can continue serving the American 
people, it is also true that we need sufficient financial 
muscle to bring our plans to fruition. As small as NEH's budget 
is, the Endowment is still the single largest national source 
of funding for the humanities. The Endowment's work is a 
necessity, not a luxury. Indeed, many recent studies and public 
commentaries have indicated that the private sector and 
foundations can not and will not shoulder the burden for a 
diminished NEH. Our fiscal year 1998 budget request, which is 
tailored to the plans and program emphases I have discussed in 
this statement, represents a prudent investment that a great 
nation such as ours must make in activities that support the 
unglamorous but critical task of preserving America's heritage 
and sharing it with the American people. I can think of no 
nobler purpose.

                 prepared statement of senator cochran

    Senator Gorton. Due to a previous commitment, Senator 
Cochran was unable to attend the hearing, I have a prepared 
statement which will be inserted into the record at this point.
    [The statement follows:]

                 Prepared Statement of Senator Cochran

    Mr. Chairman, I join you in welcoming Dr. Sheldon Hackney 
and I congratulate Dr. Hackney, and take this time to let him 
know we have appreciated his service as Chairman of the 
National Endowment for the Humanities. This week he announced 
his intention to return to the University of Pennsylvania to 
teach history.
    The National Endowment for the Humanities is better for his 
tenure. A scholar in history, he is sensitive to the importance 
of not only the study and preservation of our past, but making 
sure that study is modern, and that we cultivate our foundation 
for the future. The Teaching With Technology Grants, first 
awarded last year, will aid in the new development of materials 
for classroom use with state-of-the-art equipment. This is an 
important contribution to our society. We need innovative 
support such as this, in order to keep up with the technology, 
train our teachers, and prepare our students.
    This is vision. Dr. Hackney has provided excellent guidance 
and good vision. I thank him, and wish him well.

               public service and the temper of the times

    Senator Gorton. With that, Senator Bumpers, with all of 
your patience I will let you ask any questions that you have 
now.
    Senator Bumpers. Since I am the only one who has stayed 
with you?
    Senator Gorton. Yes. [Laughter.]
    Dr. Hackney. There is a metaphor there, I think. 
[Laughter.]
    Senator Bumpers. Dr. Hackney, first of all let me say that 
Mrs. Bumpers and I wish you and Lucy the very best in your 
future and to tell you that we are both deeply grieved, as I 
think most Members of Congress are, about your departure.
    Dr. Hackney. Thank you.
    Senator Bumpers. When I hear you and Jane Alexander deliver 
your opening statements this morning I am much encouraged, 
because I have become about as cynical as the rest of America 
on a lot of scores, and one is, of course, how increasingly 
difficult it is to get people to serve and to accept public 
service.
    I have done a little recruiting in my own party trying to 
find people to run, and we have been lucky to find a lot of 
really talented people, but I can tell you it is becoming 
increasingly difficult to get people to give up a reasonably 
good life with their families, good incomes and so on, and then 
come into such a hostile, meanspirited environment as this, 
where political differences are becoming criminal offenses. You 
touched on that to some extent in your opening statement, and I 
appreciated that very much.
    So under the most difficult circumstances you have done a 
remarkably fine job, and we are grateful to you for taking out 
the time in your life to accept this responsibility and do an 
outstanding job, as I see it, under very difficult 
circumstances, so we wish you the very best.
    Having said that, I have tried to plumb my own mind and try 
to figure out what is it about this Nation that must, indeed, 
be different? I am a student of American history, and yet I 
know there is much that I do not understand. I do not 
understand our culture now.
    I do not understand the hostility that people feel about 
everything, and I think that has been reduced somewhat by the 
fact that the economy is performing well, the crime rate is 
down--I think the economy plays a role in that. I hate to say 
this, but I think building prisons and locking up repeat 
offenders who have repeatedly shown that they cannot live in a 
free society has an impact.
    But I am not sure of the underlying causes of the crime, 
the sudden crime surge in this country, or the hostility and 
the meanspiritedness right here in Washington, right in the 
U.S. Congress and right in the U.S. Senate.
    The comity that existed when I came here does not exist any 
more. I was a trial lawyer, and people were always talking 
about how trial lawyers fight in the courtroom and then go out 
and have lunch together, and we did because we liked each other 
personally. It had nothing to do with the savage fight we had 
in the courtroom.
    But one of the reasons I am such a strong champion of the 
arts and humanities is because I think it plays a major role, 
and that is the reason I say if it can play a major role with 
such a small amount of money I can only guess what it would do 
if you were well-funded, and yet people--you know, we do things 
by exception around here, not the rule. Somebody can find 
Mapplethorpe or something like that and trade on it forever, 
which neglects the larger problem.
    You mentioned Tiger Woods, and I do not know, it might have 
been Charles Krauthammer in the Post the other day who was 
talking about Tiger Woods, and I agree with it. I think the 
phenomenon of Tiger Woods and the immense respect and 
admiration the American people have for him is not necessarily 
because he is African-American or Asian-American. I notice he 
used some term on the Oprah Winfrey show to cover Indians and 
everything else the other day.
    And it is not because he is a superlative golfer. My No. 1 
son, who is a golf junkie, told me a year ago that he would 
wind up being the greatest golfer in the history of this 
country.
    But you see, I still do not think that is America's 
fascination with him. I think it is his respectful attitude, 
that he speaks well, that he smiles easily, and you never see 
unbecoming conduct out of him, and when we think about him as 
an African-American or Asian-American, and you think about 
where did all this conduct in sports--when did it get so mean, 
and I do not know either.
    Ilie Nastase, Jimmy Connors, and John McEnroe were not my 
ideas of role models for this country, and they sort of made it 
acceptable to a very, what shall I say, very gullible young 
group of people in this country that it is OK to spit in the 
referee's face, the umpire's face. I will spit in his face the 
first time he crosses me. These people are role models.
    Tiger Woods understands that. I think he understands that. 
I think he is just a genuinely fine person.
    I heard one man interviewed saying I did not come to see 
him play golf. I just came because I enjoy his mannerisms and 
his conduct.
    Well, that is my lecture on incivility, which you already 
covered much more eloquently than I could.

                   summer seminars for schoolteachers

    But to go on to a more specific item, in 1988 or 1989 I 
read in Newsweek that the Carnegie Foundation was funding 
summer seminars for schoolteachers, not a math teacher to 
improve her math skills, but for teachers to learn something 
about Virgil's Aeneid, for example, because teachers, a lot of 
things fall off of teachers in the classroom other than math or 
history, whatever they are teaching, so this was the concept, 
and all of the six programs that they funded one summer were 
vastly oversubscribed.
    I thought it was a dynamite idea, because there is a simple 
principle that I adhere to and really strongly believe. That 
is, if our children are not learning it is because they are not 
being taught, and they are not going to learn as long as the 
same people who are not teaching continue not to teach.
    Now, I do not mean that to denigrate teachers. I married a 
fifth grade teacher, and so I get humility lessons every 
evening at my house on this subject. But anyway, I then began 
to try to get a bill passed to make this a giant program, as a 
part of the Department of Education in this country and got 
virtually nowhere with it.
    So since the National Endowment for the Humanities had a 
program similar to it, I then started trying to get that 
program funded at a higher level at NEH, without an awful lot 
of luck, and now my staff tells me in a memo I got this morning 
that the number of teachers who are qualifying for these summer 
seminars, and these are seminars of all kinds under NEH, has 
dropped by 50 percent. Is that due specifically to funding?
    Dr. Hackney. It is the funding level, yes.
    Senator Bumpers. Well, all I can say is, that is a mass 
tragedy. I think that program ought to be so big that any 
teacher in this country who wants to improve her skills even in 
her own discipline or something else ought to have the 
opportunity.
    The first one I saw was at the University of Texas. They 
had 244 slots, and they had 4,400 teachers apply for those 244 
slots. Do you still have that kind of response?
    Dr. Hackney. Oh, we do, yes. I think the summer seminars 
and summer institutes that we do are the very best things we 
do, the core of our programs. Seminars and Institutes, along 
with fellowships, are the two things that we do that really 
have to be done to keep the humanities alive, and they are a 
high priority for us. We protected those when our budget was 
cut. That close to 50-percent drop is occurring even though we 
have protected those two programs.
    Before 1996, before the cut, teachers who had been in an 
NEH seminar taught 500,000 students in the first year after 
their seminar experience. That is, 500,000 students every year 
were being taught by a teacher whose life had just been 
refreshed and whose enthusiasm for teaching had been renewed by 
this experience of studying for 6 weeks or 8 weeks on a college 
campus with a master of the subject.
    Our niche in this is content. It is high quality substance, 
and not pedagogy. These are all--the institutes are focused on 
curriculum and teaching materials, but the seminars, which are 
more numerous, are focused on the knowledge in that area.
    Teachers frankly do not get a chance to spend a lot of time 
thinking about or studying or reading during the year. They are 
so heavily worked in their high schools and in their colleges 
that they really need this period of being able to learn more 
and to refresh their knowledge and their enthusiasm.
    Senator Bumpers. How much money is in the summer seminar 
program?
    Dr. Hackney. That is a very good question. Let me fish that 
up quickly.
    It is about $5.7 million for seminars and institutes.
    Senator Bumpers. $9.7?
    Dr. Hackney. $5.7 million.
    Senator Bumpers. Well, that is a little more than it was--
no, wait, it is less than it was about 3 years ago.
    Dr. Hackney. Yes.
    Senator Bumpers. I thought I finally got that up to around 
$9 million.
    Dr. Hackney. We are spending now about $10 million for 
education programs in total, and that is down considerably from 
what it was previously. At the fiscal year 1998 budget request 
level of $136 million, $8.5 million is allocated for seminars 
and institutes.
    That is all because of the cut that came in fiscal year 
1996.
    Senator Bumpers. What a tragedy. I tell you, maybe that is 
another reason people do not want to come here. Maybe I should 
not pursue that.
    I have always been a great student and devotee of the 
Constitution. I agree with Arthur Schlesinger, who says it was 
put together by the greatest assemblage of minds ever in the 
history of the world. I believe that.
    I voted for one constitutional amendment since I have been 
here, and I have voted against probably 40. I hope I have the 
courage to continue to vote against them, but I am always 
troubled by how little people understand constitutional 
Government and why we are a democracy, how we are free and that 
sort of thing, and yet in this body, in the U.S. Senate 
especially, every single problem that has any emotional or 
political appeal winds up being offered as a constitutional 
amendment.
    We have only had 11,500 constitutional amendment 
resolutions, and if you take the Bill of Rights out we have 
only adopted 17, so that speaks well for Congress and the 
people of this country.
    But you know, when I think about people who have never read 
``The Federalist Papers,'' tinkering with the work of James 
Madison and Alexander Hamilton, it is so galling to me that I 
cannot tell you. It is not that the Constitution should not be 
amended, but we do not have an appreciation for it, and the 
reason we do not is because people are not being taught the 
value of it and what it means.
    And you touched on where we are, how we got here, and why 
there is this distrust and hostility toward each other. When 
you ask people, did you ever do this, did you ever do that, 
they do not know, I always tell Betty the reason they do not 
know is because nobody ever told them. That is the reason those 
summer seminars are so vitally important.
    But I am not going to pursue my sermon on the Constitution, 
but Sheldon, again, we appreciate the work you have done and 
wish you well.
    Dr. Hackney. Thank you very much.
    Senator Bumpers. Thank you, Mr. Chairman.

                      advice for next neh chairman

    Senator Gorton. Thank you, Senator Bumpers.
    Dr. Hackney, if your successor asks you for one single 
piece of advice, the most important single piece that you could 
give to him or her, what will it be? What will it be? Just one.
    Dr. Hackney. Only one. I can think of several, but I would 
say that the most important thing that my successor can do is 
to tell the story of the NEH.
    The NEH has a proud tradition 32 years long of doing good 
things for the American people. For most of those years we have 
simply assumed that because we got an annual appropriation that 
we did not need to be well-known, that we could continue to do 
the unglamorous but necessary work of keeping the culture alive 
and preserved, but it has been proven that that is not true.
    One of the things that I have been trying to do and that I 
think the humanities community in general has done a much 
better job of in the last 3 years is telling the story of the 
humanities and of the NEH to the public and to the Members of 
Congress. That is absolutely necessary in this society, so we 
need to continue to do that in dramatic ways.

                     maintaining a nonpartisan neh

    Senator Gorton. As you announced your resignation or your 
retirement from this position a number of people gave you 
credit for depoliticizing the National Endowment for the 
Humanities. At the same time, obviously one's views on the 
humanities and our history has a philosophical, a political 
philosophical context.
    Where does the balance lie in the National Endowment for 
the Humanities, that is quite broad in its charter, and the 
very real ideas that an administration that appoints it and for 
which it works has with respect to many of these ideas? How do 
you create that balance?
    Dr. Hackney. That is a really good question. There are 
senses that theorists would have that everything you do is 
ideological, because there is a sense in which it is connected 
to a view of the world and what is good and what is not good, 
but that is not what you were talking about nor what I am 
talking about.
    It is my firm belief that the NEH needs to be a domain 
clearly nonpartisan but also nonideological. It should be 
funding programs that are of very high quality and that contain 
ideas that need to be discussed by the American public. It 
needs to be balanced, in other words.
    We have a conscious rule in our public programs area that 
applies in other areas as well, which says that we do not fund 
programs that advocate a particular point of view, whose thrust 
is to convince an audience of a particular truth or a 
particular way of looking at a problem.
    Those programs must be balanced. If they are controversial 
they must contain all of the different points of view that 
pertain to that subject, and they should not be advocacy 
programs nor celebratory programs, frankly. They should be 
serious examinations of issues that are open to all of the 
points of view that are available, so I think the Endowment 
really does need to remain both nonpartisan and nonideological.

                         merging of neh and nea

    Senator Gorton. I must say, you seem to have done very well 
in creating that balance, and then following the rules that you 
outlined here, and you deserve congratulations for just that.
    Briefly, would you like to comment on the question that you 
heard me ask Ms. Alexander about the various proposals to 
combine or to consolidate the two Endowments?
    Dr. Hackney. Surely. The NEA and the NEH serve very 
different constituencies and audiences. We operate in different 
ways, and putting them together would be quite awkward, so I do 
not see that it is going to solve any problems.
    I agree with Ms. Alexander that we have been thinking about 
how we might combine support functions, for instance, and save 
money, but we have not been able to identify any significant 
savings that way.
    Frankly, I also would worry that in any combined agency--a 
cultural agency that funded both the arts and the humanities--
that over time, even with good intentions, the humanities would 
drift toward the bottom of the priority list because we are 
inherently less glamorous. What we do is less visible. The 
people who do it are less visible. They are not celebrities, by 
and large. There is an occasional Doris Kearns  Goodwin who 
wrote the bestseller on the Roosevelt White House during World 
War II.
    Senator Gorton. You do not get quite as much ink as Ms. 
Alexander, do you?
    Dr. Hackney. Exactly right. Now, I am not sensitive on the 
subject. [Laughter.]
    She deserves it. This is not the first hearing in which 
everyone has left after she got up. [Laughter.]
    But I think that actually is inherent to areas of life. The 
arts are in part performances. They are individuals performing 
for a public. Entertainment is not a bad word, because 
entertainment makes you think and gives you a different view of 
life. It is very worthy material, but it is very different from 
what the humanities do.

       state humanities councils compared to state arts agencies

    Senator Gorton. I suppose is that not reflected in the 
rather different structure of States humanities councils and 
your relationship with them as against the arts? Is it not true 
that many or most of them are not official State agencies, even 
though some get support from the States?
    Dr. Hackney. Some get support. None of them is a State 
agency, though. They are all 501(c)(3) organizations, and I 
think the different levels of funding for the arts from the 
States as compared to what humanities organizations get from 
States is a measure of the different level of visibility and 
glamour.
    Senator Gorton. So in other words the State support for 
them is far lower than it is for the States arts councils?
    Dr. Hackney. Much lower, yes.
    Senator Gorton. Does that mean that your encouragement and 
the funding that you have is more significant or at least is 
very significant in preserving and enhancing those States 
humanities councils?
    Dr. Hackney. Oh, yes; I think so. One of the things I am 
most proud of in my tenure at the NEH has been that we have 
transformed the relationship between the State humanities 
councils and the NEH.
    Senator Gorton. Why don't you describe that for us?
    Dr. Hackney. Traditionally, our office that managed our 
relationship with the State humanities councils operated as if 
it were a grantmaking program. State councils applied to us for 
an annual grant. Even though there is a formula in our 
authorizing legislation that describes how much is to be 
distributed to the States and a formula for distributing it, we 
still behaved as if it were a grant, and there was an oversight 
function that was quite rigorous.
    As State humanities councils have matured over the last 20 
years--they started in the early 1970's--they have gotten quite 
significant. They do very good work, high quality work, and we 
have now begun to think of them as our frontline, if you will, 
our local affiliates, bringing the humanities in a different 
way to local populations.
    We have begun to divide up the territory a little bit, to 
divide the labor. We have also dramatically cut the size of our 
office and renamed it. It is now the Office of Federal/State 
Partnership. It is much smaller.
    It is not a grantmaking operation. We are in the midst now 
of redefining and redesigning with the State humanities 
councils the accrediting function, if you will, the oversight 
or quality control function. That will be very different from 
what we did before.
    The relationship is good. Communications are good. I am 
really pleased with it.

              neh and american heritage rivers initiative

    Senator Gorton. On another subject, you may be involved in 
an area that can be highly controversial, and it may or may not 
have been without your conscious early participation.
    In his State of the Union Address President Clinton 
announced a new American heritage rivers initiative. The Chair 
of the Council on Environmental Quality talked about particular 
communities being targeted to receive Federal assistance and so 
on that would come from brownfields money, farm bill money, and 
the two national Endowments.
    I can tell you in many parts of the country, like mine, 
this kind of proposal creates a great deal of fear of another 
set of Federal agencies coming in to tell people how to live 
their lives. I hope that is not true, but can you tell me, were 
you part of the original planning? Are you a part of it now?
    Supposedly the various Federal agencies were to report back 
to the President within 90 days on more detailed plans. Can you 
tell me anything about those plans and your participation in 
them?
    Dr. Hackney. We were one of 25 Federal agencies that were 
invited to plan this project, which as I understand it is an 
effort to coordinate the various programs run by Federal 
agencies in designated areas. It has not been completely 
designated yet, so our participation, or our role here is 
simply to do what we normally do, but to communicate perhaps a 
bit more effectively with other Federal agencies so that our 
programs can mesh with theirs more.
    We support some projects that are particularly designed for 
river areas. One that I remember with great affection was 
actually supported by my predecessor but was very effective. It 
was called always a river.
    It was a grant to six State humanities councils to put a 
historical exhibit on a barge on the Ohio River and float it 
down--West Virginia, Ohio, Pennsylvania, Illinois, Indiana, and 
Kentucky were involved in this--the river, stopping, obviously, 
now and then, tying up to the local docks and inviting people 
from that community on to see a really exciting exhibit of the 
cultural history of that river area.
    Well, we support projects like that. We do those through 
our regular grant process and will continue to do them.
    Senator Gorton. Well, no one is going to be anything other 
than pleased at that kind of activity, but do you know anything 
at this point about the progress of this American heritage 
rivers initiative project?
    Dr. Hackney. I think it is going forward, and we are 
involved in the groups that come together to discuss it.
    I think the plans are to designate some of the areas within 
which coordination is to take place. It is coming soon. Let me 
turn to my deputy and see who has been represented.
    September 1 is apparently the date on which the first five 
river areas will be designated.
    I should say there are no new funds going to this program, 
as I understand it, certainly no new funds from us or, as I 
understand it, from the other Federal agencies.

                   national trust for the humanities

    Senator Gorton. Thank you. We will look forward to 
September 1.
    Tell me about the National Trust for the Humanities. Do you 
think that this will be a successful way of getting additional 
private sector funds, and what will its relationship be with 
NEH?
    Dr. Hackney. I do think it will be a significant factor in 
making our programs much more available to the public than now.
    The National Trust for the Humanities is a 501(c)(3) 
organization that is chartered here in the District. It is up, 
organized, and running now but does not yet have a staff. It 
already has raised a little modest money.
    Its directors are people interested in the humanities from 
around the country. We are not doing this. We are not directing 
it. It is an independent organization. It is one of the ways in 
which the humanities community must operate in a different mode 
in the future. It will be able to attract private funds and be 
the partner in any partnership that handles the money for 
programs.
    One can imagine the national trust raising funds that 
would, for instance, put in every high school in the country a 
collection of the films, the documentary films that NEH has 
made possible, or has funded over the years. Most of them, 
except for the Ken Burns films and other super successful ones, 
are now sitting on someone's shelf gathering dust, not doing 
anyone any good, when they are extraordinarily valuable as 
educational tools. We do not have the money now within our 
appropriation to give them away.
    One of the projects that I think the national trust might 
undertake is raising private funds either from corporations 
that might want to have their name attached to that sort of 
effort, or from a philanthropist or foundations to purchase and 
send packages of those films to schools throughout the country. 
In that way I think they can find new audiences, and extend the 
audience for work that we are already doing.
    It is important to realize, though, that if the national 
trust is wildly successful, in my view it will be raising $3, 
$4, $5 million within 5 years to sort of supplement the work of 
the NEH. It can never replace the funds that come from the 
Congress.

                     Additional committee questions

    Senator Gorton. Dr. Hackney, I want to thank you for your 
testimony. We have a number of other questions that we will 
submit to you in writing about specific programs, and would 
appreciate your answer to them.
    I think you have done great credit to the Endowment during 
very difficult times, and for, I believe, the entire 
subcommittee and, I hope, the Senate I want to thank you for 
your service. I realize it has a few more months left to go. 
You have been most eloquent, and I do look forward to reading 
your philosophical comments.
    Dr. Hackney. Thank you. I do want to say, Mr. Chairman, not 
only that I appreciate your support through the years here, but 
this service to me has been the most exciting and rewarding 
experience of my professional life, so I do not regret coming.
    Senator Gorton. That is wonderful. Thank you.
    [The following questions were not asked at the hearing, but 
were submitted to the Endowment for response subsequent to the 
hearing.]

                     Additional Committee Questions

                           budget priorities
    Question. $136 million has been requested by the President for NEH 
activities in fiscal year 1998. However, it is doubtful that the 
subcommittee will be able to provide the agency with an increase over 
the fiscal year 1997 budget. If this is the case, would you advocate 
that the appropriation of funds remain the same for the various budget 
lines for grant divisions, state programs and administration?
    Answer. Yes.
    Question. Or do you see a need to allocate the resources 
differently, and, if so, how and why?
    Answer. If the fiscal year 1997 appropriation is again $110 
million, the fiscal year 1996 breakdown is a good distribution of 
funding among our budget lines.
                   state humanities councils funding
    Question. All 56 state humanities councils are non-profit, private 
organizations, not state government agencies. However, according to 
information provided in the fiscal year 1998 budget request, almost 
half of state councils do receive some state support in addition to 
federal dollars.
    Does the National Endowment in any way provide a financial 
incentive for state governments to contribute to the work of the state 
councils?
    Answer. In addition to an outright grant--which by law comes with a 
50 percent cost-share requirement--NEH awards each of the councils 
supplementary matching funds for the purpose of leveraging non-federal, 
third-party contributions. Any funds that the councils receive from 
state governments can be used to satisfy the fund-raising requirement 
that these NEH matching grants entail. Thus, by contributing to the 
councils, state governments can help them leverage additional federal 
support.
    Question. Are state contributions, or the lack thereof, a 
determining factor in the apportionment of federal dollars to local 
humanities councils?
    Answer. No.
    Question. What factors can you point to that would explain why over 
one half of the state humanities councils do not receive state support? 
Why do you believe such a disparity exists between the state humanities 
councils, which receive approximately $4 million annually, and state 
arts agencies that receive an estimated $265 million yearly in state 
support?
    Answer. Historically, the arts councils have been state government 
agencies, while the state humanities councils have remained private, 
non-profit organizations. The arts councils have been the primary 
vehicle by which the states channel support to the arts. State 
governments have typically chosen to support the humanities councils on 
an ad hoc basis, through project grants and special appropriations. In 
recent years, the state councils' efforts to attract state government 
support have met with increasing success. Moreover, state support for 
the humanities is at least as great as what they provide for the arts. 
For example, total state support for public education at all levels now 
exceeds $150 billion annually, some not-inconsiderable part of which 
supports teaching and scholarship in history, literature, government, 
philosophy, and other humanities subjects and disciplines.
    The legislation that governs NEH support of the state humanities 
councils provides that state governments are to be given the option of 
either: (1) designating the existing private council as a state agency, 
then matching 50 percent of the federal minimum grant or 25 percent of 
the total federal outright grant, which ever is larger, and 
reconstituting the council membership with gubernatorial appointees; or 
(2) appointing six members to the existing private council, or a 
maximum of 25 percent of its membership. Each year, the Endowment 
informs each state governor of the state's option to convert the 
existing council into a state agency. To date, no state has chosen to 
designate a humanities agency, even though several now provide their 
council more than 50 percent of the Endowment's Federal/State 
Partnership grant.
    Question. Individual state humanities councils can fund no more 
than one-half the cost of any one project, with the remainder coming 
from local contributions. If the states were to receive a larger 
percentage of the total amount Congress appropriates to the NEH for all 
humanities programs, including state councils, what is the likelihood 
that local resources could be raised to meet the necessary increased 
matches? At what point, because of limited local funds, will federal 
support fail to be a catalyst for raising matching funds?
    Answer. The state councils and the organizations and individuals 
they support can match the outright grant funds awarded through the 
Federal/State Partnership with either cash or in-kind contributions. In 
addition to third-party contributions, costs incurred by the project 
sponsors themselves are counted toward this matching requirement. In 
recent years, the imputed value of all cash and in-kind contributions 
to the state councils and the recipients of their project support has 
exceeded the required 50 percent cost-share by approximately $18 
million.
    The state councils are not unique in this respect; all NEH grantees 
contribute a share toward the costs of their project that, on average, 
amounts to $1.30 for each federal dollar of their grant. The potential 
contributor response to additional federal funding for the humanities 
is very large in all areas that the Endowment supports. But, the funds 
now provided through the Federal/State Partnership are sufficient to 
permit the councils to support more than half of the funding proposals 
they receive, while NEH must turn away five of six of its grant 
applicants.
                          office of enterprise
    Question. This office was formed in recent years to extend and 
expand the Endowment's assets and to facilitate its work in a more 
entrepreneurial manner. It has been given responsibility for seeking 
new financial resources, as well as sponsoring all projects that cross 
over divisional lines within the agency.
    Can you tell us how successful this office has been in 
accomplishing its mission to date? What strides have been made since 
its creation and how is its work stretching available federal dollars?
    Answer. The Enterprise Office, in its first full year of operation, 
has been highly successful. The Enterprise Office developed two major 
financial partnerships--one with the Mellon Foundation and one with the 
MCI Foundation. Combining $1.25 million of NEH funding for each of two 
years with $2.5 million of Mellon Foundation support for each of two 
years will enable nine research centers throughout the country to 
support a significant number of fellowships. Funding for research 
centers and fellowships was cut sharply as a result of the budget 
reductions in fiscal year 1996, and this renewed commitment will help 
to continue the critical work of research to create new knowledge in 
the humanities.
    Under the auspices of the Enterprise Office, the MCI Foundation and 
NEH formed a partnership to create EdSiteMent, a new website designed 
to help teachers, parents, and students find the best education 
websites on the Internet. MCI's commitment of $500,000 to this project 
represents the first corporate partnership for NEH, and we expect to 
build upon that success in coming years.
    In addition, the Enterprise Office has worked with other NEH 
divisions to extend the reach of Endowment projects. This includes 
creating new exhibit space in the Old Post Office Pavilion to showcase 
previously funded NEH exhibits to the more than 3.5 million people who 
visit the building each year. In addition, the Enterprise Office has 
provided a modest amount of funding to enable these exhibits to travel 
to places in the country where the exhibits have not previously been 
seen. Plans are underway to extend this initiative to major NEH-funded 
exhibits so that more Americans will have access to the rich historical 
information embodied in these exhibits.
    Finally, the Enterprise Office has provided support for major 
proposals coming to NEH that do not fit neatly into one particular 
division, but that would make a major contribution to the advancement 
of the humanities. This includes the Disaster Recovery Kit, a kit 
designed to provide critical information to museums, libraries, and 
educational institutions about the steps that need to be taken 
immediately to preserve books and other important cultural materials in 
the wake of natural disasters like floods, fires, and hurricanes.
    Question. Are new collaborative efforts with partners such as the 
Mellon Foundation and MCI the result of efforts by this office? Please 
describe these cooperative arrangements in greater detail for the 
subcommittee.
    Answer. The partnerships formed with Mellon and MCI were the result 
of a collaborative effort between Enterprise and another NEH division. 
The Mellon partnership began with discussions between the NEH Chairman 
and the director of NEH's Division of Research and Education about what 
could be done to support critical research in the wake of the 60 
percent reduction in research funding as a result of the fiscal year 
1996 budget cuts. Mellon was encouraged to make a major financial 
commitment with the assurance that NEH would also make a commitment to 
support research centers. NEH funds are provided directly to research 
centers as are Mellon funds.
    The MCI project began with an inquiry from MCI to Enterprise about 
how we might combine the technological expertise of MCI with the 
education expertise at NEH to improve education in the classroom. As a 
result of these discussions, NEH put together a proposal for 
EdSiteMent, a new Website to identify the best education websites on 
the Internet. The MCI's commitment of $500,000 is being used to support 
the new website, create teacher guides for use in the classroom, and 
for partnership efforts with schools to incorporate EdSiteMent into the 
classroom. As part of its contribution to the partnership, NEH used its 
rigorous peer panel review system to evaluate the quality of websites 
and make recommendations for inclusion on EdSiteMent.
     Question. How much of the $12,416,000 appropriated to the Division 
of Public Programs and Enterprise in fiscal year 1997 is designated or 
anticipated to be used specifically for Office of Enterprise 
activities?
    Answer. Including the $1.25 million commitment to the Mellon 
Foundation partnership, the fiscal year 1997 budget for the Enterprise 
Office is $2.138 million.
                        humanities in education
    Question. Traditionally, the humanities have been considered part 
of a core educational curriculum for students. Do you believe this is 
still the case or has there been a decline of interest in studying the 
humanities today? How does NEH attempt to convey to students the 
relevance of a liberal arts education in an increasingly technology-
oriented world? Is there greater emphasis now on vocational or pre-
professional degrees than in the past?
    Answer. The data we have--both empirical and anecdotal--indicate 
that interest in the humanities among college students is on the rise 
after a long period of decline. The number of bachelor's degrees 
conferred in humanities disciplines has rebounded sharply from the low 
levels seen in the 1970's and 1980's. A similar resurgence of interest 
is being seen in the nation's graduate schools, where the number of 
students pursuing advanced degrees in the humanities has been moving 
upward since the late eighties. Some of the new interest may have been 
fueled by an expansion of general education (or ``core'') requirements 
by a significant number of American institutions of higher education. 
More often than not, general education includes a healthy dose of 
humanities subjects.
    Through our programs and through our rhetoric, we attempt to convey 
to students the importance of sustained, thoughtful study of the 
humanities. Such study is the foundation for understanding important 
contemporary issues as well as enduring questions of human existence. 
The humanities raise issues that are central to life in a democratic 
society and provide resources for engaging issues with intelligence and 
wisdom. Quite simply, our message is this: While vocational, 
technological, and pre-professional education help prepare students for 
their first jobs, a humanities-centered education prepares students for 
a lifetime of many different jobs.
    Question. Alternatively, turning to the other side of the desk, 
what progress has the Endowment made in fostering the development of 
better teachers, as well as attracting qualified, committed candidates 
to this important profession?
    Answer. Over the course of its history, one of the primary missions 
of the National Endowment for the Humanities has been to help school 
and college teachers in the United States improve their teaching of the 
humanities. Particularly noteworthy are the grants the Endowment makes 
annually in its summer seminars and institutes program, the country's 
leading faculty development program in the humanities, which are 
designed to provide school teachers and college faculty members with 
opportunities to study fundamental texts and significant topics in the 
humanities. Each year, the hundreds of humanities teachers who attend 
NEH-sponsored seminars and institutes return to their home institutions 
intellectually revitalized and thus more effective instructors of the 
tens of thousands of students who fill their classrooms.
    NEH humanities education grants are not designed, per se, to 
attract new teachers to the humanities. We suspect, however, that there 
may be instances where a student becomes interested in pursuing a 
teaching career in the humanities as a result of having been exposed to 
an instructor whose teaching had been reinvigorated after attending an 
NEH seminar or institute.
    Question. What, if any, role does the U.S. Department of Education 
assume in serving to encourage and enhance instruction in the 
humanities in our schools? How much do their funding and programs 
complement the kinds of work you support for teachers and students?
    Answer. The Department of Education provides support for humanities 
instruction in two main areas: ``Goals 2000,'' which encourages efforts 
at the state and local level to establish high academic standards in 
the core academic subjects (the humanities among them); and the 
Eisenhower Professional Development Program, which assists state and 
local education agencies with efforts to enhance the professional 
development of teachers.
    NEH's education programs complement but do not overlap with those 
of the Department of Education (ED). We provide a modest amount of 
support for materials and curriculum development in humanities subjects 
(for which there is no ED analog), and we support the professional 
development of humanities teachers by providing them with opportunities 
to engage in intensive summer study of important texts and topics in 
the humanities. Although at first glance it might appear that there is 
substantial overlap between the two agencies' teacher training 
programs, they are in fact quite distinct. The Department's Eisenhower 
program differs from NEH's offerings in two key respects:
    (1) Eisenhower is for the most part a formula-grant program that 
permits significant flexibility among states and localities in the 
design and execution of teacher training programs. What this means in 
practice is that professional development opportunities are relatively 
short in duration (often a week or less) and focused on pedagogical 
rather than substantive concerns. NEH's seminars and institutes, on the 
other hand, offer teachers in-depth study opportunities lasting four to 
six weeks. Such programs are led by many of the nation's top scholars 
and are focused on content rather than pedagogy.
    (2) Although the Eisenhower program nominally targets all core 
subject areas, the program's funding mechanism in fact favors math and 
science education. Eisenhower's enabling legislation includes a trigger 
mechanism that has the effect of reserving the first $250,000,000 of 
the annual appropriation for math and science training. For fiscal year 
1997, this has meant that a relatively small sum remains for all other 
subjects. Conversely, all NEH funding is reserved for professional 
development in humanities subjects.
                  teaching with technology initiative
    Question. The initial funding proposal for this three-year 
initiative was $4 million in the fiscal year 1996 budget request. 
Congress was unable to fund this increase, but the initiative moved 
forward without the requested dollars. Was the program scaled back from 
the original plans when funds were not appropriated, or was the $4 
million found from among NEH's existing programs? What other programs 
were reduced in order to advance this effort? What accomplishments can 
you point to?
    Answer. The fiscal year 1996 NEH budget submission to Congress 
included a request of $4 million in funding for a ``Technology and the 
Humanities'' special initiative. The purpose of this special request 
was to enhance the Endowment's ability to make humanities resources and 
programs more available and accessible on the developing digital 
information superhighway; the initiative was also designed to include 
all of the agency's major program areas--preservation, education, 
research, and public programming. However, when Congress ended up 
slashing NEH's budget by 36 percent below fiscal year 1995, it 
effectively cut off any possibility of fully implementing the agency-
wide ``Technology and the Humanities'' initiative.
    The Endowment was intent on trying to salvage at least one 
component of the initiative, albeit with considerably scaled down 
funding, and in fiscal year 1996 we announced that we would support 
``Teaching with Technology'' projects within our humanities education 
grant programs. At the first ``Teaching with Technology'' grant 
deadline, we received more than 300 proposals but were limited, because 
of severe budget constraints, to making only 12 awards despite the fact 
that the overall quality of the proposals was so high that we could 
easily have funded four times this number. Included among these first 
grants were such ``accomplishments'' as a project at Northwestern 
University to develop and deploy a database on the Internet on the 
history of the U.S. Supreme Court, a project at Miami University in 
Ohio that is helping teachers of Latin use electronic resources in 
their classrooms, and a project at the University of Virginia involving 
the use of CD-ROM's and the Internet to teach the history of the 
American Civil War.
                          follow-up initiative
    Question. The Teaching with Technology initiative has led to the 
development of another new three-year initiative that will be offered 
by NEH. This project will help schools and their teachers become 
competent and comfortable with newly developed electronic materials and 
the technologies with which to teach with them. Specifically what will 
this training program do and how much will it cost? To what degree do 
you anticipate that the emphasis will necessarily be on familiarizing 
teachers with basic computer technology? How will you assure that the 
humanities receives an appropriate focus in this initiative?
    Answer. The aim of the Endowment's follow-up to the Teaching with 
Technology initiative--``Schools for a New Millennium''--will be to 
jump start the process by which schools and their teachers become 
competent, and comfortable, with new humanities materials and 
technologies. The extent to which schools and teachers are proficient 
in using electronic materials and formats will directly affect the 
level of student learning and achievement. Projects to be supported 
under this new initiative would: involve a whole school and require 
commitments from teachers, the principal, and the Parent-Teacher 
Association; leverage public-private funding partnerships and establish 
links with parents, local colleges, and universities; focus on 
challenging substantive questions in the humanities that could be 
addressed by the use of rigorous interactive educational software; 
support hands-on training for a school's teachers and provide enough 
time to develop both confidence with the technology and the materials 
and to create challenging and engaging classroom uses that would enrich 
the school's curriculum; and exploit the potential of the Internet not 
only to link participants in a single project but also to trigger rapid 
fire, nationwide dissemination and participation. At the Endowment's 
$136 million fiscal year 1998 request level, we estimate that about $2 
million would be set aside for these types of technology projects.
    While the thrust of these projects will be to help teachers and 
schools integrate rich, high quality humanities materials in digital 
formats into their classrooms, we anticipate that some projects also 
may also involve some effort to developing some teachers' computer 
skills. We are confident, however, that ``the humanities'' will be the 
focus of the initiative: Because the Endowment requires all applicants 
to describe in detail the humanities content and significance of their 
projects in their grant applications, projects that are not thoroughly 
grounded in the humanities would not, and could not, receive support 
from NEH.
    Question. Is there any broad-based effort that NEH is aware of to 
assist teachers who are less skilled technologically than the students 
they teach? Is this a widespread problem?
    Answer. We are only aware of one such effort: the 21st Century 
Teachers initiative, which is part of President Clinton's Call to 
Action for American Education in the 21st Century. Under this 
initiative, the National School Boards Association, the National PTA, 
the National Education Association, the American Federation of 
Teachers, and many other business and professional organizations are 
recruiting thousands of teacher volunteers, each of whom will work to 
improve his or her own understanding of education technology and will 
then share his or her expertise with at least five colleagues in the 
coming school year.
    Providing state-of-the-art technological training for teachers 
remains a significant challenge for the nation. A recent survey found 
that only thirteen percent of public schools required that teachers be 
trained in advanced telecommunications. And although thirty-one percent 
of schools reported that incentives were provided to encourage teachers 
to obtain such training, another fifty-one percent indicated that it 
was left up to teachers to initiate participation in this kind of 
training.
    Question. Approximately one-half of our public schools have 
computer access, according to a recent estimate, with many more to be 
added in the near future. For those students who have computer 
availability, a wide array of information is readily available. In the 
meantime, is the student population without access to computer 
technology being left at a significant disadvantage academically? Is 
this an area of concern? Or, in the case of humanities studies, are 
traditional methods equally effective in teaching students?
    Answer. With technological change occurring at such a rapid pace, 
and with schools being wired and equipped at an equally vigorous rate, 
it is difficult to know for how long any one population of students 
will be disadvantaged by lack of access to a particular kind of 
technology. For the humanities, however, these issues are secondary--
technology will always be a handmaiden to content. The thoughtful 
teaching of significant texts will remain students' primary access to 
the humanities' enduring themes.
                        american legacy editions
    Question. Among the special initiatives included in the budget 
request is the American Legacy Editions, a special competition designed 
to help complete more than fifty ongoing scholarly editions of the 
collected writings of U.S. presidents and other major American 
historical and literary figures. The Editions projects have been a core 
part of NEH programs since the Endowment was created. How does this 
initiative differ from the traditional program?
    Answer. The American Legacy Editions initiative is intended to give 
a chance of survival and completion to a number of scholarly editions 
projects, the dismantling of which for lack of money would constitute a 
national tragedy. These include documentary editions of the papers of 
U.S. presidents, as well as prominent writers and others who influenced 
the course of our history or the content of our culture. Due to 
insufficient funds, it now appears likely that the Endowment this year 
will turn down a number of major editing projects that have been funded 
for many years. Moreover, to stretch our scarce funding as far as 
possible, of the editions projects we will be able to support, we have 
to cut project budgets sharply, to the bone in some cases.
    The initiative would provide approximately double the amount of 
funding we are now able to devote to these projects plus set up 
innovative financial arrangements to get more bang for our buck: i.e., 
by making extensive use of offers of matching funds, by building in 
incentives for technological innovation and speedy progress, and by 
providing flexible financial arrangements such as depletable 
endowments, NEH hopes to make possible an alternative to the shameful 
cultural tragedy that now looms.
    Question. The Division of Research and Education, through which 
this initiative would be funded, is proposed to receive a $9 million 
increase in fiscal year 1998. Current funding for the editions program 
is approximately $1.5 million. Is a portion of the requested increase 
targeted for the American Legacy Editions and, if so, how much?
    Answer. About $3.5 million would be set aside for ALE projects 
within the Endowment's fiscal year 1998 request of $136 million.
    Question. How much support would it require to get these projects 
on sound financial footing? Without an increase for the editions 
project in fiscal year 1998, what can be accomplished? Can the program 
survive as it is currently defined and at current funding levels?
    Answer. If the initiative were continued at the proposed requested 
funding level for the next ten years, we estimate that all current 
projects could achieve sound financial footing that would significantly 
reduce their need for continued NEH support.
    The initiative is tied to the Endowment's $136 million request 
level. If the Endowment's budget were held at the current $110 million 
level or at an amount that is significantly lower than $136 million, we 
would only be able to provide grants to a small fraction of these 
projects. Because most projects rely on continued NEH support, many of 
those that do not receive grants may be forced to curtail their 
operations dramatically or to close down their projects entirely.
    An alternate funding strategy NEH might adopt would be equally 
untenable: that is, to provide only nominal funding to keep as many 
projects as possible alive. This approach would mean that many American 
Legacy Editions would have to cut back on their work, which would 
significantly slow the completion of their projects.
    Question. Have other financial resources in addition to the 
Endowment traditionally been available to support the program and could 
greater responsibility for program funding be sought there?
    Answer. Another traditional source of funding for these projects 
has been through the National Historical Publications and Records 
Commission (NHPRC) at the National Archives. Like NEH, however, NHPRC's 
budget is limited and the program must support other worthy activities 
and projects in addition to scholarly editions.
                            cultural tourism
    Question. Cultural tourism has been promoted as a means to provide 
opportunities for the traveler to experience and learn about the 
history, culture and the people that give a place its distinctive 
character. Both the Arts and Humanities Endowments, as well as the 
Institute of Museum Services, have demonstrated interest in promoting 
this effort.
    NEH has committed staff and invested $50,000 in a broad-based 
national initiative that is meant to foster cultural heritage tourism 
partnerships throughout the United States. Would you please describe 
for the subcommittee the specifics of this program. How does it work 
and what do you hope to achieve? How do you believe this program will 
help to advance the humanities? Do you intend to commit additional 
funds to this initiative in the future?
    Answer. Since September 1994, an informal interagency working 
group, composed of staff members from NEH, NEA, the President's 
Committee on the Arts and the Humanities, and the Institute of Museum 
and Library Services, has been exploring means by which cultural 
organizations might assume a more active and visible presence in the 
nation's travel and tourism industry. Particular emphasis has been 
placed on identifying an appropriate role for the federal cultural 
agencies in this effort. It is our hope that by involving such agencies 
in the work of the cultural tourism industry, the arts and humanities 
can become a central and meaningful part of many travelers' 
experiences.
    This effort got underway in earnest in the spring of 1995, when 
more than thirty humanities, arts, and historic preservation 
organizations joined with the agencies to plan for a visible presence 
of cultural tourism at the White House Conference on Travel and Tourism 
that was to take place later that year. This alliance helped develop 
and distribute a position paper on cultural tourism for the conference, 
arranged for Garrison Keillor to speak at one of the main conference 
luncheons, and planned ``Culture and Commerce: Partners in Tourism,'' a 
cultural tourism ``debriefing'' held following the conference.
    Largely as a result of the interagency group's efforts, the final 
report from the White House conference included as its fourth 
objective, ``to preserve our natural historic and cultural resources 
for future generations ... through a national strategy for fostering 
environmental and cultural travel and tourism.'' The report also 
recommended the convening of ``Natural and Cultural Regional Summits'' 
to identify policy and management strategies to meet the unique needs 
of each region of the country.
    Stemming from the recommendations of this report, and with support 
provided by the cooperating federal agencies and by interested parties 
at the national and local levels, a series of regional forums have been 
conducted at sites across the country. More than sixty organizations 
and government entities have contributed funds in support of these 
meetings, ranging from Ford Motor Company to the Western Museum 
Association. To date the forums have drawn approximately 1,000 
participants, whose work has led to the development of specific action 
plans to advance cultural heritage tourism in nearly every state.
    At this point the Endowment has committed no further funding to the 
cultural tourism effort, as the initiative has now acquired a momentum 
of its own. We remain ready, however, to provide encouragement and 
guidance to groups agents who seek to extend the reach of cultural 
tourism.
    Question. According to your brochure on the economic impact of NEH, 
the U.S. travel market is experiencing a dramatic growth in cultural 
tourism, fueled in part by the Endowment. Is the travel market itself 
contributing to these projects? Are state and local governments?
    Answer. As mentioned in the answer to the previous question, a 
variety of public and private entities are contributing to the cultural 
tourism initiative. The regional summits, for example, drew substantial 
support from corporations (among them BellSouth, Ford Motor Company, 
and Ameritech), state and local tourism offices (including Maryland, 
Indiana, Colorado, Texas, and Wyoming), cultural organizations (among 
them the Historic Landmarks Foundation and the Colorado Historical 
Society), and the travel industry itself (United Airlines and Travel 
and Leisure magazine, for example).
                       other special initiatives
    Question. A good number of special initiatives are listed 
throughout the 1998 budget request. Given the decline in available 
dollars, how does the Endowment attempt to strike a balance between 
crucial support for continuing core programs and new special 
initiatives? What can be achieved by diverting funds to a special 
initiative that can not be achieved through the usual grant channels?
    Answer. Considering the current budgetary climate, it is indeed 
difficult to strike a balance between funding core programs and 
launching new initiatives. Yet despite our funding situation, the 
Endowment is determined to remain a vital national proponent and leader 
in the humanities and to continue searching actively for ways we can 
better serve the American people. The various special initiatives and 
program emphases detailed in the fiscal year 1998 budget request are 
designed to address specific needs and new opportunities in the 
humanities.
                        preservation and access
    Question. The Division of Preservation and Access was provided with 
a funding level of $18,000,000 in fiscal year 1997. Among the functions 
for which this division has responsibility is a significant effort to 
preserve brittle books, archival collections, newspapers, and the like, 
as well as to fund projects that provide the tools for increased access 
to the humanities--the creation of dictionaries, atlases, 
encyclopedias, and other reference works, as well as digitization 
programs.
    The effort to microfilm brittle books and the U.S. newspaper 
microfilm program are both significant undertakings of this division. 
Approximately how much of the total $18,000,000 appropriation for this 
division is dedicated to these projects?
    Answer. The Preservation and Access division supports a variety of 
projects that are designed to help address the preservation problem in 
the United States. Because of variations in the sizes and grant periods 
of these different kinds of projects, the proportion of the division's 
funding that is obligated for them tends to fluctuate from year to 
year. Funding for projects to microfilm brittle books and U.S. 
newspapers, for example, typically accounts for about 35 percent of the 
division's funds, but in fiscal year 1997, these projects will receive 
about 21 percent of the Preservation and Access budget.
    Question. Are significant inroads being made with this preservation 
work?
    Answer. Yes. Over the years, NEH grants have helped preserve on 
microfilm more than 750,000 of the projected 3 million important 
brittle books that are targeted for preservation in American libraries 
and archives. Substantial progress has also been made in the nationwide 
effort lead by NEH to identify, catalog, and microfilm historically 
significant American newspapers: records for approximately 127,500 
newspaper titles are now available in a national data base accessible 
through computer terminals at more than 22,600 institutions in the U.S. 
and abroad, and 55 million newspaper pages have been microfilmed that 
would otherwise have been lost to future generations.
    Question. Do the state councils place an emphasis on preservation 
at the local level or is it more of a national effort?
    Answer. No, the state humanities councils are concerned primarily 
with public programming in the humanities in their states; they do not 
support nationally significant preservation projects like those funded 
through NEH. In fact, the Endowment is the acknowledged leader in 
national effort to preserve deteriorating books, documents, 
periodicals, artifacts, and other materials that collectively make up 
an essential part of our country's cultural inheritance. Only a truly 
national entity like NEH can provide the coordinated leadership and the 
level of funding that are needed to ensure that historically 
significant materials are identified and preserved and that there is no 
wasteful duplication of effort, which would occur if a more 
decentralized mechanism were used.
    Question. Approximately one-fourth of the funds for this division 
are dedicated to the National Heritage Preservation Program, which 
facilitates the preservation of material culture objects. Given the 
broad range of important activities that comprise this division, this 
appears to be a significant funding emphasis. Is the interest expressed 
by applicants for this program larger than other program categories in 
the division?
    Answer. Applicant interest in the NHP program is strong but not 
necessarily larger that other preservation activities. We believe, 
however, that the proposed distribution of funds among all the division 
efforts is the best use of the limited funding available.
    Question. What types of awards are made to preserve material 
objects? Do you provide funds to preserve or restore the objects 
themselves or the environment in which they exist?
    Answer. Through the National Heritage Preservation program, the 
Endowment helps support the efforts of American museums, archives, 
libraries, and other repositories to stabilize material culture 
collections that are important to the humanities. This support may 
include improvements in the housing and storage of the collection; the 
improvement of environmental conditions; and the installation of 
security, lighting, and fire-prevention systems. Under this program, 
NEH does not support the restoration or preservation of the objects 
themselves.
    Question. ``Slow Fires: On the Preservation of the Human Record'' 
is a documentary film, made with NEH assistance, that focuses on the 
crisis of preservation. Its purpose is to help raise nonfederal support 
for substantial costs involved in preserving endangered materials. 
According to the budget presentation, this film has been viewed by a 
large audience both here and abroad. Please describe what, if any, 
impact the film has had on fund raising efforts in this area, to date. 
In your experience, is the private sector a generous supporter of 
preservation work, or is this an activity where federal funding is more 
critical than some others?
    Answer. While we cannot document a direct cause and effect 
relationship between ``Slow Fires'' and ``fund raising efforts,'' there 
can be no question that a consequence of increasing public awareness of 
the preservation crisis is to encourage greater support for 
preservation.
    The Endowment itself has played a direct role in stimulating 
nonfederal funding for preservation, though. Since the establishment of 
NEH's Office of Preservation in 1986, projects supported by the 
Endowment have leveraged over $10.9 million in gifts from private 
donors and foundations. Moreover, the division's grants in the last 
three years generated cost-sharing from grantees totalling $41.6 
million. Essentially, however, through NEH the federal government is 
providing vital funding and national leadership in an area where 
private sector or other nonfederal support is limited.
                                 ______
                                 

             Questions Submitted by Senator Robert C. Byrd

                             budget request
    Question. The fiscal year 1998 budget request is almost 24 percent 
above the fiscal year 1997 allocation. Given the current budgetary 
climate, how did the Administration determine that $136 million was an 
appropriate funding level for NEH?
    Answer. The NEH budget request for fiscal year 1998 is a modest but 
forward-looking budget that would permit us to regain about half of the 
ground we lost in fiscal year 1996 due to Congress's massive 36 percent 
reduction in our funding. A budget of $136 million is a reasonable 
amount of public funds to invest in humanities activities that will 
yield both immediate and long-term returns to the nation. The request 
acknowledges the extraordinary pressures the federal government faces 
in trying to balance the goal of reducing the financial burden on 
taxpayers with the necessity of maintaining an adequate level of 
services for the American people. With this budget, we signal our 
commitment to make sacrifices to help control the overall level of 
federal spending. At the same time, it is also a budget that would not 
undermine our fundamental ability and obligation to carry out our 
legislated mission to advance the humanities in the United States.
    Question. What does the 24-percent increase buy for the American 
people?
    Answer. Compared to NEH's current funding of $110 million, a budget 
of $136 million in fiscal year 1998 would enable the Endowment to help 
advance the nation's educational and cultural life by supporting 
several special initiatives and by increasing the number of high 
quality projects that we are able to fund. Specifically, funding at the 
fiscal year 1998 request level would improve humanities education for 
America's students, help teachers make better use of new information 
technologies in their classrooms, preserve documents and other 
materials vital to the nation's cultural heritage, foster basic 
research and scholarship that expand our knowledge and understanding of 
the humanities, provide opportunities for Americans to engage in a 
lifetime of learning in the humanities, and increase third-party 
support for humanities projects and institutions.
    Question. What would be your programmatic priorities at the 
increased funding level?
    Answer. At the request level, our priorities are to try to regain 
some buying power in our core programs, which were cut substantially in 
fiscal year 1996, and to proceed with the special program initiatives 
and emphases we describe in our budget submission, such as American 
Legacy Editions, Teaching with Technology, ``My History is America's 
History,'' and special support for small public libraries in the 
Challenge Grants program.
    Question. Would your priorities remain the same if funding were to 
be decreased?
    Answer. Yes, we would try to follow-through with our programming 
priorities even if our budget request were not forthcoming. If that 
were the case, however, we would need to reassess our programming in 
light of available resources and the tenets that guided our 
restructuring efforts in fiscal year 1996. That is, out of any future 
appropriated sum we will first try to ensure adequate support for those 
activities that are best done at the national level, have long-term 
impact, have few other sources of support, strengthen the institutional 
base of the humanities, and reach broad sectors of the American public.
    Much would depend on the magnitude of the reduction. For example, 
Challenge Grants awarded in prior years would need to be matched during 
fiscal year 1998 as grantees raise the required gift funds; but at some 
level of budget reduction we would probably cease awarding any new 
challenge awards. Because the state councils depend on the federal 
government for the greater part of their operating support, we have 
tried to cushion the effect of NEH budget cuts on these unique 
organizations. But funding for the Federal/State Partnership has 
already risen from a little over 20 percent of the Endowment's budget 
to over 30 percent. Further cuts would undoubtedly require 
progressively steeper reductions in the councils' funding if the 
Endowment is to continue the national programs that support such 
important activities as humanities research, the preservation of 
brittle books, teacher seminars and institutes, and major documentary 
films for television.
    Question. Please describe any long term investments or new 
initiatives that are currently being developed. What effect would new 
initiatives have on existing grantees if funding is not increased?
    Answer. As described in our official fiscal year 1998 appropriation 
submission, special features and initiative of the NEH budget request 
include:
  --Continuation of the agency's Teaching with Technology special 
        initiative that is helping teachers incorporate new information 
        technologies such as CD-ROMs and the Internet into their 
        classrooms. The fiscal year 1998 request would also enable NEH 
        to build on the successes of this initiative by putting in 
        place a new multi-year special effort to help schools prepare 
        to take better advantage of the new electronic materials and 
        technologies.
  --Support for other technology projects that will help to speed the 
        inclusion of humanities materials onto the new information 
        superhighway and provide wider access to these materials for 
        all Americans.
  --A new American Legacy Editions special initiative to help ensure 
        the continuation of projects that are compiling documentary 
        editions of the papers and writings of U.S. Presidents and 
        other important literary and historical figures;
  --A new special initiative, which we are calling My History is 
        America's History, that will encourage Americans to learn more 
        about the history of their families and to relate this history 
        to the broad sweep of events and trends in American and world 
        history;
  --Fiscal year 1998 will mark the third year of the agency's three-
        year cooperative partnership with the Andrew W. Mellon 
        Foundation to bolster funding for fellowship programs sponsored 
        by independent centers for advanced study in the humanities; 
        and
  --Special challenge grants for public libraries, particularly those 
        that are located in rural areas and inner cities, that will 
        help these institutions build endowments to strengthen their 
        humanities programming.
    As noted in the answer to the previous question, if our budget is 
not increased in fiscal year 1998, we would try to implement as many of 
our planned initiatives as possible while still maintaining support for 
our core program activities.
             government performance and results act (gpra)
    Question. Please describe your progress and milestones toward 
preparing a strategic plan, including consultation with interested 
parties.
    Answer. The first draft of NEH's strategic plan was prepared almost 
two years ago. Through an iterative process of review and revision, new 
drafts have been developed in the succeeding months. At various stages 
these drafts have been circulated to the Office of Management and 
Budget, to NEH's National Council on the Humanities, and to more than 
100 of the agency's ``stakeholders.''
    The latest draft of NEH's strategic plan was recently submitted to 
our Congressional oversight committees for their review and comment. 
Feedback we receive from this stage of the process will inform the 
final submission that is due to Congress in September of this year.
    Question. Given the current budgetary climate, how are you 
addressing funding and authorization issues in the development of GPRA 
goals and the strategic plan?
    Answer. Since the Endowment's restructuring in 1995, the agency's 
budget has remained relatively steady at approximately $110 million. 
Early indications are that this level of appropriations will again hold 
for the coming fiscal year, so we have tailored our GPRA goals and 
objectives to fit this new reality. Should funding or authorization 
developments warrant a different course of action on the part of the 
agency, we will amend our five-year strategic plan accordingly.
    Question. How will the NEH measure the short-term and long-term 
impact of its programs?
    Answer. We are in the process of developing performance goals and 
indicators for all of our funding programs. The goals will articulate 
what we hope to achieve through our programs, and the indicators will 
then describe the measures we will take to determine whether or not we 
are actually achieving our goals. In developing our indicators we will 
be looking for ways to determine whether or not our programs are 
accomplishing their intended purposes (i.e., we will be assessing 
short-term program outcomes), and we will also seek to develop measures 
of the indirect effects or consequences of our funded work (a longer-
term assessment of program impact).
    Question. What are the grant-making priorities for the agency in 
the next year, for the next 5 years?
    Answer. In addition to our ongoing programmatic priorities, we will 
feature the following special emphases in the coming year:
  --The beginning of a multi-year special effort to help schools 
        prepare to take better advantage of the new electronic 
        materials and technologies.
  --Support for other technology projects that will help to speed the 
        inclusion of humanities materials onto the new information 
        superhighway and provide wider access to these materials for 
        all Americans.
  --A new American Legacy Editions special initiative to help ensure 
        the continuation of projects that are compiling documentary 
        editions of the papers and writings of U.S. Presidents and 
        other important literary and historical figures.
  --A new special initiative, which we are calling My History is 
        America's History, that will encourage Americans to learn more 
        about the history of their families and to relate this history 
        to the broad sweep of events and trends in American and world 
        history.
    Over the next five years, NEH's grant-making priorities will focus 
on: preserving and increasing the availability of cultural and 
intellectual resources essential to the people of the United States; 
strengthening teaching and learning in the humanities in schools and 
colleges across the nation; facilitating basic research and original 
scholarship in the humanities; providing opportunities for Americans to 
engage in lifelong learning in the humanities; strengthening the 
institutional base of the humanities; maintaining and strengthening 
partnerships with the state humanities councils; establishing 
collaborative partnerships with public and private institutions and 
organizations in support of the humanities; and creating new programs 
and initiatives that respond to emerging needs and opportunities in 
American society.
    Question. What are the organizational priorities for the agency for 
the next year, for the next 5 years?
    Answer. The Endowment is aggressively supporting the National 
Performance Review goal of creating a government that works better and 
costs less. In furtherance of this goal, the agency will focus on the 
following priorities in the coming years: the installation of a 
relational data base capable of systematically capturing and reporting 
on a variety of agency records; the continued refinement of NEH's 
customer service standards, with the ultimate goal of weaving these 
standards into the fabric of the agency's daily work; standardizing and 
clarifying the agency's application guidelines to make them more 
``user-friendly'' to prospective applicants; streamlining the review 
process for proposals submitted to the Endowment; and developing better 
systems for monitoring the performance of the agency's funding 
programs.
                              grant-making
    Question. Within the request, grant program funding increases by 
over 26 percent over fiscal year 1997. Yet at the same time the FTE/
staffing level remains constant. Will you have enough staff to enable 
the Endowment to award all of the funds in a timely manner?
    Answer. Our FTE level of 170 should provide enough staffing support 
to administer increased grant funds at the fiscal year 1999 funding 
level. In fiscal year 1995 we reduced the number of divisions that 
administer grant programs from 6 to 3, which provided the most 
effective and efficient organization possible. There is enough 
flexibility within that structure to process a range of applications; 
thus applications processed within the increased fiscal year 1999 
funding request can be accommodated effectively using our existing 
staff.
    Also, some of the fiscal year 1999 increase is for the Federal/
State Partnership program, which should not require any additional 
staff effort because those funds are distributed on a formula basis, 
without the need for additional panel reviews.
    Question. The budget request includes an increase of nearly 100 
percent for the Research and Education sub-category of Education 
Development and Demonstration. Please describe how this increase will 
be used and what the impact will be.
    Answer. The funding increase we are requesting for the Research and 
Education division for fiscal year 1998 must be placed in proper 
context. That is, when Congress radically reduced the NEH budget in 
fiscal year 1996, the program activities represented by this division 
were devastated: funding dropped precipitously from $51.324 million in 
fiscal year 1995 to the current fiscal year 1997 funding level of 
$21.584 million. In fact, this division came into existence as a result 
of the reorganization of the Endowment that the budget reductions 
necessitated: In fiscal year 1996, the agency restructured three major 
program divisions with 24 discrete grant programs into one new Research 
and Education division containing only four grant programs.
    The fiscal year 1998 funding request for the Research and Education 
division is needed to breathe some life back into these two key 
components of the Endowment's mission--that is, support for scholarly 
research and education in the humanities. The Research and Education 
division is also the home of two major special program initiatives the 
agency is proposing at our fiscal year 1998 request level of $136 
million: the American Legacy Editions initiative, which will help 
ensure the continuation of projects that are compiling documentary 
editions of the papers and writings of U.S. presidents and other 
important literary and historical figures and NEH's ``Schools for a New 
Millennium'' special program emphasis, which will extend the 
Endowment's recent efforts and successes in helping teachers and 
schools incorporate new information technologies involving the 
humanities into the nation's classrooms. The funding increase requested 
for Research and Education for fiscal year 1998 would enable the 
Endowment to implement fully these initiatives, which are addressing 
important needs in the humanities.
    Question. The Special Projects sub-category of Public and 
Enterprise grants is proposed to increase by nearly 350 percent. Please 
describe how these funds will be used and what the impact will be.
    Answer. The Special Projects category is designed to support 
activities that encompass a variety of formats and venues not readily 
accommodated within the guidelines of other programs in the Public 
Programs and Enterprise division. In fiscal year 1996, Special Programs 
awarded 2 grants under its regular guidelines and 9 grants as part of a 
special competition related to the Endowment's national conversation on 
American Pluralism and Identity. The national conversation initiative 
concluded in fiscal year 1996, though projects that address the themes 
of the initiative will continue to be eligible for support throughout 
the Endowment's regular programs. With the funds we are requesting for 
fiscal year 1998, we would expect to award 9 grants under the regular 
Special Projects guidelines.
    Question. In fiscal year 1996 the Endowment realigned its grant 
programs from 31 to 9. Describe the manner in which the new categories 
meet the needs of the Endowment, the applicants, the grantees, and the 
humanities community.
    Answer. In order to adjust to an fiscal year 1996 budget reduction 
of 36 percent, we reinvented the Endowment as a leaner, more focused, 
and flexible agency. Getting smaller was certainly not our idea, but 
getting sleeker was. Our efforts are now more explicitly directed to 
those activities that are best done at the national level, that have 
long-term impact, that have few other sources of support, and that 
strengthen the institutional base of the humanities. Within a greatly 
simplified organizational structure, NEH staff increasingly work 
collaboratively, often forming ad hoc project teams. Much as they may 
be dismayed by the magnitude of the reductions in funding available to 
the Endowment for awarding grants, members of the humanities community 
have generally responded favorably to our new, consolidated structure, 
typically finding it is less confusing and more amenable to ``one-stop 
shopping.'' Finally, we have accelerated implementation of computer and 
communications technologies that are making information much more 
accessible to applicants, grantees, and the public.
    Question. What changes do you anticipate making in the grant 
guidelines before the next round of funding?
    Answer. We are now in the process of streamlining and standardizing 
all of our programs' application guidelines. We are developing standard 
language for those sections of our guidelines that are common to all 
programs, and we are establishing a common structure for all guidelines 
booklets. In these ways we hope to make the process of applying for NEH 
support even simpler.
    Question. Please describe the peer-review process used to evaluate 
applications for funding.
    Answer. While ``peer review'' is the most important component of 
NEH's multi-tiered review system, it is neither the only nor the final 
determinant of an application's status. Except in the case of Challenge 
Grants and grants awarded by Federal/State Partnership, the Endowment 
makes awards for specific projects in the humanities. To apply, an 
individual or organization submits a proposal for a project to one of 
the Endowment's funding categories. A final decision on the proposal is 
normally made about eight months after the application deadline.
    Each grant application to the Endowment is evaluated by 
knowledgeable persons outside the agency who are asked for their 
judgments about the quality and significance of the proposed project. 
Hundreds of scholars, humanities professionals, and other experts 
annually serve on NEH ad hoc panels, which are convened throughout the 
course of the year. Panelists represent a diversity of disciplinary, 
institutional, regional, and cultural backgrounds. In some programs, 
the judgment of panelists is supplemented by individual reviews 
solicited from specialists who have extensive knowledge of the specific 
subject area or technical aspects of the application under review.
    The advice of evaluators is assembled by the staff of the Endowment 
who comment on matters of fact or on significant issues that might 
otherwise be missing from the review. These materials are then 
presented for consideration to the 26-member National Council on the 
Humanities, which meets three times each year to advise the Chairman of 
the agency. The NEH Chairman takes into account the advice provided by 
this review process and, by law, makes the final decision about 
funding.
    It is the highest priority of NEH to provide sufficient funds to 
operate an effective review system. Our overriding goal is to ensure 
that the projects that ultimately receive federal support will be those 
that are judged to be most likely to make significant contributions to 
the humanities.
    Question. When Challenge Grant monies are used to create or augment 
endowments, how much of the federal funds are permitted to be used for 
administrative costs of operating the endowments?
    Answer. Up to 10 percent of the federal award may be applied toward 
fund-raising costs specifically related to the purposes to be endowed 
by the grant.
    Question. Has the NEH sought a federal endowment for itself?
    Answer. NEH does not have legislative authority to solicit and 
invest private contributions, which would be a pre-requisite to 
establishing a true ``federal endowment.'' A bill recently introduced 
by the Senate Labor and Human Resources Committee, S. 1020, would 
provide such authority. We believe that the humanities would benefit 
greatly were we to receive this authority. As we have proven with our 
extensive track record in securing private support for our funded 
projects, NEH is capable of leveraging a significant amount of 
nonfederal funds for humanities activities. We would mention, however, 
that a huge amount of capital would need to be invested in an endowment 
over a significant period of time before NEH would be able to support 
the level of humanities projects and activities that it now provides 
with annual appropriations from Congress.
    Question. What kind of technical assistance does the Endowment 
provide to institutions and individuals in the area of business 
planning and grant-application preparation?
    Answer. NEH challenge grants are designed to strengthen the 
management of humanities institutions as well as their finances and 
facilities. As part of their application for a challenge grant, 
institutions must draft a plan for the long-range future of their 
humanities programs in light of the history, objectives, and 
anticipated financial resources of their organization. Then, to meet 
the Endowment's demanding matching offer, challenge grant recipients 
typically augment their professional fund-raising capabilities, in some 
cases developing such resources for the first time.
    Applicants to any of the Endowment's programs may take advantage of 
several kinds of assistance in the preparation of their funding 
proposal. Prior to submitting a proposal, prospective applicants are 
invited to get in touch with an NEH program officer in the relevant 
program (by letter, phone, or e-mail) to discuss their project. At this 
stage, NEH staff routinely offer suggestions on how to prepare a 
competitive funding proposal. Applicants may also submit a preliminary 
proposal for staff comment in advance of the competition deadline. 
Every year, NEH staff hold public, grant-preparation workshops in 
various parts of the country, usually in conjunction with a project 
site visit. Finally, applicants who are unsuccessful in a particular 
competitive round may request a synopsis of the review panelists' 
comments on their proposal, which they may revise and resubmit at the 
next application deadline--and to a newly constituted review panel--
without prejudice to their chances of getting a grant.
             leveraging federal funds with matching grants
    Question. Describe the matching requirements for recipients of NEH 
grants.
    Answer. Conventional ``matching grants'' are awarded in most 
programs of the Endowment to support discrete humanities projects 
approved through the normal competitive process. The recipient of a 
matching grant, usually an institution of sufficient scale and 
administrative sophistication to undertake fund-raising, is offered a 
federal award conditioned upon attracting an equivalent amount of 
third-party, cash contributions from non-federal sources. An offer of 
matching funds may comprise the entire amount of the Endowment's grant, 
but more often it is combined with an outright award that enables the 
project to proceed while fund-raising is getting underway. In fiscal 
year 1996, the Endowment awarded $10.3 million in matching grants.
    Challenge grants are awarded in the program of that name to 
underwrite long-term institutional needs such as endowment building. 
First-time challenge grant recipients must raise $3 in cash 
contributions for each federal dollar of their award, and recipients of 
a subsequent challenge grant must raise $4. In fiscal year 1998, the 
Endowment will offer a special challenge grant initiative for public 
libraries that will require only $2 of fund-raising for each federal 
dollar. In fiscal year 1996, the Endowment awarded $9.9 million in 
challenge grants, leveraging approximately $35 million in non-federal 
contributions.
    In addition, most NEH project grants awarded to institutions entail 
substantial cost-sharing in the form of contributions of cash or in-
kind services. Even individual grant recipients, such a NEH fellows, 
often receive supplementary support from their home institution. In a 
typical year, project cost-sharing by grant recipients--in addition to 
matching--averages--about 95 cents for each federal $1 we award.
    Question. Are the matching requirements a challenge for applicants 
to meet?
    Answer. Matching awards have proven to be a very effective way to 
leverage non-federal contributions for the humanities. In the 20 years 
of existence, the Challenge Grants program has generated over $1.15 
billion in contributions. Only 2.5 percent of the challenge grant 
funding on offers during that time has been forfeited for lack of fund-
raising success. Since NEH was founded, matching grants for humanities 
projects have stimulated an additional $333 million in third-party 
support. Approximately three quarters of these grants that conclude 
within a given year are completely successful in that they leverage the 
entire amount of federal funds offered. Project matching awards are 
usually offered in conjunction with an outright grant and, to some 
extent, constitute a source of supplementary funding. Nevertheless, 
well under 10 percent of the recipients of these grants fail to raise 
at least enough contributions to claim some portion of their matching 
award.
    The high success rate of both challenge grants and project matching 
grants owes a great deal to the selectivity of the Endowment's award 
process. A feasible fund-raising plan is an essential part of a 
successful application for a challenge grant, and the Endowment does 
not incorporate a matching requirement in a project grant unless our 
staff are satisfied that the grant recipient will have a high 
probability of funding-raising success. It is important to realize that 
most NEH grants do not entail a third-party matching requirement, even 
if they do usually require cost sharing by the recipient institution. 
In fiscal year 1996, just 22 percent of the Endowment's grant 
obligations were for matching. In fiscal year 1998, we hope to extend 
the challenge grant concept to a category of institutions for whom a 
3:1 or 4:1 funding-raising requirement might be an insurmountable 
hurdle; the Endowment will offer public libraries a chance to receive 
one federal dollar for each two contributor dollars.
    The recent budget cuts are having an adverse effect on the success 
rate of NEH matching grants, however. In order to allocate the 
Endowment's scarce funds for matching in a way that is efficient and 
fair, we have had to deny most requests for an extension of the grant 
period stipulated for fund-raising. Some institutional recipients of a 
matching grant that in the past might have had better success with more 
time must now abandon their fund-raising campaign at a point short of 
completion.
    Question. Do the matching requirements limit the number of 
applicants?
    Answer. Matching is a requirement only in the Challenge Grants 
program. Certainly the matching required by a challenge grant, 
ordinarily three or four contributor dollars for each federal dollar, 
does limit the number of applicants. Some institutions that do valuable 
work in the humanities lack the scale, administrative sophistication, 
or contributor base to conduct the kind of fund-raising campaign a 
challenge would require. In fiscal year 1988, we hope to reach some of 
these institutions with a challenge grant initiative for public 
libraries that will require only $2 in contributions for each $1 in 
federal support. A matching requirement is not imposed on the recipient 
of a project grant unless NEH staff are satisfied that the institution 
is likely to be a successful fund-raiser; and, even then, our matching 
offer is usually accompanied by an award of outright funding.
    Question. Must the grantees be able to prove/show in the 
applications that there is a high likelihood of raising the matching 
funds needed to secure a grant?
    Answer. Applicants proposing large projects are encouraged to 
request at least partial matching support and to specify potential 
donors in their application submission to the Endowment. The 
feasibility of an applicant institution's fund-raising plan is an 
essential criterion in the review of a proposal for a challenge grant.
    Question. How do the applicants for grants show the Endowment they 
can provide the matching funds required?
    Answer. Most NEH project grants do not entail a matching 
requirement. Institutions proposing large and costly projects are 
expected to discuss fund-raising possibilities in their application 
submission, however. Applicants for a challenge grant are expected to 
address such issues as the long-term financial stability of the 
institution; the feasibility of their fund-raising plan; and the 
adequacy of staff and other administrative resources to conduct a fund-
raising campaign.
                   funding sources other than federal
    Question. Does the NEH receive funding for grant-making from 
private sources?
    Answer. The Endowment's Office of Enterprise was established 
expressly for the purpose of forging partnerships with outside funders. 
For example, NEH and the Andrew W. Mellon Foundation are collaborating 
on a three-year, joint-funding effort to ensure that the nation's 
centers for advanced study in the humanities can continue to support 
scholarship at an adequate level; and the Endowment, MCI corporation, 
and the Council of the Great City Schools are collaborating on the 
development of EDSITEment, a ``one-stop-shopping'' gateway to 
educational content on the internet. Neither of these partnerships will 
entail using private contributions for making grants, however. NEH and 
its private partners will be working in parallel.
    Every year, NEH matching and challenge grants help humanities 
institutions leverage private sources of support. These contributions 
go directly to the grantee institutions, not to the Endowment. The only 
recent instance when an outside funder provided private monies for 
making NEH grants was the DeWitt-Wallace Readers Digest Foundation's 
five-year, $2.5 million participation in the Endowment's Teacher-
Scholar program.
    Question. How much did the NEH receive in donations in fiscal year 
1996; what is the estimate for fiscal year 1997 and fiscal year 1998?
    Answer. The Endowment received nearly $99 thousand in donations in 
fiscal year 1996. We estimate donations of $100 thousand in fiscal year 
1997 and in fiscal year 1998.
    (These donations are in addition to the funds generated by our 
Challenge Grants program and by our matching program for humanities 
projects. In fiscal year 1996, these two efforts raised almost $46 
million.)
    Question. Does the Endowment anticipate seeking authority to 
solicit and invest private funds?
    Answer. As noted in an answer to a previous question, the Senate 
Labor and Human Resources Committee has introduced a bill, S. 1020, 
that would provide ``solicit and invest'' authority for NEH.
    Question. What changes in legislative authority would be needed to 
permit the Endowment to solicit and invest private funds?
    Answer. Basically, NEH needs to have express authority to raise and 
invest nonfederal funds for endowment-building purposes and to use any 
income that would accrue from this endowment to support projects and 
programs in the humanities.
    Question. What dollar amount of private, state, and/or local funds 
was used to meet the matching requirements for NEH grants? How do these 
matching funds compare with total funding available for the humanities? 
How does the amount of federal investment in the humanities compare 
with the total annual investment made in the humanities by all sources 
in the United States?
    Answer. In fiscal year 1996, NEH matching requirements leveraged 
approximately $46 million in nonfederal funds. In addition, we estimate 
that cost-sharing requirements on NEH grants generated another $90 
million in nonfederal support. The sum--$136 million--appears to be 
significantly greater than the amount available for the humanities from 
all other sources. In 1994 (the most recent year for which data are 
available), private foundations contributed $35 million to the 
humanities, representing less than one percent of all of their giving 
that year. Although similar figures for corporate and individual giving 
are not available, we know from previous research that neither sector 
has a strong track record in giving to the humanities.
    In sum, NEH grants, together with the nonfederal funding leveraged 
by those grants, represent a significant share of all funding available 
for the humanities. As the president of one major foundation once said, 
``NEH is by far the most important external source of funding for the 
humanities in the United States. It is no exaggeration to say that the 
decisions made concerning the budget for the NEH ... have an absolutely 
decisive impact on the health and character of the humanities in 
America.''
                    partnerships and administration
    Question. Describe the support that the NEH provides to the 
Institute for Museum and Library Services.
    Answer. An interagency agreement between NEH and IMLS authorizes 
the Endowment to provide to IMLS certain administrative services. Using 
its own staff and resources, NEH provides specific accounting, audit, 
automatic data processing, budget, equal employment opportunity, legal, 
administrative, and personnel services. This method of providing 
services is far less expensive than it would otherwise be for a small 
agency like IMLS to create additional staffing, space, and equipment to 
perform the same services in-house.
    Under the terms of the interagency agreement between the two 
agencies, IMLS reimburses NEH for the actual cost of services provided.
    Question. Describe NEH efforts to leverage federal funds through 
partnerships with other federal agencies.
    Answer. In recent years the Endowment has entered into partnerships 
with a variety of federal agencies [in pursuit of common goals?]:
  --In 1996 and again in 1997, NEH joined with the Voice of America to 
        support a national essay contest on themes related to NEH's 
        National Conversation initiative.
  --Last year we entered into a short-term working agreement with the 
        Library of Congress to share our expertise on the design and 
        execution of peer-reviewed grant competitions.
  --We have recently joined forces with the Federal Emergency 
        Management Agency to produce a Disaster Recovery Kit, which is 
        designed to provide cultural institutions with guidance on the 
        preservation of cultural materials that are susceptible to 
        damage as a result of floods, fires, hurricanes, and other 
        natural disasters.
  --For the past twenty years NEH has been joining with other federal 
        agencies to support a number of national data collection 
        projects. Among the projects NEH has funded in this way are the 
        Survey of Earned Doctorates, the National Museum Survey, and 
        the National Study of Postsecondary Faculty.
    Although not all of these projects involve the leveraging of 
additional funds, each represents a concerted effort to advance common 
goals through mutually beneficial partnership arrangements. In this way 
the reach of federal dollars is greatly extended.
    Question. Does the NEH coordinate its materials preservation 
training with other federal agencies engaged in similar work? Briefly, 
please describe any interagency training efforts.
    Answer. We are not aware of any other preservation education and 
training programs similar to the type NEH supports. Indeed, the 
Endowment's support for these activities is intended to address clear 
needs in the preservation field that are not being met by other federal 
agencies. In addition, NEH is also unique in providing support to 
regional field service organizations around the country that offer a 
rich array of preservation educational training services and 
information to libraries, museums, and other humanities-oriented 
institutions in their respective areas.
    Question. Please describe the Endowment's efforts to generate non-
federal support for preservation activities for endangered materials.
    Answer. The Endowment has played a direct role in stimulating 
nonfederal funding for preservation. Since the establishment of NEH's 
Office of Preservation in 1986, projects supported by the Endowment 
have leveraged over $10.9 million in gifts from private donors and 
foundations. Moreover, the division's grants in the last three years 
generated cost-sharing from grantees totalling $41.6 million. 
Essentially, however, through NEH the federal government is providing 
vital funding and national leadership in an area where private sector 
or other nonfederal support is limited.
    Question. Do you anticipate starting any new interagency efforts in 
fiscal year 1998?
    Answer. One of the key objectives of the Endowment is to forge new 
partnerships with public and private institutions in support of the 
humanities. We do not now, however, have any specific plans to develop 
new collaborations with other agencies of the federal government in 
fiscal year 1998.
    Question. How has the fiscal year 1996 reduction in staffing and 
reorganization from 6 programming divisions to 3 affected the daily 
operations of the NEH?
    Answer. With dramatically fewer internal administrative divisions, 
NEH staff are now routinely working collaboratively, often in ad hoc 
project teams. We believe our new structure is helping us make the most 
efficient and creative use of our drastically reduced resources for 
making grants.
    Question. What lessons have you learned from this streamlining?
    Answer. We have learned to be more collaborative, innovative, and 
flexible. These changes in our procedures and habits of mind probably 
outweigh the changes in our administrative structure.
    Question. Do you have further plans to fine-tune the NEH in terms 
of organizational structure?
    Answer. We are conducting a strategic planning exercise in 
conjunction with our implementation of the Government Performance and 
Results Act (GPRA). All aspects of the Endowment's operations are being 
review exhaustively. However, at present we have no immediate plans to 
alter our current structure.
    Question. Does the NEH seek to learn from and offer insights to 
executives and staff of other endowment and philanthropic organizations 
in the form of details and exchanges?
    Answer. For many years the Endowment took advantage of personnel 
exchange opportunities made possible under the Intergovernmental 
Personnel Act. Under the IPA we were able to bring the fresh 
perspectives of outsiders to the work of the agency, while also 
permitting other organizations to benefit from the Washington-based 
knowledge of our NEH employees. In recent years we were also able to 
make several of our best employees available to the National 
Performance Review for its government-wide review of agency functions 
and operations. In the wake of the significant down-sizing of the 
agency in 1995, however, we have not had the resources necessary to 
continue such exchanges and details.
                          internet and the neh
    Question. How does the NEH benefit from its relationship with the 
Institute of Museum and Library Services? Does this IMLS support 
include a transfer of knowledge of internet programming and access to 
the NEH?
    Answer. Actually, according to a long-standing arrangement, NEH 
provides certain computer and internet services to IMLS. More 
importantly, the programs of NEH and IMLS complement each other in many 
ways, including their use of the new communications technologies to 
make the resources of libraries and museums more accessible to the 
public. For example, IMLS makes grants to state library agencies to 
support the acquisition of computer systems and telecommunications 
technologies, the development of electronic linkages among libraries 
and other cultural institutions, and the provision of information 
services to underserved communities. All of these activities help NEH 
reach a wider and more diverse audience with the education software, 
digitized archival collections, and virtual museum sites on the 
Internet whose development our grants have sponsored.
    Question. What do you see as the future of the humanities on the 
internet?
    Answer. We recently released a special report, NEH in the Digital 
Age, that describes in considerable detail the role we envision for the 
new information technologies in fostering scholarship and learning in 
the humanities.
    The Endowment has joined a public-private partnership with MCI 
Communications Corp. and the Council of Great City Schools to create 
``EDSITEment,'' a new website that, when it premiers in September 1997, 
will provide one-stop shopping for teachers, students, and parents who 
are searching for high quality humanities resources on the Internet. 
MCI has pledged $500,000 toward the EDSITEment, which will offer the 
best humanities education websites to anyone with internet access. In 
addition, the project will target special programs to 800 high schools 
in 23 Great City School cities, where teachers will receive additional 
help in integrating the resources on EDSITEment into their classroom 
instruction.
    The Endowment has completed the second year of a three-year 
Teaching With Technology initiative designed to support the development 
and implementation in humanities education of a wide array of 
innovative technological applications, including digital audio, video 
and imaging, hypertext and hypermedia, video-conferencing, speech 
processing, and Internet sites. In the first round of grants awarded 
last year, for example:
  --Northwestern University received $185,000 for a multimedia 
        relational database on the history of the United States Supreme 
        Court. Recently made available on the World Wide Web, ``Oyez, 
        Oyez, Oyez'' enables students anywhere to access summary and 
        full-text versions of the Court's most significant cases, an 
        audio archive of oral arguments in 500 Court cases, audio and 
        video materials about all justices since 1920, and much else.
  --The University of Virginia received $215,000 to develop CD-ROM and 
        Internet versions of ``In the Valley of the Shadow,'' an 
        interactive program that enables students to learn about the 
        lives of ordinary people during the Civil War. An extensive 
        archive of documents--including newspapers, photographs, census 
        and tax records, letters, diaries, photographs, and music--will 
        enable students to research daily life during the Civil War in 
        two Shenandoah Valley counties located on either side of Mason-
        Dixon Line.
  --Tufts University received $215,000 to develop a digital library on 
        ancient Roman culture that will be available both on CD-ROM and 
        on the World Wide Web. High school Latin students and 
        undergraduates will be able to access texts of all major Roman 
        authors up through the death of Augustus either in the original 
        or in translation, as well as a virtual museum of maps and 
        objects.
    In fiscal year 1998, the Endowment will launch a successor 
initiative to Teaching with Technology. Called ``Schools for a New 
Millennium,'' it will support efforts to help humanities teachers 
become proficient in the use of the new electronic materials and 
formats.
    The Endowment has long been at the forefront of the national effort 
to bring humanities scholarship into the digital age, sponsoring, among 
other things, the development of technical standards for digitally 
encoding texts and the conversion of invaluable research resources into 
digital form accessible on CD-ROM's and the Internet. For example, NEH 
support helped launch the University of California's monumental 
Thesaurus Linguae Graecea project, which has produced a CD-ROM that 
contains the entire extant corpus of ancient Greek texts. Through the 
use of infrared scanning technology, the Ancient Biblical Manuscript 
Center in Claremont, California, is creating digitized images of the 
Dead Sea Scrolls. Because of this NEH-sponsored project, these rarest 
and fragilest of texts will soon be accessible to scholars world-wide 
via CD-ROM and the Internet. Another project recently funded by the 
Endowment is creating a complete facsimile edition of the legal papers 
of Abraham Lincoln on CD-ROM.
    Increasingly, NEH-sponsored programs for the general public are 
reaching bigger audiences in a more engaging and accessible way through 
the use of such rapidly evolving technological innovations as virtual 
museums on the Internet, interactive computer displays, CD-ROM's, and 
videodisks. The Denver Public Library, with NEH support, has digitized 
35,000 photographs from its Western American Collection. This unique 
photo archive is currently accessible on computer workstations at the 
library; but it will one day be available to the whole nation, and to 
world, via the Internet. The Montana Community Foundation recently 
received an NEH grant to plan development of a multimedia CD-ROM on the 
Lewis and Clark expedition. Intended for use either by individuals or 
by museums and libraries, ``Discovering Lewis and Clark'' will 
incorporate selections from The Journals of Lewis and Clark, moving 
pictures, topographical animations, and audio material.
    Question. Are any funds in the Department of Education used for 
this purpose?
    Answer. The Department of Education supports some activities that 
are complimentary to what NEH is doing.
    The Department's Technology Literacy Challenge Fund (fiscal year 
1997, $200 million), which provides formula grants to state education 
agencies, and Technology Innovation Challenge Grants (fiscal year 1997, 
$75 million), which provide matching grants to locally based public-
private consortia, both support the acquisition of computers and 
telecommunications technologies and the development of technology-based 
curricula. In one such example, the Technology Innovation Challenge 
Grants program has already helped an urban school system on the Great 
Plains to connect its classrooms via the Internet to major museums 
across the country and to develop networked learning content that 
integrates the arts with core subjects including, history, mathematics, 
science, reading, and writing. A variety of other Department of 
Education programs are also contributing to the technology challenge 
grant initiative, including Title I of the Improving America's Schools 
Act, the Eisenhower Professional Development Program, School-to-Work 
Opportunities, Star Schools, the Regional Technology for Education 
Consortia, and the Regional Educational Laboratories.
    Question. Is the internet used by the NEH or its grantees as a way 
to reach underserved communities?
    Answer. Communities that are separated by location or economics 
from the nation's educational and research resources and its cultural 
amenities probably stand to gain the most from the encyclopedic, 
distance-annihilating potential of the Internet. For example, 
``EDSITEment'', which the Endowment is developing in a partnership with 
MCI, will make the latest and best in history, literature, and foreign 
language sites available to any school, parent, or student with access 
to an Internet connection. MCI is helping to connect 800 schools in 23 
cities as part of this project. In fiscal year 1998, our ``NEH 
Cyberschools'' program will help humanities teachers become proficient 
in the use of the new electronic materials and formats. This initiative 
is explicitly designed to exploit the potential of the Internet not 
only to link participating teachers in a single project but also to 
trigger rapid fire, nationwide dissemination and participation.
                              initiatives
    Question. Describe the My History is America's History project and 
the projected impact it will have in terms of numbers of participants.
    Answer. NEH is planning an initiative that will encourage Americans 
of all ages to explore their family history and its relationship to the 
larger pattern of community life, migration, settlement, and 
interaction that together make up the nation's history. The role NEH 
will play in this initiative is a new one. Under the auspices of the 
Endowment's Enterprise Office, we will act primarily as a broker of 
partnerships among public and private entities to achieve shared goals 
rather than as a funder of individual projects. Our plans are to join 
with historical societies, archives, libraries, genealogical societies, 
and other repositories of historical information to create national 
Partnerships for America's Story. At a minimum, we would expect to 
contribute $200,000 toward a total project cost of at least $1 million. 
At the same time, we will continue to support humanities research, 
scholarship, education, and public programs on American history through 
our regular grant programs.
    The dimensions of this effort are potentially very large. For 
example, we plan to publish and distribute a family history ``kit'' 
along the lines of our National Conversation Kit, which reached nearly 
10,000 community-based organizations. We will know more about the 
likely audience impact of this effort when we have assembled a roster 
of participating organizations and funders.
    Question. Within the funding category of Research and Education, 
you have proposed increasing the funding for American Legacy Editions 
by greater than double its current level of funding. What are some of 
the projects planned for this increase in funding? Are there enough 
projects in the pipeline that all of the funds would be able to be used 
in fiscal year 1998?
    Answer. The American Legacy Editions initiative is designed to 
ensure the survival of some of the most important projects now being 
conducted across the country that are preserving and making available 
cultural and intellectual resources essential to the people of the 
United States. Among the projects that would be included under the 
American Legacy Editionsrubric are: the papers and writings of several 
U.S. presidents, including Washington, Jefferson, Madison, Grant, and 
Eisenhower, as well as the papers and writings of other important 
figures in American history, including Franklin, Twain, Thoreau, 
Elizabeth Cady Stanton and Susan B. Anthony, and Martin Luther King, 
Jr. Other significant documentary editions that would fall within the 
initiative's scope include documents on the ratification of the U.S. 
Constitution and the Bill of Rights, the records of the First Federal 
Congress, the journals of the Lewis and Clark expedition, and documents 
relating to the history of emancipation. Considering that there are 
approximately 50 ongoing documentary editing projects that the 
Endowment has supported in recent years, which would make up the corpus 
of American Legacy Editions, there are indeed enough projects ``in the 
pipeline'' to use all of the funding requested for this initiative in 
fiscal year 1998.
    Question. Is the Teaching with Technology program coordinated with 
the Department of Education?
    Answer. Because NEH's Teaching with Technology program--which 
provides grants for discrete, content-rich projects that help teachers 
use new electronic technologies to enhance students' understanding of 
the humanities--is distinct from the types of education programs 
supported by the Department of Education, there is really no need to 
``coordinate'' the program with DOE. Staff at NEH and DOE do, however, 
often exchange information about various programs and projects, which 
helps to insure that there is no duplication of effort in the federal 
government's humanities education programming.
    Question. How will the report on A National Conversation on 
American Pluralism and Identity be made available to the public?
    Answer. The report on the National Conversation--One America, 
Indivisible--was published in July and is available from NEH free of 
charge. News of the report's publication was circulated widely, ranging 
from the Chairman's nationally broadcast speech at the National Press 
Club to a feature on the NEH website. Interested listeners and readers 
are invited to call, write, or e-mail their requests for complimentary 
copies.

                          subcommittee recess

    Senator Gorton. The subcommittee will stand in recess until 
9 a.m., Thursday, May 1, when we will receive testimony on the 
fiscal year 1998 budget from the Secretary of the Interior, 
Hon. Bruce Babbitt.
    [Whereupon, at 11:20 a.m., Thursday, April 24, the 
subcommittee was recessed, to reconvene at 9 a.m., Thursday, 
May 1.]



  DEPARTMENT OF THE INTERIOR AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

                              ----------                              


                         TUESDAY, MAY 20, 1997

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.
    The subcommittee met at 9:02 a.m., in room SD-124, Dirksen 
Senate Office Building, Hon. Slade Gorton (chairman) presiding.
    Present: Senators Gorton, Stevens, Cochran, Domenici, 
Burns, Bennett, Campbell, Byrd, Leahy, Bumpers, Reid, and 
Dorgan.
    Also present: Senator Bond.

                       DEPARTMENT OF THE INTERIOR

                        Office of the Secretary

STATEMENT OF HON. BRUCE BABBITT, SECRETARY OF THE 
            INTERIOR

                             Budget request

    Senator Gorton. The subcommittee will come to order.
    We are here today to hear testimony in support of the 1998 
budget request of the Department of the Interior, the principal 
department funded by the subcommittee. We are delighted that 
the Secretary has been able to be with us here today, and I 
would just like for him and for members of the subcommittee 
once again to refer to the chart there on my left.
    [The information follows:]

Interior programs fiscal year 1997 enacted

                                                                        
Land management programs:
    Forest Service......................................  $2,361,000,000
    National Park Service...............................   1,414,000,000
    Bureau of Land Management...........................   1,090,000,000
    Fish and Wildlife Service...........................     653,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................   5,517,000,000
                    ========================================================
                    ____________________________________________________
Indian programs:
    Indian Health Service...............................   2,054,000,000
    Bureau of Indian Affairs............................   1,606,000,000
    Navajo-Hopi/IAIA/special trustee/Indian gaming/
      Indian education..................................     119,000,000
                    --------------------------------------------------------
                    ____________________________________________________
        Total...........................................   3,779,000,000
                    ========================================================
                    ____________________________________________________
Science and minerals management programs:
    Geological Survey...................................     739,000,000
    Office of Surface Mining [OSM]......................     272,000,000
    Minerals Management Service [MMS]...................     163,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................   1,174,000,000
                    ========================================================
                    ____________________________________________________
Energy programs:
    Energy consrvation R&D..............................     570,000,000
    Fossil energy R&D...................................     365,000,000
    Naval petroleum NPR/reserves........................     144,000,000
    Energy information administration/economic 
      regulation........................................      69,000,000
    Alternative fuels production........................      -4,000,000
    Clean coal technology...............................    -123,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................   1,020,000,000
                    ========================================================
                    ____________________________________________________
Cultural programs:
    Smithsonian Institution.............................     370,000,000
    National Endowment for the Humanities...............     110,000,000
    National Endowment for the Arts.....................      99,000,000
    National Gallery of Art.............................      60,000,000
    Holocust Memorial...................................      31,000,000
    Institute of Museum Services........................      22,000,000
    Memorials...........................................      41,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     733,000,000
                    ========================================================
                    ____________________________________________________
Interior departmental offices:
    Interior affairs....................................      88,000,000
    Departmental management.............................      58,000,000
    Solicitor...........................................      35,000,000
    Inspector general...................................      25,000,000
                    --------------------------------------------------------
                    ____________________________________________________
      Total.............................................     207,000,000
                    ========================================================
                    ____________________________________________________
      Total.............................................  12,430,000,000

                           committee funding

    Senator Gorton. It shows where we are for the current 1997 
fiscal year, about $12.5 billion, just over one-half of which 
goes to the Department of the Interior itself. The largest part 
of our money, of course, that green line, goes to the four land 
management agencies, three of which are under the Secretary's 
jurisdiction, and the Forest Service that is not.
    Another very large portion, the second-largest portion, is 
comprised of programs for the benefit of Native Americans, 
primarily the Indian Health Service and the Bureau of Indian 
Affairs. The Indian Health Service is a particularly demanding 
responsibility of the subcommittee because the cost of simply 
maintaining existing levels of medical services increases at a 
rate that is in excess of inflation by a substantial amount.
    The third major grouping of agencies are the cultural 
agencies, the Smithsonian, the National Gallery of Art, the 
Kennedy Center, and the two Endowments. While these agencies 
account for a smaller portion of the total funds appropriated 
in the Interior bill, they are in most cases the agencies 
responsible for the care and protection of our Nation's 
heritage. These programs get very vocal support from across the 
country and from many Senators on both sides. In fact, when we 
had our hearing on the National Endowment for the Arts, I did 
not hear a single Senator on either side of the aisle who 
objected to continued funding of those agencies.
    The fourth group includes agencies that regulate minerals 
development out of our Nation's lands and those that produce 
the science and support management of those lands.
    The fifth grouping is programs within the Department of 
Energy, including energy conservation, research and development 
programs that are a high priority of the administration.
    So, Mr. Secretary, you are up with very, very tough 
competition. We have now agreed on an overall budget agreement 
through the year 2002. The Senate just last night passed a 
budget resolution that reflects that agreement. The increase in 
request on the part of the President is for just over 6 percent 
above the 1997 levels. The budget resolution will allow for an 
increase, but not an increase of that amount. So some 
reductions are going to have to be made, and we are going to 
need your help in setting priorities within your areas.
    You have got a wide range of responsibilities, some of 
which are multiagency such as the everglades restoration 
project and my own Interior Columbia basin ecosystem management 
project, not to mention the results of storm damage in Yosemite 
and elsewhere, and I understand you were there just in the 
course of the last couple of days.
    Some of the priority elements in the budget agreement do 
relate to programs under this subcommittee's jurisdiction. 
There are some of them that I am not completely in sympathy 
with. But I am a strong supporter of the bipartisan budget, and 
as far as I am concerned this subcommittee will meet the 
obligations that have been agreed to between the President and 
the congressional leadership in that connection. That leaves 
many other areas in this appropriations bill unprotected, and 
those priorities will have to be determined by the committee 
with, we hope, your help.
    With that, I would like to turn to my friend and guide in 
many of these things, Senator Byrd.

                    opening remarks of senator byrd

    Senator Byrd. Mr. Chairman, you will not proceed with 
questions until the Secretary has made his statement?
    Senator Gorton. We will let the Secretary make his 
statement.
    Senator Byrd. Well, I just share your sentiments in most of 
what you said. I am not onboard with respect to the so-called 
bipartisan budget agreement because I did not have anything to 
do with it. I did not have any voice in it, and so I am not 
buying onto it yet. But aside from that, the Senator has done 
yeoman's work on it in the budget committee, and I compliment 
him on that.
    I am glad to be here this morning with Secretary Babbitt, 
who has done a fine, fine job as Secretary. He has had 
limitations on appropriations and this has certainly been a 
problem for him and the people in his department. I compliment 
him on his good work, and I am delighted to be here, Mr. 
Secretary, this morning with you, and I look forward to hearing 
your statement.
    Senator Gorton. Senator Stevens, do you have an opening 
statement?
    Senator Stevens. No; I share Senator Byrd's statement. I 
will have some questions later, but I have no opening 
statement.
    Senator Gorton. Thank you.
    Senator Reid.
    Senator Reid. I will save my time for questions.
    Senator Gorton. Thank you.
    Senator Bond.

                    opening remarks of senator bond

    Senator Bond. Thank you, Mr. Chairman, for allowing me to 
join you today. We have in Missouri an ongoing interest in the 
Forest Service, the National Park Service, and the Fish and 
Wildlife Service, but I am here today to talk with the 
Secretary briefly about an area in which the State of Missouri 
has been drawn into a matter with the Interior Department 
against their will. And that is the filing of the petition by 
the Eastern Shawnee Tribe of Oklahoma to take land in southwest 
Missouri that they have purchased into Federal trust for the 
stated purpose of class III gaming.
    The application is now pending before the Secretary. I have 
had very productive discussions with the Secretary about it. 
The people of southwest Missouri are overwhelmingly opposed. 
The Missouri General Assembly has overwhelmingly adopted 
resolutions opposing it, State officials are opposed to it, in 
straw votes or opinion votes taken in the area they are opposed 
to it, and I just want to explore with the Secretary briefly 
the protections a State may have against the imposition of this 
kind of an activity in an area where it is totally 
inappropriate.
    Thank you for giving me the chance to be with you.
    Senator Gorton. Welcome to the club, Senator Bond.
    Senator Burns.
    Senator Burns. That was my line.
    Thank you, Mr. Chairman with your permission I will forgo 
my statement. It focuses mostly with the Park Service, and I 
will await the Secretary. I will await his statement, and I 
will do mine in the form of questions. Thank you very much.
    Senator Gorton. Senator Campbell.
    Senator Campbell. Thanks, Mr. Chairman. I have no opening 
statement. I do have maybe a couple of questions relating to 
parks and several other things, but the Secretary will be 
pleased to know that I am not going to ask him anything or 
buttonhole him about the Animas La Plata today.
    Secretary Babbitt. I do not believe it. [Laughter.]
    Senator Gorton. Mr. Secretary, it is up to you to give us 
your opening statement now.
    Senator Reid. I am going to ask the questions for him.
    Senator Gorton. I will say for my members here we have got 
a good attendance here, and I know that many of the members of 
this subcommittee have other duties, so I will defer my own 
questions until last, and allow my colleagues to ask theirs as 
soon as you have completed your opening statement.
    So please, Mr. Secretary, go forward.

                 summary statement of secretary babbitt

    Secretary Babbitt. Senator and committee members, thank you 
very much. In the spirit of this waiving of statements, I 
propose simply to summarize my opening statement.
    Senator Gorton. Your full statement will be included in the 
record.
    Secretary Babbitt. Thank you.
    I am pleased to come before the committee today in the 
spirit of the budget agreement which has been reached between 
the Congress and the administration, and I am optimistic that 
we are now, in terms of the Department of the Interior and 
these committees, way beyond the divisions of 2 years ago when 
we spent a lot of time in very antagonistic positions debating 
riders and debating fundamental differences over funding 
priorities. I am hopeful that we can work these issues out in a 
spirit of cooperation and bipartisanship, as indeed I think we 
for the most part succeeded in doing last year, to the 
substantial benefit of the Department and our various programs.
    I would at the outset, just briefly once again, underline 
the fundamental operative fact of our budget and operations in 
the Interior Department, and that is that our budget is about 
personnel and salaries. We have the highest percentage of 
personnel costs relative to total budget of any agency in the 
U.S. Government with the exception of the military and the 
Justice Department. And that, of course, means that as we begin 
the budget process each year we swallow 3 to 4 percent of fixed 
costs in terms of salaries, retirement, and benefits. That, in 
turn, has led us to substantial personnel reductions. During my 
tenure as Secretary we have reduced the payroll of the Interior 
Department by 12 percent, including a 15-percent cut in 
overhead in Washington and in other management positions. That 
is the largest percentage cut in personnel of any of the 
domestic cabinet agencies.

                       interior program direction

    Now, just a brief word about the nature of the program 
evolution in the Department. At the beginning of this second 
Clinton administration it might be helpful, very briefly, to 
suggest what the year-to-year additions, changes, and 
subtractions add up to in terms of overall direction. What we 
have been doing, I think consistently and with considerable 
success, is recognizing that in the West and elsewhere, in 
areas of our jurisdiction, we solve problems best by looking at 
the large picture, by looking beyond boundaries, by looking 
beyond the boundaries of agencies, by recognizing that 
increasingly in this complex interrelated world it is very 
difficult to solve problems one at a time. We, in fact, provide 
more conservation values and more resource development 
possibilities by looking across the landscape, bringing in all 
of the stakeholders, many of the Federal agencies, and 
attempting to craft larger solutions.
    That, of course, explains the emerging success in evolution 
of the Florida Everglades ecosystem restoration efforts. It is 
the theory that motivated the President's forest plan in an 
attempt to find an appropriate balance on the landscapes of the 
Pacific Northwest. It is being worked out now in the context of 
the issues in the California bay delta, where we are dealing 
with resource use, fish and wildlife, agriculture, the urban 
water supplies of California communities from San Francisco 
down to the Mexican border.
    There are a number of other efforts under way which have 
received less attention but I think are equally promising in 
their possibilities. I would mention just three. There is a 
large interstate effort under way in the Colorado River Basin 
now, designed to adjust and maximize the water supply resources 
for all of the conflicting claimants in the seven States that 
are covered by that basin. Senator Reid is well aware of the 
implications of that for Nevada. There are major changes under 
way in southern California involving urban users, agriculture 
with major impacts in Colorado and the upper basin States. But 
the important thing is that those efforts involve a 
comprehensive attempt to deal with ground water resources for 
the city of Albuquerque, fish and wildlife issues in Colorado, 
agricultural needs of the Navajo Indians, the administration of 
parks, the Endangered Species Act, water supply, as I 
mentioned, in Nevada, California, and Arizona.
    We will be in Denver probably in the next couple of weeks 
to join with the Governors of Colorado, Wyoming, and Nebraska 
for a major settlement involving the administration of the 
water resources of the entire Platte River basin. Senator 
Gorton mentioned the East Side Columbia environmental impact 
statement process. The two environmental impact statements 
relating to the Columbia River basin will be released within 
the next few weeks. They will begin a year-long process, a very 
public process involving all of the stakeholders of State and 
local governments, in an attempt to see if we can find the 
right management prescription for the Federal lands in the 
Columbia River basin. This will have large implications for 
timber harvest, grazing, the protection of fish, the 
development of lands, and the economies in all of the rural 
areas that are impacted. I have been carefully through the 
studies in the preliminary environmental impact statements. I 
believe we have a major opportunity to reach an important 
consensus about the future of the Federal lands in the four 
States that are impacted in the Pacific Northwest.

                        land management agencies

    Next, I would like to just say a word specifically about 
the budgets of the land management agencies. We have worked 
well with you in past years on these budgets, and I anticipate 
a productive year again this year. With respect to the National 
Park Service I would like to say three things.

                       fee demonstration project

    First of all, the fee demonstration program that was 
authorized by this committee, and indeed pressed upon me with 
considerable vigor by Senator Gorton, who in months leading up 
to the 1996 election called me regularly saying: ``why have you 
not raised fees in national parks on the eve of this 
election?''
    Well, the happy bottom line is that we have raised fees, 
and the public response has been overwhelmingly positive. We 
have had virtually no negative feedback, because I think the 
public understands that these fee increases are going to bring 
tangible improvements in the National Park System. The cause 
and effect relationship makes a lot of sense, and that is 
exactly what we are seeing. That program is now being expanded 
pursuant to the direction of this committee, and I am very 
pleased at your willingness to support that, and indeed to move 
us along at a rapid pace.

                         yosemite flood damage

    Senator Gorton mentioned the Yosemite flood, the 
destruction in the valley and our response in the form of the 
supplemental. Let me just say that the Park Service has done a 
splendid job in getting that park back open. As of the end of 
this week, all of the major access routes into Yosemite, from 
Fresno, Merced, and the northern communities, will be open. We 
still have a major reconstruction task. You can see it in the 
park, and you can see on the roads going in, and in all of the 
infrastructure.

                        transportation in parks

    Third, with respect to the parks, I think it is important 
that we seize the next 4-year period to deal with 
transportation issues as much as we possibly can. Yosemite, 
Grand Canyon, Zion, many of the parks are simply jamming up, 
and the problem is not too many people, it is too many cars. 
That is leading us to a series of management proposals for 
Yosemite, and for Grand Canyon, which I will take briefly as an 
example.
    The Grand Canyon management plan will be out shortly with a 
proposal that visitors will park their cars at the entrance to 
Grand Canyon National Park and move from the entrance into 
Grand Canyon Village on a mass transit system, possibly a light 
rail system. The economics look pretty good. It looks like we 
could actually put out a concession contract and finance that 
kind of system using a combination of the authority we now have 
for entrance fees and financing proposals of that nature.

                         endangered species act

    Let me say a brief word about the Fish and Wildlife 
Service. The major issue of the Fish and Wildlife Service 
obviously is the Endangered Species Act. There are discussions 
going on under the leadership of Senator Kempthorne and Senator 
Chafee that have made considerable progress. I do not know 
where that will end. I would simply say that we are 
aggressively involved in those discussions, and I think that 
the possibility there reflects the success that we have had in 
diffusing most of the issues--not all of them, but certainly 
most of the issues--relating to the Endangered Species Act 
through the use of habitat conservation plans, the evolution of 
the no surprises policy, and the innovations that we have put 
on the ground administratively using the Endangered Species Act 
are reflected in the budget proposals. I would urge you to look 
carefully at those proposals, because the budget requests are 
crucial to keeping the momentum going to resolve these problems 
rather than letting them drift into the courts, and ultimately 
to keep the successes going which I believe provide the 
framework for finding consensus on reauthorization.

                       national wildlife refuges

    There has been a considerable discussion increasingly in 
the national press about the issues in the national wildlife 
refuges. Those issues are reflected in a budget increase of 
approximately 6 or 7 percent. It is an important issue just to 
keep the refuge system moving.

                       bureau of land management

    A word about BLM. There is, Senator Bennett, an increase of 
approximately $5 million for the administration of the Grand 
Staircase-Escalante National Monument, and it has components 
which involve participation by the local communities and the 
play-out of a very intensive 3-year management plan.
    The budget has provisions relating to our efforts with the 
Forest Service to step up our treatment of forest lands through 
the use of thinning and prescribed fire. I will not get into 
that except to say that I believe it represents a major 
departure, and remarkably, an area of emerging consensus that 
has brought together the environmental community, the resource 
users, and the local communities, and I would direct your 
attention to that.

                            indian programs

    Last, a word about the Indian programs. I would make just 
two or three points. First of all, we ought to recognize that 
we have together made genuine progress in reshaping the Bureau 
of Indian Affairs. It is not widely acknowledged, but the fact 
is that we have downsized the Bureau of Indian Affairs more 
than any other agency in the Department. We have reduced the 
personnel in the BIA by 20 percent--20 percent--in the last 4 
years in the nonpolice and nonteacher categories. As a result 
of that, 91 percent of the funding in the Interior Department 
for Indian Affairs flows through directly to the Tribes 
themselves, teachers, and policemen. The administrative 
overhead of the Bureau of Indian Affairs has now been reduced 
to 9 percent. The process is working.

                           prepared statement

    The request for Tribal priority allocation is earmarked, I 
believe, in the budget agreement as a reflection of our concern 
for those issues. The remaining issue is the role of the 
special trustee. I would, rather than going through that in 
detail, be happy to respond to questions. I have expressed 
publicly my concerns about the direction that some of the 
trustee's efforts are taking. I have laid those out in writing. 
I would be happy to provide the committee with a copy of that. 
It is an urgent issue. It needs attention, and I think that it 
absolutely requires the close involvement of this committee, 
because the trustee has a statutory charge that is in some 
degree independent of my oversight. That is the reason that I 
want to very emphatically flag it, because I think we are 
jointly responsible for the outcome of this exercise and that 
it needs a great deal of very careful oversight and 
supervision.
    Mr. Chairman, committee members, thank you.
    [The statement follows:]
                Prepared Statement of Hon. Bruce Babbitt
    I am pleased to again appear before the Subcommittee on Interior 
and Related Agencies. As the Chairman and senior members know, this is 
my fifth annual appearance before the Subcommittee as Secretary.
    I testify today in support of the fiscal year 1998 budget request 
for the Department of the Interior with cautious optimism. Two years 
ago we were deeply divided over funding priorities and over the 
inclusion of controversial legislative riders in the Interior 
Appropriations bill. Last year, at the end, we were able to come 
together on a bill that was satisfactory in most respects to all of us. 
At the same time, agreement was reached on the authorizing side on the 
important 1996 Omnibus Parks Act and on other natural resource 
legislation, including the California Bay-Delta Environmental 
Enhancement and Water Security Act.
    In the context of an overall budget that reaches balance by 2002, 
the President's 1998 request for the Department builds on the 
foundation of our 1997 agreement. The President's request seeks a total 
of $7.5 billion for the Department in funds subject to annual 
appropriation by the Congress. An additional $2.3 billion will be 
provided by permanent appropriations.
    For Department programs under the jurisdiction of this 
Subcommittee, the request for annual appropriations is $6.6 billion for 
1998. This is an increase of $389 million in current budget authority 
over the regular appropriations provided in the 1997 Interior and 
Related Agencies Appropriations Act. It is an increase of $290 million 
in current authority over total 1997 appropriations available to date, 
including emergency funding released by the President.
    Within these totals, we propose the funding necessary for our 
operational and on-the-ground requirements to ensure that we meet our 
continuing commitments:
  --to the restoration of America's natural and cultural heritage 
        through regional partnerships with other Federal agencies, 
        State and local governments, community groups, and the private 
        sector;
  --to the millions of Americans who use the National Parks, National 
        Wildlife Refuges, and public lands every year, and to an 
        Endangered Species Act that works;
  --to protecting and encouraging Indian self-determination and meeting 
        Federal trust responsibilities to American Indians; and
  --to a program of scientific research that contributes to describing 
        and resolving the Nation's resource and environmental issues.
    Our ability to propose a budget that protects these priorities is 
due to the President's commitment to the environment and programs for 
Native Americans and to our aggressive efforts over the last three 
years to streamline the Department, reducing headquarters staffs and 
management layers, and to reengineer our processes and improve the 
efficiency and effectiveness of our customer services.
    As of the end of fiscal 1996, we had reduced our overall employment 
level by nearly 12 percent below 1993. The largest reductions have been 
in headquarters and overhead staffs, so that Interior employment in the 
Washington, D.C. area has been reduced by 15 percent. Our Department-
wide reduction is second only to the Defense Department among large 
cabinet agencies.
    Partnerships for restoration.--As I look back across the budgets I 
have presented to the Subcommittee, the most striking trend is the 
increasing recognition that natural resource issues cannot be resolved 
on the basis of jurisdictional boundaries or by the work of single 
levels of government, let alone individual agencies. For decades, the 
tendency was to think of natural resources in terms of a conservation 
approach: set aside the ``back forty'' as a nature preserve and it will 
take care of itself. Modern science and modern ecology have taught us 
that the natural world does not work that way. Landscapes are complex, 
living, and integrated systems.
    Three principles must guide our approach to the most pressing 
natural resource problems. First, we cannot solve these problems by 
treating individual symptoms. We must treat them on a landscape scale. 
Second, in seeking solutions we must look across, and beyond, agency 
boundaries. We need to involve all the relevant Federal agencies, as 
well as States, local and tribal governments, industry, non-profit 
groups, and concerned ordinary citizens. Third, our goal should be 
restoration, so as to ensure the long term ecological and economic 
health of communities.
    These three principles are reflected in some of our most important 
1998 proposals:
  --Congress authorized the Everglades National Park to preserve the 
        sawgrass prairies, mangrove forests, and abundant wildlife of 
        the largest remaining subtropical wilderness in the coterminous 
        United States. The Park has since been complemented by the 
        establishment of the Big Cypress National Preserve and several 
        national wildlife refuges. But this ``back forty'' is not 
        thriving. Man-made changes have profoundly altered the flow of 
        water from the Kissimmee River to Florida Bay. Water quality 
        has been degraded, wading bird populations in Everglades 
        National Park have declined by nearly 90 percent, commercial 
        fisheries in Florida Bay have collapsed, and non-native and 
        exotic plants and animals have proliferated, overwhelming some 
        indigenous species.
      Four years ago, we joined together with a broad group of Federal, 
        State, tribal, county, municipal, and special purpose agencies 
        to save the Everglades. This group is motivated by a consensus 
        that restoration of natural hydrologic functions in South 
        Florida is essential not only for the parks and refuges in the 
        region, but also for the continued health and vibrancy of the 
        economy of South Florida.
      The State of Florida has committed major resources to restoration 
        of the Everglades. In this budget, we again propose to 
        establish an Everglades Restoration Fund. Funding of $100 
        million is sought in 1998, with advance appropriations of the 
        same amount that would become available in 1999, 2000, and 2001 
        for a total of $400 million. These amounts, together with the 
        $200 million plus provided by the 1996 Farm Bill, will provide 
        an assured funding stream for critical elements of watershed 
        restoration, including land acquisition, construction of the 
        Modified Water Delivery project for Everglades National Park, 
        and scientific research.
  --On the other side of the country in the California Bay-Delta, our 
        budget addresses another, very similar problem of a stressed 
        landscape. Although not within the jurisdiction of this 
        Subcommittee, our request for the Bay-Delta demonstrates the 
        necessity for comprehensive, long-term approaches to the 
        complex and interrelated problems of an entire landscape.
      The region where the Sacramento and San Joaquin Rivers meet the 
        San Francisco Bay once sheltered a stunning variety of fish and 
        wildlife and still provides habitat for 120 species, including 
        some listed as threatened or endangered. The region is also 
        critical to California's economy, providing water to two-thirds 
        of all homes and businesses in the State and irrigating more 
        than four million acres of farmland where, among other crops, 
        45 percent of the Nation's fruits and vegetables grow.
      For the past 150 years, dredging and channelization, flood 
        control, unscreened diversions, pollution, and large-scale 
        water exports have contributed to the degradation of the Bay-
        Delta ecosystem. As a result, the Bay-Delta has reached the 
        point where it cannot reliably meet the water needs of 
        California residents, businesses, and agriculture while 
        protecting environmental resources.
      In 1994, Federal and State officials signed the historic Bay-
        Delta Accord. The Accord recognizes that a comprehensive 
        package of actions is required to strike a fair balance among 
        competing uses, restoring and protecting the Bay-Delta 
        ecosystem while strengthening the State's long-term economic 
        health. Last September, the President signed the California 
        Bay-Delta Environmental Enhancement and Water Security Act, 
        which authorizes $143.3 million a year for three years in 
        additional Federal spending for Bay-Delta ecosystem 
        restoration. The authorization became effective in November 
        1996 when California voters approved a $995 million bond issue 
        to cover State cost sharing for activities to restore the Bay-
        Delta ecosystem and for other water resources activities in 
        California.
      Our request for the Bureau of Reclamation in the Energy and Water 
        Development Appropriations bill seeks the $143.3 million 
        authorized for 1998 in the Bay-Delta Act. The requested funds 
        will be distributed among participating agencies based on plans 
        to be developed by the CALFED group, a consortium of the 
        Federal and State agencies with management and regulatory 
        responsibilities in the Bay-Delta. These funds will match non-
        Federal funding under the terms of a cost sharing agreement now 
        being developed.
  --In the Pacific Northwest, the budget proposes to continue the 
        funding for the President's Forest Plan, the first of our major 
        partnerships for restoration.
      At the beginning of this decade the northern spotted owl 
        triggered a crisis in the old growth forests of the Pacific 
        Northwest. Yet, like a sneeze, the owl was only a symptom 
        warning us that the entire Northwest forest system was sick, 
        over stressed, and in need of treatment. Science told us that 
        we needed to prescribe treatment for the whole forest, 
        providing unbroken corridors textured by a mixed canopy of 
        trees varied by age, size, and species, and maintaining wide 
        stream buffers along fish bearing streams, from headwater to 
        tidewater.
      The Plan is not just about owls, salmon, and other wildlife. It 
        directly addresses the economic issue: Healthy forests are 
        important for a healthy, forest-based economy. If we destroy 
        our old growth forest, we will lose jobs in salmon fishing and 
        tourism and eventually in our timber industry as well.
      Under the Plan, logging has been scaled back from the 
        unsustainable levels of the 1980's. At those cut levels, the 
        forests (and the forest economy) would be destroyed within a 
        generation, just as they were in earlier times in New England 
        and the upper Midwest. By scaling back to a sustainable level, 
        we ensure a steady, predictable supply of timber for loggers 
        and mills in the century ahead. And we ensure that the forest 
        towns will continue to diversify, with new people and new 
        industries seeking the quality of life and the health of the 
        natural landscape.
      The Plan is working, with the help of funding provided by the 
        Subcommittee to the Bureau of Land Management and Fish and 
        Wildlife Service. Unemployment in the Northwest forest 
        communities has hit the lowest level in generations. We didn't 
        lose 100,000 jobs, as some critics predicted, we created jobs.
      For 1998, we request $71.1 million, an increase of $2.9 million 
        over the 1997 enacted level. This level will allow the Bureau 
        of Land Management to meet its 1998 timber target of 211 
        million board feet, as part of the Plan's overall annual 
        sustainable harvest target of 1.1 billion board feet. It will 
        also allow the Fish and Wildlife Service to continue a 
        streamlined Endangered Species Act consultation process, to 
        negotiate additional habitat conservation plans, and to 
        implement the 4(d) rule, which will relieve spotted owl 
        prohibitions for 30,000 owners of small tracts of land.
    In addition to these major initiatives, the budget supports 
numerous other partnerships across the country, including support for 
numerous habitat conservation plans outside of the Pacific Northwest, 
increased funding for partnerships to clean up mine drainage in the 
Appalachian States, and start-up funding for the nine new heritage 
areas partnerships authorized by the Omnibus Parks bill. An increase of 
$1 million in the Park Service will fund technical assistance 
partnerships with communities to assess and restore watersheds affected 
by non-point source pollution and wetlands loss.
    Managing fire.--Last year, fires burned over six million acres, 
including almost five million acres in the public land states of the 
West and Alaska. As has been the trend in recent years, the wildland 
fires in forests and on ranges burned hotter, bigger, and faster--
growing ever more lethal, destructive, and expensive to fight. Two 
decades ago, we spent an average of $100 million each year to put out 
wildfires; last year we spent $1 billion.
    This explosion of fire--and cost--is in large measure the ironic 
product of our success over the past 90 years in suppressing fire. 
Healthy, low-intensity natural fires that once burned across the forest 
floor have, as a matter of policy, been ``out by 10 a.m.''
    Last February, Secretary Glickman and I released the Wildland Fire 
Policy Review directing managers to place greater emphasis on fuels 
reduction as a tool for protecting forest and rangeland resources. Our 
1998 budget addresses the practical problem of implementing this 
policy. In the Interior wildland fire account, the budget proposes an 
increase of $4.8 million for a combination of prescribed fire and 
mechanical treatment to reduce fuels. This will bring the total 
Department of the Interior hazardous fuels reduction program to $12.8 
million, which will treat half a million acres. The Forest Service 
program for 1998 is proposed to total $30 million and treat at least 
800,000 acres. This proposal establishes the foundation for a long-term 
effort to address our fuels management needs through the budget.
    Land management operations.--As has each of our budgets during this 
Administration, the 1998 budget proposes the funding we believe 
necessary to adequately operate the National Park Service, Fish and 
Wildlife Service, and Bureau of Land Management and to preserve our 
parks, refuges, and public lands so that future generations may have 
the same opportunity to experience our natural and cultural heritage 
that we have had.
    The increases requested in the budget reflect the continuing 
popularity of national park and wildlife refuge systems, as well as the 
public lands in the West; park visitation is projected at over 275 
million people in 1998, and hunting, recreation, and other visits to 
the public lands and wildlife refuges will continue to increase. The 
increases also reflect the personnel intensive nature of operating and 
maintaining 374 parks, 509 wildlife refuges, and 200 BLM districts and 
resource management units. The costs for the staffing necessary to 
provide services to the public and properly maintain natural and 
cultural resources range between 50 and 60 percent of land management 
bureau operational costs, five to six times the average for all Federal 
agencies.
    The budget proposes an increase of $65.7 million for the Operation 
of the National Park System account. This increase includes across-the-
board increases so that all parks can maintain their current level of 
services and targeted increases for 63 parks to cover new 
responsibilities and previously unfunded needs. Among the 63 parks are 
the five new areas added to the National Park System by the Omnibus 
Parks Act.
    An area of emphasis in the Park Service's operations budget is 
additional funding to maintain irreplaceable cultural and historic 
resources of the Park System. Increases are proposed for historic 
structures stabilization, cultural cyclic maintenance, and museum 
cataloguing, as well as for a Vanishing Treasures initiative. This 
initiative recognizes the highly specialized maintenance needs of the 
Anasazi and other Native American sites in the arid southwest, over 60 
percent of which have been severely impacted by weathering and erosion. 
It will provide $3.5 million to bring these resources to a point where 
they can be sustained by routine preservation treatment programs. As 
part of the initiative, the Park Service will train a new generation of 
specialists to take over the task of preserving this unique cultural 
heritage as many of the current specialists retire over the next few 
years.
    For the Fish and Wildlife Service, proposed increases in the 
Resource Management account include $13.2 million over 1997 for 
operation and maintenance of the highest priority units of the National 
Wildlife Refuge system. This will allow greater opportunities for 
compatible, wildlife-dependent recreation, reduce operational backlogs, 
and provide additional habitat restoration. Specific projects have been 
selected using a ranking system, the Refuge Management Information 
System, which will ensure the most efficient distribution of limited 
resources to meet the highest priority refuge needs.
    An increase of $11.8 million in BLM's Management of Land and 
Resources account emphasizes improvements in recreational programs at 
highly visited sites such as Red Rock, Nevada, where visitation has 
grown 13 percent a year for five years, and the strengthening of BLM's 
resource protection capabilities, including an additional $3 million 
for the cleanup of abandoned hardrock mine sites in Montana and 
Colorado, and an additional $1 million to combat invasive weed species 
that threaten the health and productivity of public lands. Funding for 
the new Grand Staircase-Escalante National Monument is proposed at $6.4 
million, an increase of $5 million over 1996 base funding for the area, 
to ensure a planning process that fully involves the people of Utah and 
other stakeholders, and to provide services for an expected increase in 
visitors.
    Increases in the MLR account are partially offset by decreases in 
other MLR programs, primarily the Automated Land and Mineral Records 
System, which is moving from the development phase to the operation and 
maintenance phase. We intend to give ALMRS its operational test in New 
Mexico this Spring and are currently planning to bring on-line all of 
the BLM States over the next 20 months. We have put in place a seasoned 
management team at this critical juncture, including the appointment of 
BLM's first chief information officer. The system holds great promise 
for providing land and mineral information to State and local 
governments, industry, and the public.
    Recreation fees.--In an era of constrained budgets, we cannot 
expect the general Treasury to meet all of the needs of our public 
lands. In 1996, the Subcommittee supported in authorizing a 
demonstration program to test fee collection levels and methods at 
parks, refuges, and public land sites. We are in the process of 
implementing that authority. Demonstration fee programs are in place at 
over 100 sites and an additional 50 sites are in the process of being 
designated. In 1998, we expect to collect over $50 million to 
supplement regular appropriations.
    This new revenue will be applied to maintenance and infrastructure 
needs to improve the quality of the visitor's experience. At the 
largest parks with the highest visitation, we will be able to achieve 
dramatic results. At the Grand Canyon, visitors on the busiest days can 
wait as many as two hours for a parking space. The experience at the 
Rim of the Canyon is one of urban traffic, not majestic solitude. With 
demonstration fee revenue, we will help provide a new inter modal 
transportation hub away from the Rim, along with a light-rail system or 
a fleet of clean, quiet shuttle buses for visitors.
    The President's budget proposes legislation for a permanent fee 
program based on the demonstration program. The budget also commits the 
Administration to work with the Congress to reform Park Service 
concession fees.
    Endangered species.--The President's budget proposes $78.8 million 
to continue our efforts to administer the Endangered Species Act to 
provide effective protection for species while minimizing economic 
effects, assuring fair treatment for landowners, and reducing delay and 
uncertainty for States, local governments, private industry, and 
individuals. This is an increase of $11.4 million from 1997.
    With the requested level of funding, the Fish and Wildlife Service 
will be able to pay for 292 projects to keep declining species off of 
the endangered and threatened lists and work on 100 habitat 
conservation plans. The Service will also be able to manage an 
increasing Section 7 consultation workload, including 38,000 technical 
assistance consultations (up nine percent from 1997), 900 formal 
consultations (up six percent), and 1,500 programmatic consultations 
(up 76 percent).
    Bureau of Indian Affairs Programs.--My biggest disappointment in 
the otherwise sound compromise on 1997 appropriations was that we were 
unable to agree on a higher level of funding for programs that support 
tribal self-determination. The claim of Native Americans to a fair 
share of attention and resources is very great, and I do not believe 
that claim was met over the past two years.
    The budget requests an increase of $114.4 million for the Bureau of 
Indian Affairs. Of this total, $76.5 million or 67 percent, is for the 
Tribal Priority Allocations budget activity, the part of the budget 
that Tribes allocate according to their own locally-based priorities. 
Among other things, this increase will allow Tribes to maintain an 
additional 1,250 miles of reservation roads; to hire another 400 law 
enforcement staff; and to fund an additional 220 child welfare cases 
each month. However, even with the increase, the overall level of TPA 
funding will be only two percent higher than it was in 1995.
    An increase of $16.8 million is proposed for elementary and 
secondary school operations to provide funds for an anticipated three 
percent increase in enrollment to a total of 52,400 and for statutorily 
mandated pay increases.
    In the President's budget, TPA and education programs together 
comprise 82 percent of the BIA operating budget. Other reservation-
based programs account for nine percent. Only nine percent of the 
operating budget pays for administration of the Bureau. In 1998, 
Central and Area Offices and other support functions are funded at a 
level about $26 million lower than three years ago, a reduction of more 
than 20 percent. The BIA's staffing level will continue at its current 
level, the lowest in 15 years.
    Office of the Special Trustee.--The budget proposes to continue 
efforts to ensure that the Federal Government fulfills its Indian trust 
management responsibilities. The 1998 request for the Office of the 
Special Trustee is $39.3 million, a $5.2 million increase over the 1997 
enacted level. With funds appropriated in 1997, the Special Trustee 
should initiate reform efforts and begin to make critically needed 
improvements to Individual Indian Money accounting systems, policies, 
practices, and procedures. In 1998, a total of $16.7 million will be 
available for continued implementation of Indian trust management 
systems improvements.
    The Special Trustee recently submitted his Strategic Plan to reform 
Indian trust management to the Administration and the Congress for 
consideration. The plan represents his views, independent from the 
Department and the Administration. I have significant concerns 
regarding the plan. Most importantly, it seems to lack a fundamental 
understanding of the relationship of sovereign tribal governments and 
Federal trust responsibilities. I am also concerned that the plan 
expands the Federal Government's investment functions and that it 
identifies large, new budget outlays without the identification of 
alternative courses of action and analysis of the cost, benefits, 
advantages, and disadvantages of alternatives.
    While I have concerns regarding the Special Trustee's plan, I do 
not want these concerns to slow our progress in improving trust 
systems. The Administration has allocated what we believe to be 
substantial resources for implementation of trust systems improvements 
during fiscal year 1997 and 1998. I intend to hold the Special Trustee 
accountable for implementing improvements. I feel confident that, 
through careful priority setting, we will be able to make the most 
critically needed reform efforts.
    The work of the Office of the Special Trustee is directed towards 
improving systems for the present and future. The question of past 
account deficiencies continues to be addressed separately. The 
Administration will shortly be sending a comprehensive report outlining 
our recommendations on settling tribal claims, and within the next few 
months, it is my expectation that we will submit a legislative proposal 
to the Congress that would establish a comprehensive process to provide 
for a fair settlement of these claims. The proposed legislation is a 
direct outcome of the five-year tribal reconciliation project 
initiated, funded, and overseen by the Subcommittee. As you know, the 
reconciliation effort did not extend to Individual Indian Money 
Accounts. In this area, we are working closely with the Justice 
Department to see if we can reach a settlement of a class action suit 
involving the management of these individual accounts.
    Science.--At the beginning of the current fiscal year, we 
successfully completed consolidation of the former National Biological 
Service into the U.S. Geological Survey. Over the years, the 
Department's earth science and biological research have provided the 
critical science needed for sound resource management. I am confident 
that the synergy between biological and earth sciences in the ``new'' 
USGS will build on and expand this tradition.
    The 1998 budget for USGS is a net increase of $5.3 million over the 
1997 level. Within this total, we propose a $9 million increase in the 
National Water Quality Assessment program that will use the NAWQA model 
to provide information on water quality conditions for streams and 
acquifers of 75 of the Nation's key metropolitan areas, including the 
largest city in each State, as part of the President's initiative to 
provide the public information about toxics. Increases are also 
proposed for better operation and maintenance of the USGS portion of 
the Global Seismographic Network and for enhanced technical assistance 
to address priority biological research needs identified by the 
Department's land managing bureaus. The USGS and its research partners 
will also refocus $1.2 million in 1998 to a program to establish 
historic mapping and modeling databases for the New York, Chicago, 
Philadelphia, and Portland, Oregon metropolitan regions.
    The increases in USGS are partially offset by programmatic 
decreases resulting from Reinventing Government II initiatives and from 
scaling back other programs, including the Water Resource Institute 
program.
                               conclusion
    I believe that the 1998 budget for the Department of the Interior 
supports priorities on which we can reach consensus. I hope that over 
the next several months we can have a dialogue to achieve that 
consensus.
    This concludes my statement. I will be happy to answer any 
questions you may have.

                            interior history

    Senator Gorton. Senator Stevens, as chairman of the overall 
committee, I will defer to you first.
    Senator Stevens. Thank you very much, Mr. Chairman.
    Would someone please give the Secretary that one piece of 
paper?
    Mr. Secretary, I must tell you that the last few months 
have been sort of traumatic, because this is your fifth year, 
is it not?
    Secretary Babbitt. That is correct.
    Senator Stevens. I spent 5 years in the Interior 
Department.
    Secretary Babbitt. And you had the good sense to move on.
    Senator Stevens. No; Mr. Nixon lost an election. 
[Laughter.]
    But while there, I worked on Mission 66, 10-year 
improvement of the Park Service. I drafted the Fish and 
Wildlife Coordination Act of 1958, which really opened up the 
conservation movement for that period of time. I lost an 
election in 1962 because I was called to be too green. Now I 
find myself trying to find some way to deal with the issues 
that affect the future of my State. So I want to show you 
something.

                          revised statute 2477

    This is a map that we had prepared with regard to the State 
and native lands of Alaska based upon the Revised Statute 2477 
problem. The shaded areas are the areas that were withdrawn in 
1980 and added to the Park System and the Fish and Wildlife 
System. The green are the rights-of-way that were identified 
prior to 1969, when your predecessor Secretary Udall withdrew 
the whole State and there could be no further rights created 
after that day under this law.
    In 1976, Congress passed an act, the FLPMA Act, that 
repealed the Revised Statutes. When we did, we added a 
provision three places in the bill that said valid existing 
rights were preserved.
    In 1994, I was informed that your office had promulgated a 
new regulation dealing with Revised Statute 2477, and I have 
asked them to give to you a sheet of paper, and I hope each 
member of the committee has one, that shows this. We put a 
moratorium in the National Highway System Act. It was placed in 
1994, but actually it did not become law until 1995. It was a 
prohibition prohibiting a regulation addressing rights-of-way 
pursuant to section 2477 as such act was in effect before 1976, 
October 1976 and that was sunsetted on September 30.
    Then we had a general provision in the 1996--September 30, 
1996. We had a general provision in the 1996 bill prohibiting 
use of funds, that is the Interior bill of this committee, and 
then we had in an omnibus bill that we passed last year, the 
omnibus consolidated appropriations bill for 1997, there was a 
general provision with no sunset which said no final rule or 
regulation of any agency of the Federal Government pertaining 
to recognition or management or validity of rights-of-way 
pursuant to Revised Statute 2477 shall take effect unless 
expressly authorized by act of Congress subsequent to the date 
of the enactment of this act.
    Now, you have not submitted any legislation, have you?
    Secretary Babbitt. I have not.
    Senator Stevens. And we have had some up for consideration, 
but we have not been able to get that out of committee, as I 
understand it.
    The problem now is that, as I understand it, you have now 
announced a new policy of revision of a 1998 policy that would 
state that on any of these rights-of-way they are valid only if 
they were created by vehicular traffic, is that correct?
    Secretary Babbitt. Senator, that is not correct.
    Senator Stevens. That is my understanding. What is the 
difference?
    Secretary Babbitt. The only action that I have taken in 
this respect was to write a letter withdrawing a letter which 
had been written by Secretary Hodel with which I disagreed and 
which did not reflect my views on this matter.
    Now, if I may clarify, there is, as you well know, a 
proposed set of regulations which have been prepared in 
considerable detail and circulated and which have been put on 
hold by this language. The regulations are currently in limbo 
pending direction or money or authorization from this 
committee.
    Senator Stevens. This is a direction to your agency. It is 
in a letter dated January 1997.

    The agency shall evaluate whether the alleged right-of-way 
constitutes a highway. A highway is a thoroughfare used prior 
to October 21, 1976, by the public passage of vehicles carrying 
people or goods from place to place. If the agency determines 
that the alleged right-of-way does not constitute a highway, 
the agency will recommend that the Secretary deny the claim.

                             rights-of-way

    Now, that puts us into a conflicting position, as I see it. 
We have several rights-of-way that were used by railroads that 
are now extinct. The Kennicott Railroad, for instance, I take 
it that we could rebuild it, the Kennicott Railroad, under your 
letter, but we could not build--let me have those little 
charts, please.
    One of these rights-of-way is out to Hooper Bay, which is 
out on the west coast of Alaska.
    This is Hooper Bay. I have been there several times. It is 
a very interesting little community. It is not totally ethnic. 
It is native and non-native. It is basically a fishing 
community. All of their access is by a road which is across 
Federal land.
    This shows even more how the airport is out here 
[indicating], and this [indicating] is their road. We want to 
improve that road. It is a Revised Statute 2477 road. It was 
created by dogsleds.
    We have a whole series of other roads that were created by 
dogsleds, particularly down in Paminto Flats area. All of these 
roads that are in here were dogsled trails. As a matter of 
fact, one of them is the historic Iditarod trail.
    Mr. Secretary, the policy that you have announced is 
guiding upon your land agencies, and accomplishes even more 
than you would by the regulation. Because it in effect creates 
a Federal position on a matter that historically has been 
determined by State law.
    The next paragraph of your letter says role of State law: 
In making its recommendation, the Secretary shall apply State 
law in effect on October 21, 1976, to the extent it is 
consistent with Federal law. The agency in no case will 
recommend approval of claims that do not comply with 
requirements of applicable State law. But, Mr. Secretary, there 
is no Federal law.
    Secretary Babbitt. Senator, there most certainly is. It is 
Revised Statute 2477.
    Senator Stevens. Well, Revised Statute 2477 was repealed in 
1976.

                             federal rights

    Secretary Babbitt. Well, but the rights that vested under 
it are Federal rights which have accrued and are in effect 
today pursuant to that law.
    Senator Stevens. But those were only determined by State 
law up till 1976. There was no Federal law in 1976 other than 
one sentence which was Revised Statute 2477. It did not have 
the word vehicular in it. You are now stating in your letter 
you are only going to recognize vehicular traffic created 
rights-of-way. That certainly was never involved prior to 1976.
    Secretary Babbitt. Well, Senator, I disagree with your 
interpretation of the Federal law. It is a stand alone Federal 
law. It does not reflect a Federal policy of deferring to State 
law. That does not appear in Revised Statute 2477, it does not 
appear in FLPMA, and it is, in my judgment, not the law as it 
stands today.
    Senator Stevens. Well, let me ask you this: Let us go back 
to my first statement. Having spent 5 years in your agency, I 
find myself now spending years combating with the agency that I 
really enjoyed serving at. Why is it we cannot get a proposal 
from you for review by Congress to establish a Federal law, if 
that is what you want?
    Secretary Babbitt. Senator, I believe that our proposal is 
set out in considerable detail in the proposed regulations.
    I would be ready and willing to do either one of two 
things, get the leave of this committee to promulgate the 
regulations, or, in the alternative, to use them as the basis 
for drafting a law to be passed by the Congress. I am ready and 
willing to do either one of those.

                        roads in national parks

    I do not accept the position, and would never support a 
Federal law which simply deferred this issue to the States. For 
example, the State of Alaska passed a statute saying there will 
be rights-of-way under State law along every section line in 
the State of Alaska. That would create 950,000 miles of roads, 
including 150,000 miles of new roads in the National Park 
System. I cannot support that.
    Senator Stevens. Now, Mr. Secretary, you have said that 
before. No national park in Alaska is surveyed. There are no 
section lines in any park in the State of Alaska. Did you know 
that?
    Secretary Babbitt. Well, Revised Statute 2477 and the 
Alaska statute does not turn on that issue. The Alaska claim is 
section lines, including 150,000 miles in national parks.
    Senator Stevens. But by definition, there are no section 
lines in national parks because you have never approved surveys 
in national parks in Alaska.
    Secretary Babbitt. Well, Senator, there are section lines. 
They have not been surveyed in many parks, as indeed they have 
not been in many parts of Alaska.
    Senator Stevens. There has never been a Revised Statute 
2477 right-of-way across a line that was not surveyed. Now, I 
am an ex-solicitor. You had better check with your solicitor. 
That is the fact. So I think we are arguing about something, 
and I would hope you would not accuse me of trying to build 
900,000 miles--do you know that all of the U.S. Federal Highway 
System is 960,000 miles?
    Secretary Babbitt. That is precisely my point. That is the 
reason we oppose Alaska's claims.
    Senator Stevens. Do you believe these gentleman are going 
to give us money for that? There are Federal highways in 
Alaska, but do you think we are going to get money for 900,000 
miles of road? Mr. Secretary, that is the kind of rhetoric that 
throws me up a tree. How can I explain to my people at home 
that I am not bringing home that kind of money? [Laughter.]
    Secretary Babbitt. Well, if that constitutes a waiver of 
Alaska's claim to rights-of-way on unsurveyed section lines, I 
certainly accept that.
    Senator Stevens. You had better hope, Mr. Secretary, that 
that State law is upheld. Because if you look at this, you will 
see that the rights-of-way to get into the national parks are, 
in fact, Revised Statute 2477 rights-of-way across State and 
native lands. The Federal Government will own 67 percent of our 
State when all of the selections are over, and the access to 
all the Federal lands requires access across the State and 
native lands. The statute was passed by the State of Alaska to 
assure that as lands went out of Federal ownership the concept 
of these lands--they are surveyed when they come out of Federal 
ownership, and the section lines are created then, and they 
give you and the people who use Federal lands rights-of-way 
across State and native lands. As a matter of fact, the Native 
people are now objecting because they seem to think that we are 
creating new rights-of-way across their lands. We are merely 
preserving rights-of-way.

               supplemental appropriations veto proposal

    But, Mr. Secretary, here is the problem, and I am taking a 
lot of time of this committee, I am now chairman of this 
committee, and I have got a provision that is in this bill 
which is no different really from the three that were already 
negotiated. And, as a matter of fact, the only difference is it 
applies to a statement of policy instead of a rule or 
regulation. You have informed me by letter that this will be 
vetoed, that our bill will be vetoed if it stays in there. But 
it is there because your Department has not proposed, as 
Congress has directed now since 1995, to create a law with 
regard to section--to Revised Statute 2477 throughout the West. 
Not just Alaska, but throughout the West.

                       rights-of-way legislation

    I am here this morning to try to see if we can find some 
way to get, and I use this word advisedly, a commitment from 
you that you will not pursue that policy, but you will pursue 
what you have just stated, and that is submitting legislation 
so that we can review it. It will go through the legislative 
committees and our committee will not have to be involved in 
this on a year-to-year basis in order to try to protect the 
rights of the West, as they see them, from an administrative 
determination of what is Federal law as compared with what 
would come. I believe, that we would pass a law which would 
state very clearly that we are not going to allow national 
parks to have roads built through them, wildlife refugees to 
have roads built through them, except to this extent, that they 
are needed for access to airports, to hospitals, to rivers, to 
the people who live in rural Alaska and rural America, and that 
there is no other right-of-way available.
    Now, I am perfectly willing to go forward and help support 
such a law. But I am not willing to go forward and allow an 
administrative letter to establish a new body of Federal law 
which, as far as I am concerned, does not exist. Now, would you 
give us a commitment that if we proceed that you will not 
pursue this policy administratively until Congress has had a 
reasonable time to review it? If we cannot get bills through, 
obviously you are going to have to do something sometime along 
the line, I am aware of that. That is why we have had these 
provisions. But that last provision is general law. You cannot 
issue the rule or regulation. You may be able to issue the 
policy statement, but I think that would lead to interminable 
legislation in every State of the West, particularly mine.
    Incidentally, Mr. Secretary, we have 1,900 rights-of-way, 
the State tells me, and the State tells me that 560 of them 
would probably be pursued by the State. So my State has already 
eliminated almost three-fourths of the rights-of-way that would 
qualify under Revised Statute 2477's existing right provision. 
Now, that may or may not be--you might not even accept the 
final 560, but we are talking about basic rights of rural 
people. We do not need these to get to Anchorage or Fairbanks 
or the airport in Juneau or Ketchican. We need to get to them 
so that we can consolidate four or five villages up there.
    There are 50 villages up there in what I call the cusp of 
the Yukon fan, a separate airport for each one. We could 
consolidate those with roads, we could have one school instead 
of four schools, we are forced into a lot of economic changes 
now in our State. But if you insist that we can only have a 
road where there was vehicular traffic, we will not have those 
highways created.
    Now, I would like to secure a way right here to, on the 
basis of a commitment from you not to pursue this policy stated 
in your letter and to work with us to create a bill--if you 
draft a bill I will even introduce it, I will tell you that. I 
will introduce the bill. I may not support it all, but I will 
introduce it and see that it comes before the Congress and see 
that we try to get this resolved for the whole West. But I 
cannot, in due conscience, hold up a bill that has got so many 
things for people who are disaster victims in the West. You 
know we have more disasters than any State in the Union. On the 
other hand, I cannot in good conscience, as Senator from 
Alaska, take it out until we get some kind of an understanding 
how we are going to proceed from here.
    Secretary Babbitt. Senator, I would be happy to deliver to 
you today a draft bill. It will consist of the final proposed 
regulations. I believe it would be an appropriate piece of 
legislation. I will deliver it to you today.
    Senator Stevens. And if I introduce that today or tomorrow, 
will you not pursue on your administrative letter and enforce 
that policy until we have had a reasonable time to consider it?

                          rights-of-way policy

    Secretary Babbitt. Senator, let me explain the purpose of 
this letter, if I may. It has become a sort of symbolic 
flashpoint for a lot of abstract disputation. The only 
significance of this letter is what should I do by way of 
response to a specific, urgent, we have got to do it now, 
application. This is not 560 applications from Alaska or 1,000 
from Utah. This is a specific we have got to have a right-of-
way right now in this township or this county. I need a policy 
by which to make those judgments. I have not been asked to make 
any, and my guess is that there will be relatively few.
    The reason that I rescinded the Hodel letter is because it 
said the policy was to pass on those applications by reference 
to State law. That is not my position.
    If I get an application, I will use this policy as an 
interim guide.
    Now, let me just say that if there is a railroad right-of-
way or a sled track or whatever in Alaska in the interim that 
needs my attention as a question not of abstract policy but 
specific need, I will consider that and I view myself as free 
to be reasonable. These guidelines talk about recommendations 
from my agencies. If you have a specific problem with a 
railroad in Alaska or something like that, I will be happy to 
respond to you in a spirit of reason designed to solve the 
problem.
    Senator Stevens. I am not sure I really got an answer yet, 
Mr. Secretary. We have only had 1 mile--1 mile--of road 
approved in Alaska as a Revised Statute 2477 application since 
1976. Did you know that? 1 mile. They are all staggered in the 
Department somewhere seeking approval.
    Now, if in the interim your people start denying our 
applications--and, by the way, most people understand that they 
are applications of my State for rights-of-way to proceed under 
the Federal Highway System. Now, I would hope that we--I see 
here--no, I do not want to get into that. I do not have time 
for that right now. That is another process. That is a problem 
with NEPA and all of the rest of it that goes in here, and that 
is another thing.
    But if in the interim your people deny my State's--any of 
my State's applications based upon this determination, then we 
have lost. Now, I want an assurance you are not going to deny 
any State application under Revised Statute 2477 while Congress 
tries to work out a new Federal law dealing with the subject. 
If you will give us that, I will introduce the bill today.
    Secretary Babbitt. Senator, I cannot give you that. But I 
think that is an abstract request, because what I am saying is 
if in the applications submitted by Alaska there are action 
items that need my attention, I am prepared to personally sit 
down with you and go through each and every one of them and get 
a reasonable result.
    Senator Stevens. Mr. Secretary, I was in the Department too 
long. You have got hundreds of people out there handling these 
applications. They are out there, out in the BLM office in Nak-
Nak or in Fairbanks or down in Utah somewhere, and they have 
got your letter. And you say you have rescinded that.
    By the way, the Hodel letter was prepared by all the 
agencies. He just signed the letter approving it. You have 
disapproved a basic memorandum of all the land agencies of 
Interior that was approved by Secretary Hodel. You did not get 
something to take its place. What you did was issue a new 
statement of a Secretary which said none of these old rights-
of-way have any validity under State law. That is the way it is 
being interpreted out there. Now, I understand you are saying 
that is not what you're saying, but your agencies are turning 
these down now.
    Secretary Babbitt. Senator, I would be happy to straighten 
out my agencies. No. 1, these issues are not determined 
pursuant to State law. They are determined pursuant to Federal 
law. We are ready and willing to pass on them under Federal 
law, and what I am telling you is I think the policy is 
reasonable.
    Now, if there are specific problems, I am willing to get 
into them, because if you have legitimate rights-of-way issues 
my job is to get them out.
    Senator Stevens. Mr. Secretary, I am sorry to say we have 
wasted our time. And I thank you very much.
    Thank you, Mr. Chairman.
    Senator Gorton. Senator Byrd.

                           rights of congress

    Senator Byrd. Mr. Chairman, Alexander Pope said--I think he 
asked a very appropriate question: Who shall decide when 
doctors disagree? Now, here we have two of my best friends in 
Government disagreeing, one in the executive branch, one in the 
legislative, one a Republican and one a Democrat. What am I 
supposed to do?
    Senator Stevens. You had better protect the rights of the 
Congress, Senator, however you do that.

                 national conservation training center

    Senator Byrd. However you do that, to the best of my 
ability.
    Mr. Secretary, rapid progress is being made toward 
completion of a National Conservation Training Center in 
Shepherdstown, WV. This is a state-of-the-art training facility 
that will benefit natural resource professionals of the Fish 
and Wildlife Service, as well as other resource managers of the 
Interior Department, and our conservation partners. It is my 
understanding that the facility will be completed this fall, 
and I am looking forward to the time when you and I both may be 
able to dedicate this training center. Is everything still on 
track with respect to the completion of the facility?
    Secretary Babbitt. Senator, I anticipate that the facility 
will be ready for use in the full sense of the word in 
September. We have scheduled a dedication, I believe, in early 
December. I intend to be there, and I can tell you that the 
staffing is going along well. We are offering courses right 
now. We will have a full menu of courses.
    Senator Byrd. And you have sufficient funds to equip the 
facility?
    Secretary Babbitt. Senator, we have a small additional 
request in the President's budget. I can give you the detail. I 
think it is approximately $4 million for the operational side.
    Senator Byrd. And you will be able to award a contract for 
construction of the third dorm?
    Secretary Babbitt. Senator, we anticipate awarding that 
contract probably about the end of the summer, and that would 
lead to completion about 1 year from then, in about September 
1998.
    Senator Byrd. To what extent is the Fish and Wildlife 
Service already signing up participants to undergo training at 
the facility once it is opened?
    Secretary Babbitt. Senator, I think that is a key question, 
because the full utilization of this center really depends upon 
a strong interagency commitment from the Corps of Engineers and 
the Department of Defense, Forest Service, and marine 
fisheries. The Forest Service has a full-time program officer 
now assigned to the center, and that is reflected in the 
training courses. Obviously, we have high hopes that courses 
will continue to develop--I believe they will--on a 
reimbursable basis.
    Senator Byrd. I understand that it is already booked to 
full capacity for fiscal year 1998, for the 100 dorm rooms that 
will be available. Is that true?
    Secretary Babbitt. Senator, I am not absolutely certain, 
but I will check that out and get back to you. I am satisfied 
that we have a strong menu of programs and reservations. I am 
not sure of the exact number.
    [The information follows:]

                 National Conservation Training Center

    The total number of participants scheduled for classes at 
the National Conservation Training Center (NCTC) in fiscal year 
1998 at the present time is approximately 5,064. This 
translates into approximately 25,320 student days. The NCTC 
housing capacity for fiscal year 1998 is 100 rooms, which 
translates into 25,000 student days. Overflow students will be 
lodged at hotels in Shepherdstown, WV and will travel to NCTC 
during the day for courses. Approximately 500 NCTC participants 
have booked offsite accommodations in fiscal year 1998 at this 
time.
    The NCTC has additional classroom space available, and 
continues to discuss facility usage opportunities with 
interested parties, with the understanding that these 
participants would use offsite lodging. The addition of a third 
lodging unit will increase the use of these additional 
facilities. As students begin to arrive in September, we are 
confident that word of the facility will quickly spread, and 
customer demands will increase rapidly.

                                training

    Senator Byrd. You mentioned some of the agencies with which 
the Fish and Wildlife Service have been working in order to 
ensure that the training center will be used fully. Will these 
agencies cover their costs when they use the facility?
    Secretary Babbitt. Senator, that is our intention, to, in 
effect, operate this on a cost-sharing basis, with the agencies 
reimbursing their proportionate share of room, board, and 
tuition, if you will.
    Senator Byrd. To what extent has the Service already begun 
outreach and conducted training with the parties that will be 
using the center once it is completed?
    Secretary Babbitt. Well, we are under way with the training 
curriculum. I might also add that we have had a good response 
in the nongovernmental community. We have been working with the 
Conservation Foundation and others to see if we can put up a 
nongovernmental set of programs. We actually have some of those 
courses and some utilization under way right now. I think it is 
an important component.
    Senator Byrd. What kind of feedback are you getting from 
the participants?
    Secretary Babbitt. Senator, it is very positive. It is an 
extraordinary facility, and it is really working very well. One 
reason is that we actually can get people to the training 
resources but keep them out of Washington, which is a major 
benefit. What it means is you can really have a training 
program rather than people hanging around. There is no where to 
go when class is over except back to your dorm and to the 
dining hall, and it is perfect for training, perfect.
    Senator Byrd. Mr. Secretary, you are preaching the sermon I 
have been making for many years here, in the face of some 
obstinate critics. And I think you and I are both right, as we 
will prove it at Terrapins Neck in Shepherdstown, which is the 
oldest city in the State of West Virginia.

                 canaan valley national wildlife refuge

    Let us shift just a moment now to Canaan Valley. In recent 
years Congress has provided funding at a rate of about $2 
million annually to allow for continued land acquisition in 
support of this, which is our Nation's 500th national wildlife 
refuge, located at Canaan Valley. This year there is no funding 
requested to continue the acquisition program. Has all of the 
land within the designated boundaries of the refuge been 
acquired? If not, how many acres remain to be acquired?
    Secretary Babbitt. Senator, there is a substantial amount 
of land to be acquired. I think about 20,000 acres. But as you 
know, the land acquisition budget is a complex issue. The 
priorities are fought over internally, externally, in the 
appropriation process, and the rank ordering this year does not 
include acquisition funds. We need, I think, probably about $40 
million to complete the process over the coming years.
    Senator Byrd. And at the rate we have been going, that 
would require 20 years, $2 million a year. Are there willing 
sellers interested in selling their land for inclusion in the 
refuge?
    Secretary Babbitt. Yes; there is no problem on that score.
    Senator Byrd. If additional funds were provided, then, to 
continue with the acquisition program, would the Department be 
able to expend these dollars to acquire additional land for the 
refuge?
    Secretary Babbitt. Yes.
    Senator Byrd. An increase of $85,000 is proposed in the 
budget to begin habitat evaluation and monitoring. Will the 
increased funds proposed in the 1998 budget be sufficient to 
allow a custodial level of refuge operations to be established?
    Secretary Babbitt. Senator, that is a difficult question, 
because we have that question at every single unit of the 
national wildlife system. The levels of supervision and 
management at most refuges are premised on a relatively low 
visitor demand. What we are finding, of course, is that the 
visitation to refuge units is bumping up very rapidly and we 
are kind of behind the curve. So I think the answer is we think 
at the proposed level that we can protect the resource. It is 
not ideal.
    Senator Byrd. What level of funding would be necessary to 
establish a base staff located closer to the refuge and begin 
the necessary activities associated with managing a refuge, 
habitat protection, monitoring of fish and wildlife 
populations, visitor contacts, and development of partnerships, 
and so on.
    Secretary Babbitt. Senator, I would have to answer that in 
writing, which I would be happy to do.
    [The information follows:]

                 Canaan Valley National Wildlife Refuge

    New refuges progress through different activity levels as 
staff, land, and facilities are acquired over time. New refuges 
start at a custodial level of operation, providing protection 
and preservation of a limited number of public trust resources 
as directed by the station's establishing legislation. Staff 
initially focus on habitat stabilization, biological 
inventories, and development of partnership activities with the 
local communities to support public use and biological 
management goals. A custodial station has up to three staff, a 
refuge manager, maintenance worker, and an administrative 
assistant and may operate from local rented space, or a 
remodeled building purchased in the course of land acquisition.
    Initial start up costs include funds to develop a 
Comprehensive Management Plan, with full public involvement, 
baseline biological and Archaeological Resources Protection Act 
(1979) surveys, as well as office furnishings and refuge signs.
    Base funding for Canaan Valley NWR was created by leaving 
positions vacant at other refuges. Delayed hires at most 
stations have ``spread the pain out,'' primarily having an 
impact on public use and habitat restoration programs. Base 
funds cover only the Refuge Manager's salary and other small 
office expenses. The office is co-located with the West 
Virginia Field Office, 35 miles from the refuge in Elkins, WV.
    The Service has identified $500,000 as the level of funding 
needed for Canaan Valley NWR to operate at full capacity. This 
level of funding would enable the refuge to hire a maintenance 
worker, a refuge operations specialist, an administrative 
assistant, and an outdoor recreation planner. It would provide 
basic biological equipment, vehicles and office furniture. With 
these funds the refuge staff would gather basic biological data 
necessary for the development of a Comprehensive Management 
Plan, and archaeologists would conduct an initial 
Archaeological Resources Protection Act survey. The funds would 
also provide information kiosks and designated parking areas 
for hikers, wildlife watchers, and hunters. The funding would 
enable the Service, with assistance from the State, to 
establish a more fully functioning refuge by protecting unique 
natural resources, providing for appropriate public use, and 
educating the local community and tourists alike about the 
wetland and wildlife values of Canaan Valley.

                         canaan valley funding

    Senator Byrd. If the budget deal provides additional 
resources but directs them to land acquisition only, how would 
the Department manage the additional responsibilities that 
accompany the owning of land if increased operational dollars 
are not forthcoming in the next several years?
    Secretary Babbitt. Senator, it depends on the nature of the 
land acquisition. To the extent that we are acquiring in-
holdings in existing units, it does not necessarily translate 
into additional administrative expense. To the extent that we 
deal with the New World Mine issue at Yellowstone, that gets 
folded into the base of administration in the Gallatin National 
Forest. To the extent that we do the headwaters deal in 
California, well, I do not know. That would probably be an 
additional expense. I think it depends very much on the nature 
of the land acquisition and whether or not you are creating a 
new unit or simply folding into an existing one.

                      harper's ferry national park

    Senator Byrd. What is the status of the recovery efforts at 
Harper's Ferry?
    Secretary Babbitt. Senator, we are moving along pretty 
well. I was up there with Mr. Stanton some months ago, and it 
is by no means finished. But I believe we have sufficient 
appropriations to in fact finish the job.

                       george washington parkway

    Senator Byrd. In response to concerns about safety along 
the George Washington Parkway, and I drive it every day, twice, 
the National Park Service announced a plan to proceed with a 
number of improvements intended to improve safety, and they are 
certainly needed. What is the status of the Park Service's 
efforts to make some of these safety improvements, and have the 
necessary concurrences been obtained so that the work can 
proceed?
    Secretary Babbitt. Senator, I believe we are under way with 
the median modifications--that is the barriers. I do not know 
whether they are jersey barriers. I am not sure it will be nice 
stonework.
    Senator Byrd. Yes; that work is under way.
    Secretary Babbitt. That is under way. I think we are OK on 
that front. We are also stepping up patrols out there, because 
for reasons I do not fully understand it is a little out of 
hand. I do not know why that situation developed, but we are 
attempting to do both things, get the median barriers up and 
increase the patrols.
    Senator Byrd. What funding is necessary to address the 
safety concerns in a more permanent manner?
    Secretary Babbitt. Senator, I cannot answer that. I would 
be happy to do that in writing.
    Senator Byrd. Very well, if you please.
    [The information follows:]

         George Washington Memorial Parkway Safety Improvements

    The George Washington Memorial Parkway needs approximately 
$90 million to complete all safety and rehabilitation 
improvements. This estimate is based on an engineering study of 
the George Washington Memorial Parkway completed by the Federal 
Highway Administration in 1989. The estimated cost for 
improvements in that study totaled $95,443,832. This figure 
includes the cost to make improvements between Spout Run and 
Theodore Roosevelt Bridge at $6.2 million dollars and permanent 
safety improvements to the roadway from Spout Run to Route 123 
($16 million), the area where most of the accidents have 
occurred. The 1989 study will be updated soon to more 
accurately reflect the needs and costs since it has been almost 
10 years since the study was last completed.
    The 1989 study recommended a variety of improvements and 
rehabilitation that is too lengthy to include. The study is 
three volumes long and upon request a copy can be made 
available in a matter of days.
    Finally, additional operations funding in the amount of 
$650,000 is also needed to increase law enforcement patrols by 
U.S. Park Police from three patrol units to five. This will 
enable the Park Police to hire an additional 10 officers to 
fill critical personnel needs which currently exist at the 
George Washington Memorial Parkway station. A more consistent 
police presence would be maintained and monitoring and response 
to incidents will be increased.

                  eastern shawnee tribe trust petition

    Senator Byrd. Mr. Secretary, thank you, and I want to thank 
the chairman for yielding to other members. It goes to show how 
much of a responsibility the chairman really has when he stays 
and listens to all the other members and then has to pose his 
questions at the last. Thank you very much.
    Senator Gorton. Thank you.
    Senator Bond.
    Senator Bond. Thank you very much, Mr. Chairman.
    Mr. Secretary, what is the current status of the trust 
petition of the Eastern Shawnee Tribe with respect to the land 
in Missouri?
    Secretary Babbitt. Senator, it is under consideration in 
the Bureau of Indian Affairs.
    Senator Bond. Now, what does that mean? Are you going to 
have--is the decision going to be made there, or are you going 
to make the decision at your level?
    Secretary Babbitt. Senator, let me say the decision will 
not be made without my careful attention in the device and 
input.
    Senator Bond. What are the key factors that you as 
Secretary must take into consideration in acting on a petition 
such as this one?
    Secretary Babbitt. Senator, the key factor, of course, is 
the applicable laws enacted by this Congress. I know you do not 
take much consolation in that because the laws are not entirely 
consistent, and they are fairly vague.
    The real issue here, it seems to me, is of a law that 
relates to the acquisition of land to be taken in trust for 
gaming purposes. If those acquisitions are made after a cutoff 
date in the law, I believe that gubernatorial concurrence is 
required.
    Senator Bond. Does it also require reference to the views 
of other public officials and the constituents in the area?
    Secretary Babbitt. Senator, there is a series of 
regulations that the Bureau uses in assessing it, and I believe 
that is in fact one of the written criteria in the regulations, 
yes.
    Senator Bond. Is it of significance that there are no 
recognized Indian tribes in Missouri, no land-based casinos in 
Missouri, and the Missouri constitution does not allow land-
based casinos? Is that a relevant consideration?
    Secretary Babbitt. There is not a specific criterion of the 
nature you describe, but I think it all falls into the Bureau's 
obligation to assess the opinions of the affected community.
    Senator Bond. In our prior discussion, we talked about the 
desire of the Missouri congressional delegation, particularly 
my colleague Senator Ashcroft, and the Congressman from the 
area, Congressman Roy Blunt, to meet with appropriate people in 
the Department of the Interior prior to a final decision. Can 
you give us some idea when would be the appropriate time for 
such a meeting? When will the matter ripen to the stage that we 
could present our case to the Department?
    Secretary Babbitt. Senator, you are speaking to the 
appropriate official to meet with, and I have committed to you 
that I will do that. I will get back to you in writing about 
timelines. This issue is not at the front of the pipeline right 
now, but I will give you plenty of notice, and we will have a 
chance to discuss this.
    Senator Bond. Good.
    Mr. Secretary, I understand after all the discussions we 
have had, the many, many diverse issues that you have to deal 
with. And frankly, having talked with several of my colleagues 
both who serve on this subcommittee and elsewhere, I realize 
how serious a question this is in many States. And I can tell 
you that having visited the area concerned around Seneca, MO, 
and areas around Nixa and Christian County where there have 
been other purchases by Indian tribes, the fear, the concern, 
and the outright opposition of the people in those areas to 
what they view as a real and serious threat to the quality of 
their life makes this a top priority for me. And from what you 
have said, and I understand that the statute is vague and not 
consistent, I look forward to an opportunity to work with my 
colleagues to draft an improvement to that statue so that with 
all of the other challenges you face you will not be forced to 
apply what may be a vague or inconsistent statute in matters 
where the whole lifestyle of the community, the well being of 
the community, is at risk.
    I think legislation clarifying, tightening up, and making 
clear the rights of the people to be free of casino gambling is 
something that we should seek to achieve. We would welcome your 
input and your guidance on doing it, but I think this is so 
serious that we also must pursue a legislative solution, based 
on what you have said.
    Secretary Babbitt. Senator, I would only add that you 
should also be working closely with the Governor, because he 
does have a veto power under the statute.
    Senator Bond. I have no doubt that he will use that.
    Thank you very much, Mr. Chairman and members of the 
committee, I appreciate the time.
    Senator Gorton. Senator Reid.
    Senator Reid. Mr. Chairman, I would also just give a word 
of advice to my friend, Senator Bond, before he leaves. Good 
luck with the legislation. We have been trying that for a lot 
of years.

                              nevada land

    Mr. Secretary, I say to everyone here Senator Stevens 
lamented the fact that he would wind up with 63 percent of his 
State owned by the Federal Government. Of course, as you know, 
87 percent of the State of Nevada is now owned by the Federal 
Government.
    Mr. Secretary, I am not going to go into the many things 
that I think have occurred during your tenure as Secretary of 
Interior that have been helpful to the State of Nevada. You 
have been very good to the State of Nevada, and I acknowledge 
that and appreciate it. I have enjoyed working with you. But I 
do say that my concern, and I would like to direct your 
attention and the committee's attention to this, is that we 
have some things that we need to look at on a funding level.

                    nevada bureau of land management

    I am very concerned about the Bureau of Land Management in 
the State of Nevada. I am concerned because we have the land 
and realty fund on a national level being reduced, and as you 
know, with the rapidly growing area of Las Vegas, we simply 
have not been able to meet the demands of the people in 
southern Nevada who need things done by the Bureau of Land 
Management. It is overwhelming, and if there is one negative, I 
get more complaints about the Bureau of Land Management in Las 
Vegas than I do the Internal Revenue Service, and the big 
complaint is they do not have people to do the work.
    Processing is behind in not a matter of weeks, months, but 
years, and I have tried to work with the State office about the 
understaffing, and this is a quote, ``they just do not have 
enough funds for additional people.'' But I would direct the 
Secretary's attention to the fact that there the State office, 
the office 500 miles from Las Vegas, has been increased by $2 
million, while Las Vegas has not been.
    So I would ask that you would personally take a look at the 
misapplication of funding of the Bureau of Land Management in 
Las Vegas. Would you do that?
    Secretary Babbitt. Certainly.
    [The information follows:]

                 Funding Allocations to Southern Nevada

    Recognizing the importance of being responsive to the 
increasing demands for services in southern Nevada, the Bureau 
of Land Management has taken a number of positive steps 
outlined below:
    Organization and Budget.--Through the Nevada reorganization 
in 1996, the administration of about 4.3 million acres of 
public land in what was formerly the Caliente Resource Area of 
the Las Vegas Field Office was transferred to the Ely Field 
Office. This had a very positive effect on the Las Vegas Field 
Office in that there were no reductions in Las Vegas personnel 
as a result of that change, and the Las Vegas Field Office 
could then focus its efforts on urban issues. Between fiscal 
year 1995 and fiscal year 1997, the appropriated budget for the 
Las Vegas Field Office was increased by 22 percent. An 
additional $2 million in contributed funding was also utilized 
to support the Las Vegas Field Office during that timeframe.
    Recreation Program.--Las Vegas is initiating fee collection 
at the Red Rock National Conservation Area. One hundred percent 
of the revenue that is generated at the fee site will be 
returned to the Las Vegas District to augment its resources for 
management of the recreation program.
    In fiscal year 1997, $539,000 was appropriated for the 
remodeling and upgrading of facilities at the Red Rock Visitor 
Center. Some of this work being completed with this funding 
includes remodeling of the visitor exhibit, audio tour 
replacement, access road enhancement, gates and new signing, 
and computer system upgrade. The existing restroom will be 
remodeled and a new restroom facility added in 1998. Design 
work has been completed and a plan approved for the phased 
construction of a new Visitor Center that will enable BLM to 
accommodate the increasing public use of the facility. Initial 
work on that facility is expected to begin in 1998 pending the 
availability of construction funding.
    Partnerships continue to play a key role in the public 
services provided at Red Rock. A partnership with the Clark 
County School District has allowed BLM to utilize local 
teachers in providing interpretive programs for area students. 
The Friends of Red Rock volunteer organization provides 
valuable assistance to BLM in areas such as signing and trail 
maintenance and construction. The Red Rock Interpretive 
Association, which is working with BLM to develop a new 
visitor's exhibit, continues to play a very important role in 
providing quality visitor information. Improvement of the space 
for the Interpretive Association is a very high priority for 
BLM at the Visitor Center.
    Lands Program.--The Las Vegas Field Office has one of the 
BLM's most complex land and realty programs, given the 
pressures resulting from the rapid growth in population and 
associated demands for public land. Much of the casework 
involves complicated legal issues which frequently require 
close coordination with the regional solicitor's office.
    Seven new positions have been added to the lands staff in 
the Las Vegas Field Office. Four of those positions have 
recently been filled, and selection is pending on the remaining 
three. In addition, Nevada Power has placed an individual in 
the Las Vegas office full time to assist in the processing of 
right-of-way applications. Las Vegas will be looking to extend 
this opportunity to other entities that have numerous 
applications pending and who may want to assist us in 
expediting the processing of those actions. Las Vegas also 
continues to work with its major clients to prioritize pending 
workloads, so that BLM can be responsive to their individual 
needs.
    Significant progress continues to be made in the processing 
of lands transactions such as exchanges and Recreation and 
Public Purposes leases to meet the growing demand for land for 
community development, schools, and parks. A moratorium was 
placed on new land exchanges in fiscal year 1997 to enable Las 
Vegas to concentrate its efforts on six pending high priority 
exchanges. One major land exchange has been completed, as have 
the first phases of two others. Close work with Clark County 
and the other local governments has resulted in increased 
coordination on land tenure adjustments, data sharing for GIS, 
flood control and other right-of-way needs.
    In anticipation of continuing demands for the disposal of 
lands in the Las Vegas valley, all lands identified for 
disposal in the land use plan have been segregated from mineral 
entry. Similar action is being taken for public lands in the 
Laughlin and Mesquite areas. The Las Vegas office is also 
working hard to meet the increasing needs of the local 
government and the public for sand and gravel for construction 
purposes.
    Process improvements (e.g., programmatic environmental 
assessment, cultural resource agreement, desert tortoise 
agreement) continue to be developed within the lands program to 
expedite case processing and meet customer demands. Increased 
emphasis is being placed on the use of outside consultants in 
the preparation of environmental work. In addition, other 
agencies such as the Forest Service and Fish and Wildlife 
Service are being tasked with some of the work required to 
process lands transactions such as exchanges where they are the 
beneficiary.
    Las Vegas expects to have achieved a 50-percent reduction 
in right-of-way case backlog by the end of this year. This has 
been accomplished through the diligence of the current staff as 
well as the efforts of several individuals who were temporarily 
detailed from other BLM offices to assist. In addition, a GS-13 
employee with extensive realty experience was assigned to the 
Las Vegas for about a year. During fiscal year 1996, $200,000 
was added to Las Vegas' budget to fund these details. State 
Director priorities for fiscal year 1998 provide for continued 
assistance from other offices as necessary to further reduce 
the backlog of realty actions.

            wild horses program funding versus parks funding

    Senator Reid. I would also say that one of the things, Mr. 
Secretary, that just--I do not know how else to say it other 
than we spend $17 million a year, and I say that to the 
committee, $17 million a year on wild horses; over 10 years, 
$170 million. We have problems throughout government dealing--
and I understand the importance of wild horses and how 
difficult the problem is to work with, and I am not diminishing 
the importance, but we have people--people--that are suffering. 
We have problems in our national park in Nevada, in our 
recreation areas, people do not have places to go to the toilet 
in our recreation areas and our national parks.
    I have been trying to get a few dollars each year out of 
this committee so that we can put in new toilets. I hate to 
harp on this subject, but when you have an area that is growing 
by 7,000 people a month and they are going up into Mount 
Charles and Red Rock and these other recreation areas that we 
have a responsibility to take care of, and I explained to them 
we are spending $17 million a year on horses, wild horses, and 
we cannot provide money for people to take care of their basic 
needs, something is wrong with the process.
    I do not know what we are going to do. I have devoted 
tremendous amounts of my time to this wild horse program. We 
tried these sanctuaries for them. That was a big flop. We have 
tried doing something on birth control of horses, and that was 
also a flop. And so for $17 million a year, we have got to take 
a look at this program. It just simply is a failure. It is not 
working. And I know we are now trying to auction the horses, 
and that may work a little better, but without going into a lot 
of detail here today, we need you, this Interior Department, to 
give us some relief on this horse problem.
    The reason I am so concerned is the vast majority of the 
horses, maybe as many as 80 percent of the horses, are in 
Nevada. And we did not get nearly that much of the $17 million 
spent there. I think frankly a lot of the $17 million goes to 
other programs than for the wild horses.
    So I would hope that we would take a look at the inequality 
of the distribution of moneys we passed with this committee 
last year and ask you to come back with a report as to why the 
inequality was so pronounced. That was knocked out in 
conference, but I think in fairness you still should have come 
back to this committee with that information.
    I have asked a series of questions, rambling in nature, as 
much as I hate to acknowledge it, but these are concerns that I 
have that really need your personal focus.
    Secretary Babbitt. Senator, I will do my best to respond. 
The wild horse and burro issue is very simple. These are very 
prolific creatures. The fertility rate among the horses in your 
home State of Nevada is approximately 18 percent.
    Senator Reid. We have some people that are prolific, too, 
and they need some money, too.
    Secretary Babbitt. Well, the horse issue is very 
impressive.
    There are only two ways of dealing with this issue that 
have proven to be acceptable to the public, adoption, which is 
a very complex and very expensive process, and contraception 
which we are struggling with. I mean, surely, we ought to be 
able to find an effective contraceptive agent. I will do my 
best to personally see if I can have a look at these issues. 
They are complex.
    [The information follows:]

                      Wild Horse and Burro Program

    The Bureau of Land Management places a high priority on 
ensuring that appropriated funds for the wild horse and burro 
program be expended in direct support of the program. In 
February 1997, the Office of the Inspector General (OIG) 
released its report on ``Expenditures Charged to the Wild Horse 
and Burro Program, Bureau of Land Management'' (No. 97-I-375). 
The purpose of the report was to review and determine whether 
the BLM expenditures charged to the wild horse and burro 
program were spent for activities related to the program. In 
that report, the OIG concluded that BLM had recorded and 
generally spent funds for program purposes in accordance with 
its accounting procedures.
    In fiscal year 1997, the rangeland management; soil, water 
and air; and riparian programs provided financial support to 
facilitate wild horse and burro management. These funds were 
used to implement gatherings which will aid in restoring 
rangeland health.
    Nevada currently provides habitat for approximately, 56 
percent of the wild horses and burros living on public lands 
(1996 national population: 42,138; 1996 Nevada population: 
23,483). This percentage has decreased during the past five 
years as Nevada makes progress on reducing wild horse and burro 
populations to within appropriate management levels. Nevada 
typically is funded to remove 66 percent of the total excess 
animals removed each year Bureauwide. In all states except 
Nevada, the wild horse and burro funding covers the cost of 
field management, gathering, preparing the animals for 
adoption, and adoption. Nevada receives funding for the 
management of wild horses and burros on the ground and for 
gathering of excess animals. The costs for preparing Nevada 
wild horses and burro for adoption and adopting them are born 
by other offices. In particular, the Eastern States Office 
adopts virtually all of the excess animals removed from Nevada 
rangeland.
    Because of the large population of wild horses and burros, 
Nevada has been and will continue to be the focal point of the 
program. During the past five years, all BLM funded research on 
fertility management, development of a population model and 
studies of birth and mortality rates have been conducted in 
Nevada.

                            funding problem

    Senator Reid. Without airing all of our linen here before 
the committee, I also would ask you to take a look at this 
funding problem we have in the State. It is just simply unfair, 
unfair to the business community and southern Nevada, and I 
think unfair to the Federal Government to get so much bad 
feeling as a result of I think a misapplication of funding.
    Senator Gorton. Thank you.
    Senator Campbell.
    Senator Campbell. Thank you, Mr. Chairman. I have a couple 
of questions, but time is running on. I would like to submit 
them to the Secretary, concerning PILT and MMS.
    Senator Reid. Would the gentleman yield? I also ask 
permission to submit a number of questions in writing to the 
Secretary.
    Senator Gorton. Each member will have that right.
    Senator Campbell. I would like to associate myself with the 
comments of Senator Reid, and later on with Senator Bond, too.

                              wild horses

    Mr. Secretary, you come from the West, and I do not think 
anybody needs to tell you how bad the wild horse problem can 
get. We have sort of a national love affair with the horses. 
Heck, we raise them on our ranch. I am sure you did, too. And I 
do not think anyone supports the kind of mistreatment that we 
have heard about or read about in newspapers, the horse 
roundups and the abuse of them when they are going to the 
killers and so on. But by the same token, you go out in that 
western country, and you said yourself, 18 percent growth rate 
per year, it is just tearing up a lot of country, and those 
wild horses, particularly stallions, can do an awful lot of 
damage, as you know.
    About 5 or 6 years ago, we recommended to the BLM that they 
initiate a process of neutering at least the stallions. And I 
do not know if that was ever even implemented, frankly, but my 
gosh, we do it on our ranch when we are raising horses, and it 
is not that big of a deal. I cannot understand the amount of 
money we are spending, $17 million a year, on this horse 
problem and it is getting bigger all the time, why we cannot 
implement that. But I just wanted to throw that in, since 
Senator Reid had brought that up.

                       tribal self determination

    I would like to say that I certainly appreciate your 
mentioning the BIA, and would hope that through your efforts 
that we prioritize those programs which help tribes become more 
self sufficient through economic enterprises. And I know that 
many tribes are doing that, with the help of the Bureau. Some 
are doing it in spite of the Bureau. But I think that is the 
new direction that they want.

                             indian gaming

    I also would like to maybe mention a couple of things 
concerning Senator Bond's comments, I guess because I chair the 
Indian Affairs Committee. I am obviously a big supporter of 
self determination. But the issue Senator Bond is talking 
about, I really worry about it setting a bad precedent, ending 
up pitting tribes against tribes, and I think that it really 
makes the 1988 Indian Gaming Act somewhat unstable. That act 
required compacts between States and tribes, and it seems to me 
that the issue that Senator Bond was talking about is the 
equivalent of one State acquiring land in another State, and 
then annexing it for the purpose of starting a casino, and 
there is just something wrong with that, and I hope you take a 
very careful look at that and recognize it could create some 
real problems of tribes trying to leapfrog over each other, 
strictly buying land or getting it in whatever way, putting it 
in trust for the purpose of starting a casino in downtown 
Minneapolis or somewhere else. I think that that could create 
more problems than we want to deal with.

                              rim rock run

    I know you are involved all the time in some very, very 
difficult issues that require an awful lot of study and a lot 
of difficult decisionmaking. But I had one that is not really 
probably specific or urgent on your list, but it is on ours. 
Senator Allard and I are going to have a meeting with the 
interim head of the Park Service this Wednesday concerning it, 
but I would like to make you aware of it and see if I could get 
your help on it.
    In Colorado, in the Colorado National Monument, every year 
for over the last 10 years there has been a marathon run called 
the Rim Rock Run, and it is similar to the ones that are done 
in many other places. Here in the District of Columbia we have 
the Marine Corps Marathon and in Hawaii they have the Iron Man 
Marathon, and these things are not really uncommon. The Park 
Service has lent themselves to these things a number of times.
    Well, just this year, rather unexpectedly, the 
Superintendent decided that this run was not within the mission 
of the Park Service, and denied the application to the runners 
that put this run on. This is in Colorado National Monument 
near Grand Junction. It has been done many, many times, has 
terrific support by the community, and is a great attraction. 
It does not damage or degrade the area at all, as near as I can 
tell, and what we are going to ask is to try to find a solution 
to this. We do not want to do something that is not in keeping 
with the Park Service, but since this is done very often we are 
going to ask the head of the Park Service if he would give them 
a 1-year conditional approval to run it this year, and on the 
condition that the runners come up with some kind of a plan, 
submit a plan, that is compatible with the Park Service for any 
succeeding permits to run it. Is that something you could 
support in giving us conditional 1-year interim approval?
    Secretary Babbitt. Senator, that seems like an entirely 
reasonable approach. I think you are correct that this is not 
an issue of degrading the park resources. As I understand it, 
this marathon is being run on the main road outside of Grand 
Junction.
    Senator Campbell. On the pavement, that is correct.
    Secretary Babbitt. And I think what the Superintendent was 
concerned about was simply shutting down the access to the 
public for the time that the marathon was run. I concede that 
that is the only issue.
    Senator Campbell. And that may be true. It might for a few 
hours. In that country it is great for runners and cyclists. As 
you might guess, the State of Colorado, as an example, just 
about 100 miles from there, going from Durango over the top of 
the Red Mountain Pass, they close the State highway for a half 
a day for a bicycle marathon. It does not seem to upset many 
people. I mean, the number of people that are attracted to it 
and are enjoying it far outweigh the few people that might have 
been discomforted.
    Secretary Babbitt. As long as they are not doing it for 
motorcycle marathons.
    Senator Campbell. Unfortunately, they are not given the 
same kind of consideration, but bicycles and running seem to 
get it. But I did want to ask you that, and I wanted you to 
know that this is not a permanent thing, it would be just a 1-
year conditional access to it so we can get this thing done 
this year and then sit down when we have more time to try and 
find a solution that is compatible with both the Park Service's 
mission and to see if we could keep that run going.
    Secretary Babbitt. Senator, that is a reasonable request. I 
would be happy to join you in petitioning the independent 
sovereign nation of the National Park Service. [Laughter.]
    Senator Campbell. Thank you very much, Mr. Secretary.
    Thank you, Mr. Chairman. That is the only question I had.
    Senator Gorton. Senator Bumpers.
    Senator Bumpers. Thank you, Mr. Chairman.

                      revised statute 2477 history

    Mr. Secretary, first of all, let me say that I regret being 
late this morning. I understand I missed a very interesting 
question and answer session. And I just want to say that you 
are on the side of the angels. I know that the administration 
does not intend to back away from their opposition to the 
Revised Statute 2477 concept, and to remind you that we came 
within two votes of taking that position in the U.S. Senate. 
Because of extrinsic matters that had nothing to do with that, 
we lost by two votes. As I say, I know you are going to hang 
tough on that.

                           budget resolution

    On another matter, the budget committee has reported out a 
budget. This budget does not make any reference to what so-
called corporate welfare programs, or corporate loopholes, are 
going to be closed to offset $50 billion of the gross tax cuts. 
To rephrase it so the record will be clear, it is my 
understanding we are going to cut taxes by $115 billion gross.
    Senator Gorton. $135 billion.
    Senator Bumpers. Oh, that is right, $135 and a net of $85, 
and the difference is going to be made up by reinstating the 
airline ticket tax and another $20 billion from somewhere. 
There is no reference in the budget as to what those might be, 
not even the airline ticket tax.

                            mining royalties

    I assume that during the negotiations between Senator 
Domenici and some of his colleagues with the President, at some 
point you were called upon for your input into that whole 
process. I am curious as to whether or not, if you know, 
reclamation fees, mining royalties, elimination of the 
depletion allowance, maintenance fees, I wonder if any of those 
things were discussed, and where we are going to find this $50 
billion.
    Secretary Babbitt. Senator, I really do not know the answer 
to that question. We have had, obviously, continuing 
discussions with the Office of Management and Budget about the 
fiscal implications of reforming the Mining Act of 1872. I am 
not entirely clear how that translates into the so-called 
razors in the budget agreement.
    Senator Bumpers. The President's budget requested a 5-
percent net smelter royalty on unpatented land which is worth 
$175 million. The President also asked for an extension of the 
claim in maintenance fees, which is worth $135 million, and 
elimination of depletion allowance which is worth $468 million. 
Now, if the President asked for those things in his budget, it 
seems only reasonable he would want those items to be used when 
determining where the $50 billion in loopholes were going to be 
closed. Would you agree with that?
    Secretary Babbitt. Absolutely.
    Senator Bumpers. And you agree with it?
    Secretary Babbitt. The time is surely at hand for dealing 
with the necessary changes of the Mining Law of 1872.
    Senator Bumpers. In all fairness, Mr. Secretary, a number 
of Senators from Western States have told me, and hopefully we 
are going to meet this week or possibly next week to sit down 
and see if we can reach some sort of an accommodation on that. 
I do not want to be derogatory or anything, but they seem 
really genuinely concerned about trying to work out a solution 
to this, and certainly I am going to operate in good faith, and 
I trust that they are, too, and perhaps we will be able to 
resolve something.
    Now, my bill, as you know, adds a reclamation fee which you 
did not ask for. That is worth $750 million over the next 5 
years.
    Well, Mr. Secretary, I am not going to belabor this. I 
think you are doing an outstanding job. Your tenacity on 
Revised Statute 2477 lands, on mining, on mining fees, 
royalties, reclamation, all of those things, is most admirable. 
And I hear comments around here, well, I do not trust the 
Secretary. I trust you implicitly and I think you are doing a 
fine job.
    Secretary Babbitt. Thank you.

                       hot springs national park

    Senator Bumpers. And finally, let me just say, Mr. 
Chairman, that I have about three parochial questions.
    Senator Leahy. What? What? In this committee? A parochial 
question. [Laughter.]
    Senator Bumpers. Do not go blabbing that. [Laughter.]
    Hot Springs National Park is, I think, the oldest national 
park in America. They have approximately 55 buildings there. 
They have had no significant increase in operations funding in 
the past 10 years, and I am asking the chairman in his mark to 
give us some small assistance on that.

             lower mississippi delta region heritage center

    I am also asking the chairman to help us do a feasibility 
study on something that will benefit the lower Mississippi 
delta region, and at the same time use a facility, Eaker Air 
Force Base, which was closed by the last BRAC Commission, and 
that is a small $65,000 request, to do a feasibility study on a 
possible archeological heritage center, at the site.

                   fort smith national historic site

    And finally, we have begun finally to do a rehabilitation 
project at the Fort Smith National Historic Site, the site of 
old Judge Parker's court house and old Fort Smith. It is a 
magnificent place. It is really surprising to people who see 
that for the first time how historical it is and how well kept 
it is. But we have started the first phase of that, and of 
course, the second phase we hope to begin. We hope to get the 
money in 1998 to do the second phase at $3.4 million.
    I will submit questions on those three items to you in 
writing, and ask for your comments.
    Secretary Babbitt. I would be happy to respond.
    Senator Bumpers. I will copy you also with a letter, Mr. 
Chairman.
    Senator Domenici.
    Senator Domenici. I think it is Senator Burns' turn.
    Senator Burns. You go ahead. You are a busier man than I. I 
will not be done before about 3:30 or 4 p.m. [Laughter.]
    Senator Domenici. Thank you.
    First, I want to welcome the Secretary. Mr. Chairman, I 
also want to join Senator Byrd in commending you on the 
handling of the committee, permitting Senator Stevens, our 
chairman, to proceed first, as he did. I think we on this side, 
I hope on that side also, are rather thrilled to have Ted 
Stevens as our chairman. I would suggest that there may be a 
new era upon us with reference to the appropriators, and in 
particular our chairman, all of which I think will be for the 
better for the committee and the country.

                      budget resolution--user fees

    Mr. Secretary, let me answer Senator Bumpers' question, if 
you would not mind.
    Senator Bumpers, just by way of a quick comment regarding 
budget negotiations and negotiations with reference to user 
fees. Some of the items you talked about were user fees; those 
were handled completely separately from the issue of how do we 
get to the $135 billion for the gross tax cut. Some user fees 
are found in the proposal. Many of those recommended by the 
administration are not found in the proposal. Very few are 
found in the reconciliation instructions, because most of those 
not in the reclamation area that were asked for have been 
proposed for 8, 10, or 12 years and have never been 
accomplished. So we did not believe we ought to try them again.
    The issue of where the committees will find the money 
within the Tax Code to fill that additional amount beyond the 
$85 billion net tax cut is left totally up to the tax-writing 
committees of jurisdiction. The administration has a long list, 
and the committees have short lists, but no item was negotiated 
between the committees and the administration with reference to 
specific ways to fund that $50 billion shortfall other than $30 
billion of it would probably come from the extension of the 
airline ticket tax, which is an event that has already occurred 
for the rest of this fiscal year.

              indian relationship with federal government

    Now, Mr. Secretary, I want to, as quickly as I can, go 
through three or four things. In the first part, and I hope you 
will take this as constructive on my part, but I frequently 
think I represent 21 States because I have my State of New 
Mexico, and then I have within my State 18 Indian Pueblos who 
govern themselves and three large Indian reservations, a 
portion of Navajo being in my State. I respect their governance 
authority and their relationship directly to the national 
government.
    I believe the Indian relationship with the Federal 
Government is the worst I have seen in my 25 years in the 
Senate. I am not laying blame, but it is in a state of chaos, 
in my opinion. Any notion that the Bureau of Indian Affairs is 
doing a better job, is false. I tell you, I just met Saturday 
for 3 hours, Senators, with 15 of these Indian groups. There is 
a unanimous absolute--everybody agrees that the Bureau of 
Indian Affairs is in shambles.
    I am not going to go beyond these general statements other 
than to urge that you do a couple of things: Mr. Secretary, you 
and the President desperately, desperately need an Assistant 
Secretary in charge of Indian Affairs. You need to send us 
somebody quickly. If you need help from Republicans, you might 
ask for suggestions. I told the tribes it probably has to be a 
Democrat. They raised their hand and said why? We need a 
manager, they said, of high, high repute in that job.
    They are even talking about whether the Department is so 
big that BIA gets the appropriate attention, and whether the 
Secretary could even give BIA the kind of attention it 
deserves. Vacancies are all the way up and down the Bureau of 
Indian Affairs. I do not know, Mr. Chairman, if you are now 
aware that the rules of the Bureau of Indian Affairs are found 
in 43 volumes of Bureau interpretations, by number, and they 
would probably stretch from you to the end of this table if you 
put them side by side.
    Now, these people that run the Indians' business can find 
anything to satisfy anything, or to say the opposite, within 
these 43 volumes. In fact, the Indians are so confused they 
have asked us to repeal them all--just pass a bill and repeal 
them all.
    I do think we did a couple of things in the budget 
agreement, Mr. Secretary, that are helpful. I do not know 
whether our chairman likes it, but we did. If anybody is 
wondering at whose suggestion, I will tell you, at my 
suggestion we made the $757 million in tribal priority funds an 
absolute priority that the leadership says, Mr. Chairman, you 
have to fund in your allocation--out of your allocation.
    When we told that to the Indian people, they said that is 
not interesting. If we were to ask the Bureau of Indian Affairs 
what our share of it is and what we are supposed to get, they 
told me, Mr. Secretary, that nobody would be able to tell them, 
or come even close to telling them what they are going to get 
out of this $75 million increase in this fund.
    I can drop the subject at this point and say I was pleased 
to tell you this. I hope I did not tell it to you in a way that 
is intended to fall disproportionately on your shoulders. I did 
not intend it that way. The whole process has got to be fixed. 
It will not be fixed until somebody in the administration, 
perhaps your new Assistant Secretary, just decides that they 
have got to take on reform, really do something with it, and 
take a lead.

                             indian schools

    I will give you examples of some things you would be 
embarrassed about--the status, physical status of the schools 
we run, which serve only about 14 percent of the Indian kids. 
The backlog of facilities needs is enormous, and the condition 
of many of the schools are so inferior that if public school 
kids went there, they would close them down. Somebody has got 
to grab the attention of the country and the Congress and get 
something done in these areas.

                      southwest willow flycatcher

    I want to ask you if you would do me a favor on another 
issue. In the State of New Mexico under the Endangered Species 
Act we have a threatened or endangered songbird called the, 
Southwest Willow Flycatcher. What has actually happened is that 
the Fish and Wildlife Service has no specific recommendations 
about this songbird, in response to BLM's section 7 
consultation. The Bureau of Land Management is negotiating with 
one active group, Sam Hih in New Mexico, whom you know, and his 
group. They are negotiating with them, and nobody else is in 
the negotiations. This group is suggesting at least 5 miles 
around every songbird nest--I see some people nodding 
incredibly in the audience who know something about it.
    I would merely ask if it is possible that BLM would also 
bring in the other interested parties as they talk about this 
particular songbird. Would you give that some consideration, 
Mr. Secretary?
    Secretary Babbitt. Certainly.
    Senator Domenici. I would very much appreciate that.

                         u.s. geological survey

    With reference to other things in my State, I want to thank 
you and the USGS. You alluded to that when you were speaking of 
the macro things that you try to help with, and we are 
cooperating in putting up our money. USGS is adding to its 
reputation by going down into this huge basin that supplies 
water to Albuquerque to try to tell us and everybody what its 
real nature is. I thank the chairman for helping us with that. 
U.S. Geological Survey deserves my highest accolades; and they 
are very professional.

                     petroglyphs national monument

    I have a couple of things that worry me: Petroglyphs 
National Monument, and I will not talk about the road 
legislation. We will do that at another time. This park unit 
has been pending for a long time in terms of land acquisition, 
and you asked for nothing in this budget. The chairman will 
give me some money, but maybe your Department could work with 
OMB. Maybe they leave me out, because nothing in New Mexico got 
funded in the budget. I do not know, it is very interesting.
    Senator Gorton. Except by the chairman.
    Senator Domenici. Except by the chairman. Maybe it is 
because I am not your favorite Senator or you are not my 
favorite cabinet member, I do not know.
    Secretary Babbitt. Senator, you are tied for my favorite 
Senator with 99 others. [Laughter.]
    Senator Domenici. That is what I figured, and that means I 
could very well be 100. I understand that. I will not say it is 
mutual, because I do not feel that way about anybody. But such 
things as the petroglyphs, when we get not a single 
administration request when Congress has funded it 2 or 3 years 
in a row. We have to buy the rest of that land.

                       southwest fisheries center

    We also have a Southwestern Fisheries Technology Center. It 
is 85 percent completed. You asked for no money for it. Maybe, 
again, whoever is putting the budget together, because they do 
not like it, maybe they figure our good friend the chairman 
will fund it anyway. This has not been a good year for funding 
projects in New Mexico.
    Nevertheless, I thank you, and I just want you to know that 
we are getting along pretty well in spite of it. We are coming 
out of this appropriations process pretty well, even without 
the recommendations finding themselves in your budget.

                         secretarial accolades

    I am going to leave on a positive note, Mr. Secretary. You 
feel very strongly and have certain philosophies on governance. 
I do want to say to you, I believe, considering that that is 
how you feel, that you have become much better at managing 
those kinds of events. I think you have been more inclusive as 
you progress through this tenure. I thank you for that--
everything from range management to other things that you and I 
do not see eye to eye on. I think it has come to the point 
where everybody understands that there is not just one group of 
Americans that is interested in solving these problems.
    Thank you very much, Mr. Chairman.
    Senator Gorton. Senator Leahy.
    Senator Leahy. I will try to follow the example of my 
friend from New Mexico, and I will try not to use the full 5 
minutes allotted for the questions. But I found the first 20 
minutes of it very instructive, Pete, and I appreciate it. I 
learned a lot. I will know what to do with our Indian problem 
now in Vermont.
    Senator Domenici. Well, you barely made it, so do not 
complain. [Laughter.]

                     connecticut river partnership

    Senator Leahy. I understand that I missed some of the 
excitement before. We do not have those problems in Vermont. 
And I want to thank the Secretary for a lot of the attention he 
has given to States in the Northeast, and some of the areas 
important to us, especially your help in ensuring the 
Connecticut River Partnership has continued to receive support 
from the National Park Service. That has been important to a 
lot of us. Vermont has only one national park, but the rivers 
and trails program and the partnership it supports are 
essential for protecting our special areas, and it improves 
access to Vermont's trails, lakes, and rivers.
    The Connecticut River Partnership demonstrates the 
commitment that local communities have to protecting the 
Connecticut River watershed. In fact, I believe the river has 
been nominated for recognition as an American heritage river 
under the President's new initiative. I want you to know I 
wholeheartedly endorse that. The Connecticut River, as you 
know, comes down and divides between Vermont and that eastern 
State, New Hampshire. It keeps our western State of Vermont 
safe. But I think you will find that both New Hampshire and 
Vermont would support it.

                    land and water conservation fund

    You have recognized the importance of the two acid 
deposition monitoring stations in Vermont, and I appreciate 
that very much, and the funding for the National Atmospheric 
Deposition Program. The land and water conservation fund is one 
I have long supported. And I see the budget agreement 
includes--or I am told--includes increased use of the fund. In 
the Northeast, we are at a significant disadvantage tapping 
into it, because we have so little public land. But when it was 
operational, the State side of the fund was critical in 
helping. And so I would urge the administration to restart the 
State side of the land and water conservation fund as part of 
an effort to bolster the fund, because it helps us protect our 
streams and our parks and our lakes and so on.

                      supplemental appropriations

    Now, we are going to pass a supplemental appropriations 
bill. I am sure there is going to be allocations for Fish and 
Wildlife Service facilities that were lost or damaged during 
the floods, and the Department is going to now start moving 
those out of flood plains. That is a policy that should be 
implemented nationwide, not just where the most recent floods 
were.

                  missisquoi national wildlife refuge

    We have only one national wildlife refuge headquarters 
sited in our State of Vermont, but it is located in the flood 
plain of the Missisquoi River--that is M-i-s-s-i-s-q-u-o-i. I 
know the reporter, the official recorder of these things, would 
like that.
    The facility floods regularly, has no insulation and 
provides minimal office space.
    In fact they have started, the two-person staff, have 
started holding environmental education programs in a boat 
shed, because the regular facility is in such poor shape. Now, 
last year, you included one-quarter of a million dollars for 
the highest priority operations and maintenance needs to 
address what is a $3.3 million backlog. So we have a $3.3 
million backlog; $250,000 was included to help out on it. By 
the time it got done, only $50,000 showed up. Can we get some 
kind of similar funding in the fiscal year 1998 budget for the 
Missisquoi?
    [The information follows:]

                  Missisquoi National Wildlife Refuge

    The proposed fiscal year 1998 operations and maintenance 
budget for Missisquoi National Wildlife Refuge is $258,000, an 
increase of $6,000 over fiscal year 1997. Of this total, 
approximately $50,000 will be spent directly on maintenance 
staff salaries or supplies and materials to perform routine 
maintenance. Missisquoi NWR, like many other refuges throughout 
the Nation, has had a shortfall in operations and maintenance 
funding which is gradually creating a substantial backlog in 
both areas. The Service plans to continue to address the need 
for maintenance and improved operational capability at all 
refuges throughout the Nation by prioritizing the needs of all 
refuges, selecting those with the greatest need for the earlier 
funding.

                                 floods

    Secretary Babbitt. Senator, I will certainly have a look at 
it and respond to you. I am not familiar with that particular 
line item in the request. But I would be happy to look at it.
    Senator Leahy. I do not expect you to know all those line 
items, Mr. Secretary. I do not know how you keep up with all 
the things you do. But I had a feeling that if it was mentioned 
at this hearing, that it might somewhere pop out. I know in the 
Senate, Senators are merely constitutional impediments to their 
staffs, and so often we will mention something that the staff 
will actually look at. So I would hope that yours might on 
this.

                            invasive species

    We also have the problem of invasive species into our 
waters. The U.S. Geological Survey has set aside $750,000 to 
address this. In our Lake Champlain, that magnificent lake that 
goes from Canada, straight down through, and separates Vermont 
from New York--you know, Vermont likes these waterways that 
kind of define who we are--we have had the problems of zebra 
mussels, which is now becoming a serious problem, because it is 
growing there, not just in the Great Lakes. We also face the 
spread of sea lamprey and water mill foil. We reauthorized the 
National Invasive Species Act to address these problems.
    Do you know offhand the amount allocated in the USGS budget 
that would go to fighting aquatic invasive species?
    Secretary Babbitt. Senator, it is a very modest amount. I 
think it is one-half million dollars or something like that. 
And that is not to deny the seriousness of the problem. I mean 
you have got purple loosestrife running wild across New 
England. The zebra mussel you have mentioned, and a whole 
variety of others. But that is the reality.
    Senator Leahy. I would mention, on Lake Champlain, if you 
could look carefully at this, outside of the Great Lakes, it is 
the largest body of fresh water in the United States. That is a 
very, very significant lake. It has one of the most remarkable 
biological systems in the lake, with all the different things, 
but we are being hurt by these particular areas. And if you 
could have your folks look at it. And I would be glad to meet 
with anybody from your office that might be doing that.
    And my other questions, Mr. Chairman, I will submit for the 
record.
    Senator Gorton. Thank you, Senator Leahy.
    Senator Leahy. Thank you very much. But if we could follow 
up on that and the Lake Champlain.
    Secretary Babbitt. Senator, I will. Thank you.
    Senator Leahy. And I am delighted you are here.
    Secretary Babbitt. Thank you.
    Senator Gorton. Senator Burns.
    Senator Burns. Is that zebra mussel an endangered specie? 
[Laughter.]
    [The information follows:]

                    Lake Champlain Invasive Species

    The Fish and Wildlife Service is involved in efforts to 
preserve Lake Champlain, as well as other lakes in the 
northeastern United States, from nonnative aquatic nuisance 
species such as the zebra mussels. The zebra mussel explosion 
has reached a critical stage that is becoming an economic and 
ecological catastrophe. Zebra mussels can have a devastating 
impact on all aquatic life, birds and mammals by changing water 
quality, disrupting the food chain and predator-prey 
relationships, and altering physical habitat.
    Zebra mussels are found throughout Lake Champlain at 
densities of 60,000 to 109,000 mussels per cubic meter, with 
some concentrations as high as 134,000 mussels per cubic meter 
which is nearly as high as populations in the Great Lakes. This 
invasive species poses a serious risk to the water resources of 
Vermont and New York. It has caused a serious economic burden 
not only to the industrial and potable water systems along the 
lake, but also to the entire ecosystem of Lake Champlain.
    The Service, other Federal agencies, Vermont and New York's 
environmental agencies, and many private organizations have 
joined in the battle to control zebra mussels in Lake 
Champlain, and have identified the control of zebra mussel as 
one of their highest priority actions. Current management 
actions have focused on controlling the mussel's attachment to 
surfaces and water intake pipes and preventing further spread. 
The Service's Lake Champlain Fish and Wildlife Resource Office 
is working with the public and private sector to develop and 
implement a Comprehensive Management Program for Nuisance 
Nonnative Aquatic species in the Lake Champlain Basin. The 
Management Program will evaluate and demonstrate zebra mussel 
control strategies in order to halt the mussel's uncontrolled 
spread and impact on the region's economy and fisheries.

               national park service maintenance backlog

    Senator Burns. Mr. Secretary, thank you for coming this 
morning. And I have a couple of questions that I think will 
require--you will have to respond to in writing. It has to do 
with the repair work and the infrastructure of our National 
Park System. I would like some kind of report of the backlog 
that you have now, as far as infrastructure.
    I was in Glacier National Park on Saturday. We dedicated, 
or recognized, the partnership that has been formed between the 
local group and Flathead County in the restoration of the 
chalets in Glacier National Park. It was a very nice affair. We 
see that when local partnerships are formed, we can do some 
very positive things about the accommodations of people.
    You know we tend to look at parks, and we forgot that we 
are in the people business. That is just as important as some 
other things that we do.
    If you could supply me with that backlog. I would like to 
help you with that. Because we have some very serious problems 
in transportation and roads in Yellowstone Park, and we will 
try to help you with that situation.
    [The information follows:]

                                                      RECAPITALIZATION OF THE NATIONAL PARK SYSTEM                                                      
                                    [Preliminary list of unfunded capital construction needs, alphabetically by park]                                   
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                           Gross                                                        
                     Park                                  Project title               construction     Package        Reg.      Objective    Work type 
                                                                                         estimate        number                                         
--------------------------------------------------------------------------------------------------------------------------------------------------------
Acadia National Park.........................  Upgrade restrooms, water, sewer,            5,750,000          232          NAR            1            U
                                                power.                                                                                                  
Acadia NP....................................  Rehabilitate historic structures.....       8,500,000          320          NAR            2            B
Acadia NP....................................  Rehabilitate tour loop roads and           24,000,000          287          NAR            2            R
                                                bridges.                                                                                                
Acadia NP....................................  Replace visitor center and construct       16,560,000          233          NAR            4            B
                                                park entrance.                                                                                          
Acadia NP....................................  Improve McFarland Hill Headquarters..       9,960,000          234          NAR            3            B
Acadia NP....................................  Alternative transportation modes.....       1,320,000         2006          NAR            5            R
Adams National Historic Site.................  Rehabilitate Beale Estate............       2,020,000          108          NAR            2            B
Agate Fossil Beds National Monument..........  Construct employee housing and              1,950,000          198          MWR            5            H
                                                recreation facilities.                                                                                  
Alaska parks (multiple)......................  Rehabilitate historic/building New          3,960,000          135          AKR            2            B
                                                Backcountry cabins.                                                                                     
AlibateS Flint Quarry NM.....................  Construct visitor contact station....       4,320,000          105          SWR            4            B
Allegheny Portage National Historic Site.....  Staple Bend Tunnel stabilization/           3,000,000          225          MAR            3            R
                                                development.                                                                                            
Allegheny Portage National Historic Site.....  ALPO/JOFL Development Program........      11,760,000          226          MAR            5            L
Amistad National Recreation Area.............  Construct visitor contact stations          3,000,000          117          SWR            5            B
                                                and boat launch.                                                                                        
Amistad NRA..................................  Reconstruct roads....................       2,640,000          180          SWR            3            R
Antietam National Battlefield................  Stabilize/restore historic battle           2,400,000          315          NCR            2            B
                                                structures.                                                                                             
Antietam NB..................................  Construct new roads for scene               2,886,000          271          NCR            2            R
                                                restoration.                                                                                            
Apostle Islands National Lakeshore...........  Protect lightstation from shoreline         4,642,400          839          MWR            2            L
                                                erosion.                                                                                                
Apostle Islands NL...........................  Renovate employee quarters in               1,440,000          248          MWR            3            H
                                                historic lightstations.                                                                                 
Arkansas Post NM.............................  Construct maintenance/storage               1,200,000          116          SWR            5            B
                                                facility.                                                                                               
Assateague Island National Seashore..........  Rehabilitate historic structures/           9,000,000          263          MAR            2            L
                                                stabilize national resources.                                                                           
Assateague NS................................  Reconstruct roads and parking, MD and       6,600,000          231          MAR            3            R
                                                VA.                                                                                                     
Assateague NS................................  Redevelop parking--chnctg............       3,432,000          233          MAR            3            R
Aztec Ruins NM...............................  Construct administrative ctr./              4,680,000          133          SWR            5            B
                                                operations complex.                                                                                     
Badlands NP..................................  Rehabilitate 30 miles of main road...      24,156,000          120          RMR            3            R
Baltimore-Washington Memorial Parkway........  System completion project............      31,680,000         1006          NCR            5            R
Bandelier NM.................................  Relocate facilities from Frijoles          15,700,000          214          SWR            2            B
                                                Canyon.                                                                                                 
Bandelier NM.................................  Rehabilitate Ponderosa Campground....       1,320,000          109          SWR            3            L
Bandelier NM.................................  Rehabilitate trails..................       3,600,000          210          SWR            2            L
Bandelier NM.................................  Construct water storage and                   840,000          246          SWR            3            U
                                                distribution.                                                                                           
Bering Land Bridge National Preserve.........  Construct multiagency visitor center.       5,564,000        100NO          AKR            4            B
Big Bend NP..................................  Rehabilitate Chisos Basin Campground.       3,200,000          274          SWR            3            L
Big Bend NP..................................  Reconstruct major park roads.........      19,008,000          223          SWR            3            R
Big Bend NP..................................  Construct addition to park visitor         10,680,000          114          SWR            5            B
                                                center.                                                                                                 
Big Bend NP..................................  Modernize/expand Panther Junction           3,200,000          132          SWR            1            U
                                                water system.                                                                                           
Big Bend NP..................................  Relocate overhead utility lines......       4,200,000          169          SWR            3            U
Big Bend NP..................................  Improve/expand Panther Junction             2,400,000          160          SWR            3            B
                                                maintenance area.                                                                                       
Big Bend NP..................................  Rehabilitate/expand campgrounds (RGV-       2,400,000          166          SWR            3            L
                                                CA).                                                                                                    
Big Bend NP..................................  Construct resource management               2,400,000          276          SWR            5            B
                                                facility.                                                                                               
Big Bend NP..................................  Rehabilitate and expand sewage              3,200,000          278          SWR            1            U
                                                treatment.                                                                                              
Big Cypress Nat Preserve.....................  Scenic corridor visitor safety hwy.         4,800,000            1          SER            1            R
                                                improvements.                                                                                           
Big Cypress NPRes............................  ADditional lands operation facility..       1,720,000            2          SER            4            B
Big Thicket NPRes............................  Construct park visitor center/              8,280,000          107          SWR            4            B
                                                headquarters.                                                                                           
Big Thicket NPRes............................  Construct trails, trailheads, water        13,200,000          111          SWR            2            L
                                                access.                                                                                                 
Big Thicket NPRes............................  Stabilize roads......................       2,112,000          113          SWR            3            R
Bighorn Canyon NRA...........................  Provide safe recreation area at OK-A-         254,400          222          RMR            3            L
                                                BEH.                                                                                                    
Blackstone River Valley NHCC.................  Rehabilitate Slater's Mill Historic         5,400,000          105          NAR            2            B
                                                Structures and Site.                                                                                    
Blue Ridge Parkway...........................  Fisher Peak Mountain Music Center....       4,000,000          507          SER            5            B
Blue Ridge Parkway...........................  Tunnels-lined........................       6,204,000          132          SER            3            R
Blue Ridge Parkway...........................  Grade separations....................       3,564,000          521          SER            3            R
Blue Ridge Parkway...........................  Resurface 25 miles of parkway........      87,912,000          503          SER            3            R
Booker T. Washington NM......................  Construct maintenance. shop and             1,822,800          161          MAR            5            B
                                                expand visitor center.                                                                                  
Boston Afro-American NHS.....................  Complete rehabilitation of Smith            1,175,000          102          NAR            2            B
                                                School.                                                                                                 
Boston Nat Historic Park.....................  Charlestown Navy Yard road safety           3,630,000          154          NAR            1            R
                                                improvements.                                                                                           
Boston NHP...................................  Rehabilitate Bunker Hill structure            859,200          106          NAR            2            L
                                                and site.                                                                                               
Boston NHP...................................  Preserve/rehabilitate historic              4,800,000          130          NAR            2            B
                                                commandant's house.                                                                                     
Bryce Canyon NP..............................  Reconstruct roads parkwide...........      25,080,000          106          RMR            3            R
Bryce Canyon NP..............................  Rehabilitate 206 camping sites in           1,700,000          103          RMR            3            L
                                                park.                                                                                                   
Bryce Canyon NP..............................  Rehabilitate visitor and education          4,400,000          125          RMR            3            B
                                                center.                                                                                                 
Buffalo National River.......................  Construct Tyler Bend employee housing       2,760,000          109          SWR            4            H
Buffalo NR...................................  Improve river camp sites, launches,        12,360,000          185          SWR            4            L
                                                and roads.                                                                                              
Buffalo NR...................................  Construct park headquarters and             5,520,000          240          SWR            4            B
                                                visitor center.                                                                                         
Buffalo NR...................................  Develop Pruitt public use/operations        1,800,000          113          SWR            4            B
                                                facilities.                                                                                             
C&O Canal NHP................................  Restore historic Monocacy aqueduct...       8,000,000          100          NCR            2            L
C&O Canal NHP................................  Reconstruct historic wide-water               630,000           01          NCR            1            L
                                                towpath.                                                                                                
C&O Canal NHP................................  Rehabilitate deteriorating historic           660,000          101          NCR            2            B
                                                complex.                                                                                                
C&O Canal NHP................................  Restore deteriorated historic               1,800,000           29          NCR            2            B
                                                tidelock.                                                                                               
C&O CANAL NHP................................  GREAT FALLS ENTRANCE STATION ROAD....         660,000           77          NCR            3            R
CANAVERAL NS.................................  CONSTRUCT HQ, VC, STORAGE, and              4,207,200          105          SER            5            B
                                                EXHIBIT COMPLEX.                                                                                        
CANYON DE CHELLY NM..........................  REHABILITATE CANYON ROADS............       1,200,000          172          SWR            3            R
CANYON DE CHELLY NM..........................  REHABILITATE PARK ROADS..............       1,980,000          169          SWR            3            R
CANYONLANDS NP...............................  REPAIR 225.4 MILES ROAD..............      16,368,000          183          RMR            3            R
CAPE COD NS..................................  REHABILITATE EIGHT BEACH FACILITIES..       9,100,000          226          NAR            1            B
CAPE COD NS..................................  REHABILITATE DORMITORY AND SEASONAL        11,850,000          225          NAR            1            H
                                                HOUSING UNITS.                                                                                          
CAPE COD NS..................................  REHABILITATE SALT POND AND                  4,896,000          228          NAR            2            B
                                                PROVINCELAND VISITOR CENTER.                                                                            
CAPE COD NS..................................  REHABILITATE PARK ROADS AND PARKING..       2,640,000          210          NAR            3            R
CAPE HATTERAS NS.............................  REPAIR/REPLACE EMPLOYEE HOUSING......       8,400,000          801          SER            3            H
CAPE HATTERAS NS.............................  CONSTRUCT PROTECTIVE GROIN...........       2,000,000          301          SER            2            L
CAPE HATTERAS NS.............................  RELOCATE LIGHTHOUSE..................      10,530,000          175          SER            2            L
CAPULIN VOLCANO NM...........................  EXPAND/IMPROVE MAINTENANCE AREA......       1,800,000          154          SWR            5            B
CARLSBAD CAVERNS NP..........................  REHABILITATE/REPLACE ELEVATOR SHAFT         2,000,000          198          SWR            1            B
                                                STEEL.                                                                                                  
CARLSBAD CAVERNS NP..........................  PROVIDE CAVE HANDRAIL................       1,200,000          199          SWR            1            L
CARLSBAD CAVERNS NP..........................  REPLACE WATER TRANSMISSION and              3,600,000          191          SWR            3            U
                                                STORAGE.                                                                                                
CARLSBAD CAVERNS NP..........................  RESURFACE ENTRANCE ROAD AND PARKING..         660,000          180          SWR            3            R
CASTLE CLINTON NM............................  REHABILITATE CASTLE CLINTON NATIONAL       26,040,000          105          NAR            5            B
                                                HISTORIC SITE.                                                                                          
CATOCTIN MOUNTAINS PARK......................  REPLACE FAILING ELECTRICAL SYSTEM....         721,810          989          NCR            3            U
CEDAR BREAKS NM..............................  RECONSTRUCT PARK ROADS...............       3,036,000          114          RMR            3            R
CHACO CULTURE NHP............................  CONSTRUCT HOUSING, CAMPGROUND, WATER/      11,040,000          204          SWR            5            B
                                                SEWER SYS.                                                                                              
CHACO CULTURE NHP............................  CONSTRUCT ADDITION TO MAINTENANCE             840,000          207          SWR            5            B
                                                SHOP.                                                                                                   
CHANNEL ISLANDS NP...........................  CONSTRUCT 8 EMPLOYEE HOUSES AT SANTA        3,458,400          671          WER            4            H
                                                ROSA.                                                                                                   
CHATTAHOOCHEE NRA............................  CONSTRUCT DAY USE FACILITIES, TRAILS,       3,885,600          101          SER            5            B
                                                COMFORT STATION.                                                                                        
CHICKAMAUGA and CHATTANOOGA..................  RELOCATE US HWY 27 WITHIN PARK (GA)..      30,360,000          142          SER            3            R
CHICKAMAUGA and CHATTANOOGA..................  IMPROVE PARK ROADS, SHOULDERS, and          6,732,000          102          SER            3            R
                                                DRIVEOUTS.                                                                                              
CHICKAMUAGA and CHATTANOOGA..................  REPLACE TWO BRIDGES-ALEXANDER BRIDGE        2,196,000          165          SER            1            R
                                                ROAD.                                                                                                   
CHICKASAW NRA................................  IMPROVE CAMPGROUNDS..................      11,540,000          215          SWR            3            L
CHICKASAW NRA................................  CONSTRUCT VISITOR CTR./HEADQTRS./           4,560,000          208          SWR            5            B
                                                MTNCE. COMPLEX.                                                                                         
CHICKASAW NRA................................  DEVELOP VETERANS LAKE VISITOR               2,400,000          209          SWR            5            R
                                                FACILITIES.                                                                                             
CHICKASAW NRA................................  REHABILITATE VETERANS DAM (REPAY BUR.         600,000          206          SWR            3            L
                                                OF RECLAMATION).                                                                                        
CHIRICAHUA NM................................  UPGRADE UTILITIES, HEADQUARTERS, and        1,200,000          241          SWR            3            B
                                                CAMPGROUND.                                                                                             
CHIRICAHUA NM................................  REHABILITATE MAIN PARK ROAD..........       9,372,000          103          WER            3            R
CITY OF ROCKS NM.............................  CONSTRUCT RV CAMPGROUND, ROADS,            23,160,000          101          PNR            2            B
                                                TRAILS, RESTROOMS.                                                                                      
COLONIAL NHP.................................  CONNECT JAMESTOWN WATER SYSTEM TO             959,000          400          MAR            1            U
                                                MUNICIPAL SYSTEM.                                                                                       
COLONIAL NHP.................................  PROTECT JAMESTOWN ISLAND FROM EROSION      18,000,000          248          MAR            2            L
COLONIAL NHP.................................  CONSTRUCT JAMESTOWN VIS. CTR. and          14,040,000          154          MAR            5            L
                                                COLLECTION STORAGE.                                                                                     
COLONIAL NHP.................................  BUILD COLONIAL PARKWAY BICYCLE and         24,000,000          249          MAR            5            L
                                                WALKING TRAIL.                                                                                          
COLONIAL NHP.................................  REALIGN PARK PORTION OF HIGHWAY 238..       3,699,600          127          MAR            5            R
COLONIAL NHP.................................  YORKTOWN ROADS AND BRIDGES...........       4,752,000          317          MAR            3            R
COLONIAL NHP.................................  REHABILITATE JAMESTOWN ROADS.........       1,320,000          321          MAR            3            R
COLONIAL NHP.................................  REPAIR/REHABILITATE COLONIAL PARKWAY.      13,200,000          251          MAR            3            R
COLORADO NM..................................  REHABILITATE 23 MILES OF RIMROCK            7,920,000          110          RMR            3            R
                                                DRIVE.                                                                                                  
CONGAREE SWAMP NM............................  CONSTRUCT PERMANENT FACILITIES.......       9,000,000          101          SER            4            B
COULEE DAM NRA...............................  EXPAND KELLER FERRY CAMPGROUND              2,400,000          203          PNR            5            B
                                                FACILITIES.                                                                                             
COULEE DAM NRA...............................  RESURFACE ROADS AND PARKING--PARKWIDE       2,040,000          266          PNR            1            R
COULEE DAM NRA...............................  RESURFACE ROADS AND PARKING..........       1,716,000          266          PNR            1            R
CRATER LAKE NP...............................  CONTRUCT ACTIVITY CENTER, PARKING,         60,000,000          274          PNR            2            B
                                                AND ROADS.                                                                                              
CRATER LAKE NP...............................  CONSTRUCT EMPLOYEE HOUSING AND              5,800,000          275          PNR            5            H
                                                SUPPORT FACILITIES.                                                                                     
CRATER LAKE NP...............................  CORRECT CLEETWOOD COVE PARKING              1,000,000          276          PNR            1            R
                                                FACILITIES.                                                                                             
CRATER LAKE NP...............................  RESURFACE ANNIE SPRINGS TO WEST             5,544,000          235          PNR            1            R
                                                BOUNDARY ROAD.                                                                                          
CRATER LAKE NP...............................  RESURFACE 6.1 MILES OF ROUTE 7--            1,452,000          253          PNR            1            R
                                                PINNACLES ROAD.                                                                                         
CRATER LAKE NP...............................  RESURFACE CLOUDCAP TO HEADQUARTERS          3,960,000          256          PNR            1            R
                                                ROAD.                                                                                                   
CRATERS OF THE MOON NM.......................  CONSTRUCT VISITOR CENTER, ROADS, AND        5,400,000          153          PNR            5            B
                                                UTILITIES.                                                                                              
CUMBERLAND GAP NHP...........................  SYSTEM COMPLETION PROJECT............      47,520,000         1007          SER            5            R
CUMBERLAND ISLAND NS.........................  CONSTRUCT VISITOR CENTER, EXHIBITS,         3,494,400          112          SER            5            B
                                                UTILITIES, MTNCE. FACILITIES.                                                                           
CURECANTI NRA................................  REPLACE WATER TREATMENT PLANT AND ADD       1,729,200          272          RMR            3            U
                                                RESERVOIR.                                                                                              
CUYAHOGA NRA.................................  RECONSTRUCT RIVER VIEW RD............       1,320,000          203          MWR            3            R
CUYAHOGA NRA.................................  RECONSTRUCT WHEATLEY ROAD............       1,848,000          206          MWR            3            R
CUYAHOGA VALLEY NRA..........................  CONTINUE CLEANUP OF KREJCI DUMP SITE.       5,400,000          260          MWR            1            L
DAYTON AVIATION HERITAGE NHS.................  REHABILITATE HISTORIC HOOVER BLOCK...       4,941,600          100          MWR            2            B
DEATH VALLEY NP..............................  CONSTRUCT EMPLOYEE HOUSING AT DEATH        19,807,200          388          WER            1            H
                                                VALLEY.                                                                                                 
DEATH VALLEY NP..............................  REPLACE COW CREEK MAINTENANCE               5,187,600          500          WER            1            B
                                                FACILITY.                                                                                               
DEATH VALLEY NP..............................  REHABILITATE BADWATER ROAD and SPUR        14,916,000          283          WER            3            R
                                                ROADS.                                                                                                  
DEATH VALLEY NP..............................  RECONSTRUCT ROUTES 8 and 35..........      19,932,000          105          WER            3            R
DEATH VALLEY NP..............................  SURFACE 7 MILES OF N ENTRANCE ROAD--        1,848,000          257          WER            5            R
                                                ROUTE 8.                                                                                                
DEATH VALLEY NP..............................  REHABILITATE MUD CANYON and DAYLIGHT       12,144,000          348          WER            3            R
                                                PASS ROADS.                                                                                             
DEATH VALLEY NP..............................  RECONSTRUCT/REALIGN GRAPEVINE CANYON       10,032,000          352          WER            3            R
                                                ROAD.                                                                                                   
DELAWARE WATER GAP NRA.......................  REPAIR/REPLACE NEW JERSEY VISITOR USE      24,120,000          264          MAR            3            B
                                                FACILITIES.                                                                                             
DELAWARE WATER GAP NRA.......................  STABILIZE HISTORIC STRUCTURES AT 40        22,320,000          111          MAR            2            B
                                                SITES.                                                                                                  
DELAWARE WATER GAP NRA.......................  REPAIR/REPLACE PENNSYLVANIA VISITOR        22,476,000          263          MAR            3            L
                                                USE FACILITIES.                                                                                         
DELAWARE WATER GAP NRA.......................  REHABILITATE WEYGADT FACILITIES and        19,200,000          319          MAR            4            B
                                                BUILD VISITOR CTR.                                                                                      
DELAWARE WATER GAP NRA.......................  REHABILITATE/REPAIR ROUTE 209 (22MI)       52,800,000          292          MAR            3            R
                                                and 6 BRIDGES.                                                                                          
DENALI NP....................................  CONSTRUCT FIRE-EMERGENCY SERVICES and       1,620,000          105          AKR            5            B
                                                HEADQTRS. BLDG.                                                                                         
DENALI NP....................................  REHABILITATE ENTRANCE AREA UTILITIES--      3,410,000          120          AKR            3            U
                                                WATER and SEWER.                                                                                        
DENALI NP....................................  RESTORE 77.6 MILES OF GRAVEL ROAD          13,200,000          258          AKR            1            R
                                                SURFACE.                                                                                                
DENALI NP....................................  CONSTRUCT TOKLAT REST STOP FACILITIES       1,120,000        100TO          AKR            4            B
DENALI NP....................................  REPAIR 77.6 MI GRAVEL RD.............      13,200,000          258          AKR            3            R
DENALI NP....................................  ALTERNATIVE TRANSPORTATION MODES.....       1,320,000         2007          AKR            5            R
DINOSAUR NM..................................  RECONSTRUCT/REHABILITATE 3 FAILING         12,000,000          216          RMR            3            B
                                                STRUCTURES.                                                                                             
DINOSAUR NM..................................  CONSTRUCT MUSEUM COLLECTION/RESEARCH        4,700,000          204          RMR            5            B
                                                BUILDING.                                                                                               
DINOSAUR NM..................................  RECONSTRUCT ROADS PARKWIDE...........       9,636,000          191          RMR            3            R
DRY TORTUGAS NM..............................  REHABILITATE PORTIONS OF FORT              14,400,000          103          SER            2            L
                                                JEFFERSON.                                                                                              
EDISON NHS...................................  DEVELOP EDISON CENTER and                  29,600,000          170          NAR            1            B
                                                REHABILITATE LAB. COMPLEX.                                                                              
EISENHOWER NHS...............................  STABILIZE/REPAIR FARM STRUCTURES.....       8,620,000          130          MAR            2            B
EL MALPAIS NM................................  DEVELOP MULTIAGENCY VISITOR CENTER          5,520,000          105          SWR            4            B
                                                (PHASE 2.                                                                                               
EVERGLADES NP................................  REPLACE 20 PLUS OBSOLETE WATER and         14,600,000          191          SER            1            U
                                                SEWER SYSTEMS.                                                                                          
EVERGLADES NP................................  MODIFY WATER DELIVERY SYSTEM.........      80,000,000          193          SER            2            L
EVERGLADES NP................................  REPAVE MAIN PARK ROAD................       7,128,000          111          SER            3            R
FEDERAL HALL NAT MEMORIAL....................  REHABILITATE FEDERAL HALL............      10,104,000          105          NAR            1            B
FIRE ISLAND NS...............................  CONSTRUCT SUSTAINABLE STUDENT               2,800,000            1          NAR            3            B
                                                DISCOVERY CAMP.                                                                                         
FIRE ISLAND NS...............................  CONSTRUCT VISITOR CENTER, MTNCE., and       6,000,000          169          NAR            4            B
                                                ADMIN. FACILITY.                                                                                        
FIRE ISLAND NS...............................  PRESERVE/REHABILITATE HISTORIC FLOYD        3,600,000          174          NAR            5            B
                                                ESTATE.                                                                                                 
FLORISSANT FOSSIL BEDS NM....................  CONSTRUCT INITIAL PARK FACILITIES....       9,500,000          103          RMR            4            B
FORT DONELSON NB.............................  CONSTRUCT BYPASS ROAD................       1,980,000          127          SER            5            R
FORT LARNED NHS..............................  CONSTRUCT VISITOR CENTER.............       7,291,200          198          MWR            5            B
FORT MCHENRY NM and HIST SHRINE..............  COMPLETE HISTORIC SEAWALL REPAIRS....       2,210,000            1          MAR            2            L
FORT MCHENRY NM and HIST SHRINE..............  REPLACE UNSAFE VISITOR CENTER........       8,520,000          277          MAR            5            B
FORT NECESSITY NB............................  REHAB/DEVELOPMENT OF FORT NECESSITY..      12,024,000          230          MAR            4            L
FORT POINT NHS...............................  REPAIR EARTHQUAKE DAMAGE and REPOINT        2,140,000          393          WER            2            B
                                                BRICKWORK.                                                                                              
FORT SCOTT NHS...............................  PROVIDE FIRE PROT. SYSTEMS FOR              1,244,400          227          MWR            2            B
                                                HISTORIC STRUCTURES.                                                                                    
FORT SUMTER NM...............................  CONSTRUCT TOUR BOAT FACILITY --             7,100,000          105          SER            5            B
                                                DOCKSIDE II.                                                                                            
FORT UNION NM................................  CONSTRUCT CURATORIAL, AUDIO-VISUAL,           720,000          102          SWR            5            B
                                                and OFFICE AREAS.                                                                                       
FREDERICKSBURG N MILITARY PARK...............  PROTECT PARK BOUNDARY................         800,000          106          MAR            2            L
FREDERICKSBURG NMP...........................  STABILIZE HISTORIC STRUCTURES, RUINS,       3,855,600          107          MAR            2            L
                                                and EARTHWORKS.                                                                                         
FREDERICKSBURG NMP...........................  ENLARGE VISITOR CENTER/RESTORE HIST.       14,400,000          271          MAR            3            L
                                                ROAD TRACES.                                                                                            
FREDERICKSBURG NMP...........................  REHABILITATE PARK ROADS..............       7,128,000          230          MAR            3            R
GATEWAY NRA..................................  REHABILITATE FLOYD BENNETT FIELD, FT.      12,300,000          169          NAR            1            U
                                                TILDEN UTILITIES.                                                                                       
GATEWAY NRA..................................  COMPLETE REHABILITATION OF JACOB RIIS      12,100,000          147          NAR            1            B
                                                PARK.                                                                                                   
GATEWAY NRA..................................  COMPLETE GREAT KILLS PARK                   2,800,000          149          NAR            4            B
                                                REHABILITATION.                                                                                         
GATEWAY NRA..................................  REHABILITATE BATTERY WEED SEAWALL and       3,280,000          219          NAR            2            L
                                                DOCK.                                                                                                   
GATEWAY NRA..................................  PRESERVE/REHABILITATE FORT HANCOCK        120,000,000          123          NAR            2            B
                                                STRUCT. and UTIL.                                                                                       
GATEWAY NRA..................................  REHABILITATE FORT WADSWORTH FOR            48,000,000          191          NAR            1            B
                                                VISITOR and NPS USE.                                                                                    
GATEWAY NRA..................................  REHABILITATE SANDY HOOK MAIN ROAD....       8,580,000          111          NAR            1            R
GATEWAY NRA..................................  REHABILITATE MILLER FIELD ROAD AND          4,224,000          115          NAR            3            R
                                                PARKING.                                                                                                
GATEWAY NRA..................................  REHABILITATE PARK ROADS..............      21,780,000          185          NAR            1            R
GEO. WASHINGTON MEML PKWY....................  REHABILITATE GLEN ECHO FACILITIES....       2,000,000          171          NCR            3            B
GEO. WASHINGTON MEML PKWY....................  RESTORE THEODORE ROOSEVELT MEMORIAL..       1,765,000          181          NCR            2            L
GEO. WASHINGTON MEML PKWY....................  CandO VIEWSHED-REMOVE/REHABILITATE         19,752,000          172          NCR            2            L
                                                STRUCT. and LNDSCP.                                                                                     
GEO. WASHINGTON MEML PKWY....................  RECONSTRUCT SPOUT RUN PARKWAY (PHASE        7,440,000          836          NCR            1            R
                                                IV).                                                                                                    
GEO. WASHINGTON MEML PKWY....................  PRESERVE ARLINGTON HOUSE HISTORIC             420,000          103          NCR            2            B
                                                FURNISHINGS.                                                                                            
GEO. WASHINGTON MEML PKWY....................  SPROUT RUN TO 123....................       6,600,000          461          NCR            1            R
GEO. WASHINGTON MEML PKWY....................  123 TO SPROUT RUN....................       6,600,000          461          NCR            1            R
GEORGE WASHINGTON MEML PKWY..................  REHABILITATE MEMORIAL AVENUE BRIDGE..       3,300,000          464          NCR            3            R
GEORGE ROGERS CLARK NHP......................  REHABILITATE HISTORIC MEMORIAL              1,560,000          122          MWR            2            B
                                                TERRACE.                                                                                                
GETTYSBURG NMP...............................  PROTECT HISTORIC STRUCTURES..........       2,500,000            1          MAR            2            B
GETTYSBURG NMP...............................  REPAIR 22 HISTORIC MONUMENTS.........       2,012,000            2          MAR            2            L
GETTYSBURG NMP...............................  REHABILITATE VISITOR CENTER..........       4,280,000          296          MAR            1            B
GETTYSBURG NMP...............................  REHAB PARK ROADS.....................       8,316,000          106          MAR            3            R
GLACIER BAY NP...............................  CONSTRUCT MTNCE. FACILITIES/                1,700,000        100BC          AKR            1            U
                                                REHABILITATE UTILITY SYS.                                                                               
GLACIER BAY NP...............................  CONSTRUCT PARK EMPLOYEE HOUSING......       3,100,000          130          AKR            4            H
GLACIER BAY NP...............................  REHABILITATE MAIN PARK ROAD..........       6,204,000          170          AKR            3            R
GLACIER NP...................................  UPGRADE UNSAFE WATER AND SEWER SYSTEM       9,500,000          165          RMR            1            U
GLACIER NP...................................  REHAB GOING TO THE SUN ROAD, 55 MILES      78,144,000          303          RMR            3            R
GLACIER NP...................................  REHABILITATE SUBSTANDARD BACKCOUNTRY        2,800,000          357          RMR            3            B
                                                CHALETS.                                                                                                
GLACIER NP...................................  REHABILITATE LAKE MCDONALD/APGAR           18,673,200          264          RMR            3            B
                                                CONCESS. FACILITIES.                                                                                    
GLACIER NP...................................  REPLACE OBSOLETE HOUSING PARKWIDE....      18,765,600          399          RMR            3            H
GLEN CANYON NRA..............................  CONSTRUCT FEE COLLECTION STATIONS and      10,616,400          210          RMR            4            B
                                                EMPL. HOUSING.                                                                                          
GLEN CANYON NRA..............................  UPGRADE SUBSTANDARD PARK HOUSING.....      18,726,000          421          RMR            3            H
GLEN CANYON NRA..............................  CORRECT MARINA CONSTRUCTION                 1,176,000          434          RMR            3            U
                                                DEFICIENCIES.                                                                                           
GLEN CANYON NRA..............................  REHABILITATE STATE LINE ROADS........       3,168,000          341          RMR            3            R
GLEN CANYON NRA..............................  REHABILITATE BULL FROG ROADS.........       5,544,000          342          RMR            3            R
GLEN CANYON NRA..............................  RECONSTRUCT MARINA ACCESS ROAD.......       1,980,000          380          RMR            3            R
GOLDEN GATE NRA..............................  REHABILITATE/REPAIR FORT MASON PIER..      25,152,000          282          WER            2            B
GOLDEN GATE NRA..............................  REPLACE RESTROOMS....................       3,301,200          357          WER            5            B
GOLDEN GATE NRA..............................  STABILIZE ALCATRAZ HISTORIC                 5,030,400          167          WER            2            B
                                                STRUCTURES.                                                                                             
GOLDEN GATE NRA..............................  REHABILITATE MARIN DISTRICT ROADS....      10,032,000          857          WER            3            R
GOLDEN GATE NRA..............................  REHABILITATE SAN FRANCISCO DISTRICT         4,620,000          858          WER            3            R
                                                ROADS.                                                                                                  
GRAND CANYON NP..............................  CONSTRUCT REPLACEMENT HOUSING........      16,800,000          143          WER            1            H
GRAND CANYON NP..............................  REPLACE NORTH RIM PIPELINE and             11,800,000          319          WER            1            U
                                                TREATMENT SYSTEM.                                                                                       
GRAND CANYON NP..............................  LANDFILL CLOSURE.....................       6,300,000          190          WER            1            L
GRAND CANYON NP..............................  CONSTRUCT SOUTH RIM ORIENTATION......      21,900,000            1          WER            5            B
GRAND CANYON NP..............................  REHABILITATE SUBSTANDARD HOUSING.....       7,545,600          348          WER            1            H
GRAND CANYON NP..............................  SAFETY RECONSTRUCTION OF WEST RIM           7,388,400          196          WER            1            R
                                                DRIVE.                                                                                                  
GRAND CANYON NP..............................  CONSTRUCT PUBLIC RESTROOMS...........       3,301,200          121          WER            5            B
GRAND CANYON NP..............................  REALIGN/REPAIR EAST RIM ROAD.........      11,352,000          272          WER            3            R
GRAND CANYON NP..............................  RECONSTRUCT SOUTH RIM ROADS..........      50,160,000          110          WER            3            R
GRAND CANYON NP..............................  RECONSTRUCT WEST RIM DRIVE...........       7,128,000          196          WER            1            R
GRAND PORTAGE NM.............................  REMOVE HOUSING and MTNCE. ACTIVITIES        3,240,000          106          MWR            2            B
                                                FROM HIST. RES.                                                                                         
GRAND PORTAGE NM.............................  CONSTRUCT VISITOR CENTER/                   4,380,000          105          MWR            5            B
                                                ADMINISTRATIVE FACILITY.                                                                                
GRAND PORTAGE NM.............................  RELOCATE ROADS.......................       1,716,000          108          MWR            2            R
GRAND TETON NP...............................  COMPLETE FINAL SURFACE FOR 31.7 MILES      14,784,000          328          RMR            3            R
                                                OF MAIN ROAD.                                                                                           
GRAND TETON NP...............................  REPAIR UTILITY SYSTEMS PARKWIDE......      30,000,000          102          RMR            3            U
GRAND TETON NP...............................  REPLACE PARK HOUSING TO MEET               25,836,000          148          RMR            3            H
                                                STANDARDS.                                                                                              
GREAT BASIN NP...............................  REPAIR ROAD SURFACE and SHOULDERS....       5,940,000          197          WER            3            R
GREAT SAND DUNES NM..........................  EXPAND VISITOR CENTER THRU                  1,900,000          103          RMR            5            B
                                                PARTNERSHIP.                                                                                            
GREAT SAND DUNES NM..........................  WIDEN and REHABILITATE ROAD..........       2,640,000          126          RMR            3            R
GREAT SMOKY MOUNTAINS NP.....................  CONSTRUCT OCONOLUFTEE VISITOR CENTER.       8,000,000          129          SER            5            B
GREAT SMOKY MOUNTAINS NP.....................  REPLACE FOUR BRIDGES.................       3,696,000          319          SER            3            R
GREAT SMOKY MOUNTAINS NP.....................  COMPLETE 33.5 MILES OF FOOTHILLS           34,980,000          109          SER            4            R
                                                PKWY. and ASSOC. FAC.                                                                                   
GREAT SMOKY MOUNTAINS NP.....................  CONST INTERP CTR, PICNIC AREA, RDS         22,680,000          314          SER            5            B
                                                and UTI.                                                                                                
GREAT SMOKY MOUNTAINS NP.....................  REHAB ABRAMS, GREENBRIER, BIG CREEK         1,452,000          324          SER            3            R
                                                RDS.                                                                                                    
GUADALUPE MOUNTAINS NP.......................  CONSTRUCT TRAIL SYSTEM (PHASE 4......       1,200,000          110          SWR            2            L
GUADALUPE MOUNTAINS NP.......................  CONSTRUCT PINE SPRINGS CAMPGROUND....       1,560,000          202          SWR            4            L
GUADALUPE MOUNTAINS NP.......................  SURFACE DOG CANYON ENTRANCE ROAD.....       1,056,000          207          SWR            3            R
HAGERMAN FOSSIL BEDS NM......................  CONSTRUCT RESEARCH CENTER/MUSEUM.....      16,800,000          101          PNR            4            B
HALEAKALA NP.................................  REHAB HOUSE OF THE SUN VIS. CTR. and        3,144,000          105          WER            3            B
                                                COMFORT STATION.                                                                                        
HALEAKALA NP.................................  CONSTRUCT KIPAHULA WATER SYS.,              4,087,200          153          WER            4            B
                                                RESTROOM, ADMIN. FAC.                                                                                   
HAMILTON GRANGE NAT MEML.....................  REHABILITATE and RELOCATE HAMILTON         13,080,000          105          NAR            2            B
                                                GRANGE.                                                                                                 
HAMPTON NHS..................................  RESTORE DETERIORATED HISTORIC               9,600,000          209          MAR            2            B
                                                STRUCTURES.                                                                                             
HARPERS FERRY NHP............................  STABILIZE HISTORIC STRUCTURES........       2,673,600          118          NCR            2            B
HARRY S TRUMAN NHS...........................  REHAB TRUMAN AND NOLAND HISTORIC            1,200,000          200          MWR            2            B
                                                HOUSES.                                                                                                 
HAWAII VOLCANOES NP..........................  REHABILITATE CRATER RIM DRIVE........       6,996,000          211          WER            3            R
HERBERT HOOVER NHS...........................  CONSTRUCT FARM ROAD..................       1,848,000          162          MWR            3            R
HERBERT HOOVER NHS...........................  CONSTRUCT MAINTENANCE FACILITY.......         840,000          743          MWR            5            B
HERBERT HOOVER NHS...........................  STABILIZE and ADAPTIVELY RESTORE 8          2,880,000          110          MWR            2            B
                                                HISTORIC HOUSES.                                                                                        
HOME OF FDR NHS..............................  RESTORE/REHABILITATE FDR HOME AND           7,042,000          137          NAR            2            B
                                                SITE.                                                                                                   
HOME OF FDR NHS..............................  REHABILITATE ROADS, BRIDGES, and            6,204,000          138          NAR            3            R
                                                PARKWAY.                                                                                                
HOPEWELL FURNACE NHS.........................  COMPLETE PRESERVATION OF FURNACE            6,000,000          195          MAR            2            L
                                                RESOURCES.                                                                                              
HORACE ALBRIGHT TRAINING CTR.................  REHABILITATE TRAINING CENTER COMPLEX.       6,241,000            1         WASO            3            B
HOT SPRINGS NP...............................  REHABILITATE/RESTORE BATHHOUSE ROW         10,100,000          145          SWR            2            B
                                                STRUCTURES.                                                                                             
HOT SPRINGS NP...............................  UPGRADE GULPHA GORGE CAMPGROUND......       2,400,000          245          SWR            3            L
HOVENWEEP NM.................................  BUILD VISITOR CENTER/RANGER STATION         3,670,000          134          RMR            4            B
                                                and SUPPORT FAC.                                                                                        
HUBBELL TRADING POST NHS.....................  CONTROL EROSION IN PUEBLO COLORADO            840,000          158          SWR            2            L
                                                WASH.                                                                                                   
HUBBELL TRADING POST NHS.....................  IMPROVE VISITOR USE, MTNCE., and            3,000,000          107          SWR            4            B
                                                CURATORIAL FACILITIES.                                                                                  
INDEPENDENCE NHP.............................  IMPROVE/REHABILITATE UTILITIES.......      80,000,000          412          MAR            1            U
INDEPENDENCE NHP.............................  REHABILITATE INDEPENDENCE MALL WALKS       18,600,000          168          MAR            1            L
                                                AND WALLS.                                                                                              
INDIANA DUNES NL.............................  REMOVE ASBESTOS FROM 250 STRUCTURES..       6,960,000          510          MWR            1            B
INDIANA DUNES NL.............................  CONSTRUCT WEST UNIT ACCESS ROAD......       7,920,000          288          MWR            5            R
INDIANA DUNES NL.............................  IMPROVE PARK ROADS (INCLUDES PKG 295.      29,040,000          294          MWR            3            R
ISLE ROYALE NP...............................  REPLACE ELEVATED WATER TANK..........       3,520,000          188          MWR            1            U
ISLE ROYALE NP...............................  REHABILITATE RANGER III..............       2,300,000          319          MWR            1            L
ISLE ROYALE NP...............................  CONSTRUCT EMPLOYEE HOUSING DUPLEX....         786,000          400          MWR            1            H
ISLE ROYALE NP...............................  CONSTRUCT 3 EMPLOYEE HOUSING DUPLEXES       2,280,000          117          MWR            5            H
JAMES A. GARFIELD NHS........................  REHABILITATE FIRE and INTRUSION ALARM       7,308,000          103          MWR            2            B
                                                SYSTEMS.                                                                                                
JAMES A. GARFIELD NHS........................  RECONSTRUCT ROAD and PARKING.........         924,000          164          MWR            3            R
JEAN LAFITTE NHP and PRES....................  PROVIDE THIBODEAU LANDSCAPING and           1,920,000          178          SWR            4            L
                                                PARKING.                                                                                                
JEFFERSON NAT EXPANSION MEML.................  REPLACE ARCH HANDICAPPED ACCESS RAMPS       2,340,000          241          MWR            1            B
JEFFERSON NAT EXPANSION MEML.................  CONSTRUCT PARKING GARAGE and GROUNDS        1,560,000          220          MWR            5            B
                                                MTNCE. FAC.                                                                                             
JOHN D. ROCKEFELLER MEM PKWY.................  DEVELOPMENT OF FLAGG RANCH FACILITIES      16,300,000          131          RMR            5            B
JOHN DAY FOSSIL BEDS NM......................  CONSTRUCT VISITOR/RESEARCH CENTER....      14,400,000          105          PNR            5            B
JOSHUA TREE NM...............................  RECONSTRUCT ROADS, PARKING, and            27,720,000          173          WER            3            R
                                                CAMPGROUND ROADS.                                                                                       
JOSHUA TREE NM...............................  REHABILITATE OASIS VISITOR CENTER and       4,873,200          388          WER            3            B
                                                ADMIN. BLDG.                                                                                            
JOSHUA TREE NM...............................  RECONSTRUCT/REHABILITATE NARROW            17,160,000          174          WER            3            R
                                                UNSAFE ROADS.                                                                                           
KATMAI NP....................................  CONSTRUCT LAKE CAMP FACILITIES.......       1,726,000          102          AKR            4            L
KATMAI NP....................................  RELOCATE BROOKS CAMP FACILITIES/           10,600,000        100BC          AKR            2            B
                                                REPAIR VTS ROAD.                                                                                        
KENAI FJORDS NP..............................  CONSTRUCT VISITOR CENTER/HEADQUARTERS      11,500,000        100SW          AKR            3            U
                                                FACILITY.                                                                                               
KENAI FJORDS NP..............................  IMPROVE ACCESS AND VISITOR FACILITIES       2,800,000        100EG          AKR            3            B
KEWEENAW NHP.................................  STABILIZE CORE BUILDINGS.............       4,716,000          100          MWR            2            B
LAKE CLARK NP and PRES.......................  CONSTRUCT HOUSING and SUPPORT               6,939,000        100PA          AKR            4            B
                                                FACILITIES.                                                                                             
LAKE MEAD NRA................................  UPGRADE WATER TREATMENT AT KATHERINE.       3,095,000           69          WER            1            U
LAKE MEAD NRA................................  MITIGATE STRUCTURAL FLOODING PROBLEMS      29,600,000          853          WER            1            L
LAKE MEAD NRA................................  SAFETY RECONSTRUCTION LAKESHORE ROAD.      32,340,000          242          WER            1            R
LAKE MEAD NRA................................  REHAB NORTH SHORE ROAD and CONNECT         55,440,000          457          WER            1            R
                                                ACCESS.                                                                                                 
LAKE MEAD NRA................................  ENTRANCE STATION PROGRAM.............      15,248,400          594          WER            5            B
LAKE MEAD NRA................................  IMPROVE ROAD TO PRINCESS COVE........       2,508,000          700          WER            3            R
LAKE MEREDITH NRA............................  RECONSTRUCT/RECONNECT/REPAIR WATER          4,400,000          210          SWR            1            U
                                                SYSTEM.                                                                                                 
LAKE MEREDITH NRA............................  REHABILITATE/CONSTRUCT CAMPGROUNDS         33,480,000          110          SWR            3            L
                                                and RESTROOMS.                                                                                          
LAKE MEREDITH NRA............................  RECONSTRUCT ACCESS ROADS and PARKINGS       7,788,000          185          SWR            3            R
LAKE MEREDITH NRA............................  CONNECT PARK TO FRITCH WATER SYSTEM..         960,000          192          SWR            3            U
LASSEN VOLCANIC NM...........................  UPGRADE HEADQUARTERS UTILITY SYSTEMS.       4,244,400          325          WER            3            U
LASSEN VOLCANIC NM...........................  REPAIR MAIN PARK ROAD................      13,596,000          101          WER            3            R
LASSEN VOLCANIC NM...........................  PAVE BUTTE LAKE ACCESS and CAMPGROUND       1,716,000          312          WER            3            R
LAVA BEDS....................................  RECONSTRUCT SOUTHEAST ENTRANCE ROAD..       5,940,000          302          WER            3            R
LAVA BEDS NM.................................  RECONSTUCT S.E. ENTRANCE and MEDICINE       5,940,000          302          WER            3            R
                                                LAKE ROADS.                                                                                             
LINCOLN BOYHOOD NM...........................  RELOCATE COUNTY ROADS A and B/UPGRADE       2,772,000          126          MWR            3            R
                                                PARKING.                                                                                                
LINCOLN HOME NHS.............................  STABILIZE/RESTORE STUVE HOUSE........       3,144,000          403          MWR            2            B
LITTLE BIGHORN NB............................  CONSTRUCT INDIAN MEMORIAL............         900,000          147          RMR            5            L
LOWELL NHP...................................  COMPLETE BOOTT MILL..................         958,000          117          NAR            2            B
LOWELL NHP...................................  REHAB VISITOR CENTER PARKING.........         660,000          101          NAR            4            R
LYNDON B. JOHNSON NHP........................  CONSTRUCT MAINTENANCE/BUS SERVICE           3,600,000          135          SWR            5            B
                                                AREA.                                                                                                   
LYNDON B. JOHNSON NHP........................  REHABILITATE PARK ROADS..............       1,980,000          193          SWR            3            R
LYNDON B. JOHNSON NHP........................  EXTEND WATER SYSTEM TO JUNCTION               600,000          198          SWR            2            U
                                                SCHOOL.                                                                                                 
MAMMOTH CAVE NP..............................  RENOVATE VISITOR CENTER..............       5,327,000          171          SER            3            B
MAMMOTH CAVE NP..............................  CONSTRUCT NEW ADMINISTRATION BUILDING       9,720,000          185          SER            5            B
MANASSAS NAT BATTLEFIELD PARK................  RESTORE DISTURBED STUART'S HILL             6,828,000          225          NCR            2            L
                                                BATTLEGROUND.                                                                                           
MANASSAS NAT BATTLEFIELD PARK................  PRESERVE HISTORIC RESOURCES FOR             1,382,000          155          NCR            2            L
                                                VISITOR USE.                                                                                            
MESA VERDE NP................................  STABILIZE AND RESTORE PREHISTORIC          12,000,000          239          RMR            2            B
                                                STRUCTURES.                                                                                             
MESA VERDE NP................................  COMPLETE WATERLINE REPLACEMENT.......       4,500,000          223          RMR            3            U
MESA VERDE NP................................  CONSTRUCT ENTRANCE STATION and              1,542,000          120          RMR            5            B
                                                COMPLETE ROAD.                                                                                          
MESA VERDE NP................................  CORRECT ENTRANCE ROAD FAILURE........       9,636,000          278          RMR            3            R
MESA VERDE NP................................  RECONSTRUCT WETHERILL ROAD...........       7,920,000          225          RMR            3            R
MINUTE MAN NHP...............................  PRESERVE/REHABILITATE 29 HIST. BATTLE       7,200,000          171          NAR            1            B
                                                RD. STRUCTURES.                                                                                         
MISSISSIPPI NAT RIVERandRECR. AREA...........  DEVELOP PARTNERSHIP EDUC. FAC. IN           2,564,000          110          MWR            4            B
                                                SCIENCE MUSEUM.                                                                                         
MISSISSIPPI NR&RA............................  CONSTRUCT PARTNERSHIP EDUCATION             4,281,000          114          MWR            4            B
                                                CENTER.                                                                                                 
MONOCACY NB..................................  RESTORE STRUCTURE FOR PRESERVATION          5,940,000          337          NCR            2            B
                                                TRAINING.                                                                                               
MONTEZUMA CASTLE NM..........................  DEVELOP MONTEZUMA WELL INFRASTRUCTURE       2,940,000          100          SWR            4            B
                                                & FAC.                                                                                                  
MORRISTOWN NHP...............................  REHABILITATE PARK TOUR ROADS.........       7,128,000          187          NAR            3            R
MOUNT RAINIER NP.............................  REHABILITATE JACKSON VISITOR CENTER..       4,400,000          399          PNR            3            B
MOUNT RAINIER NP.............................  REPLACE SUNRISE LODGE................       5,400,000          315          PNR            1            B
MOUNT RAINIER NP.............................  REHABILITATE HIGHWAY 410.............       6,864,000         349A          PNR            1            R
MOUNT RAINIER NP.............................  CONSTRUCT TAHOMA WOODS ENTRANCE/            1,800,000          311          PNR            5            B
                                                CONTACT STATION.                                                                                        
MOUNT RAINIER NP.............................  REHABILITATE PARADISE INN and ANNEX..       8,400,000          370          PNR            3            B
MOUNT RAINIER NP.............................  REHABILITATE HIGHWAY 123.............      25,080,000         349B          PNR            1            R
MOUNT RAINIER NP.............................  REHABILITATE CARBON RIVER FACILITIES.       6,000,000          316          PNR            2            B
MOUNT RAINIER NP.............................  RECONSTRUCT BACKBONE RIDGE VIADUCT...       3,036,000          386          PNR            1            R
MOUNT RUSHMORE N MEML........................  REPLACE WASTEWATER TREATMENT SYSTEM..       8,989,000          182          RMR            3            U
MOUNT RUSHMORE N MEML........................  CONSTRUCT EXHIBITS and MTNCE. FAC./        12,000,000          182          RMR            5            B
                                                REHABILITATE STUDIO.                                                                                    
NATCHEZ TRACE PARKWAY........................  CONSTRUCT PARKWAY....................      55,440,000          300          SER            5            R
NATCHEZ TRACE PARKWAY........................  CONSTRUCT NORTH VISITOR CENTER and          6,000,000         300A          SER            5            B
                                                MAINTENANCE AREA.                                                                                       
NATCHEZ TRACE PARKWAY........................  CONSTRUCT FOUR OVERPASSES............       5,280,000          238          SER            5            R
NATCHEZ TRACE PARKWAY........................  REPAIR/REPLACE BRIDGES...............      17,556,000          264          SER            3            R
NATCHEZ TRACE PARKWAY........................  RESURFACE VARIOUS SECTIONS OF PARKWAY      99,000,000          250          SER            3            R
NATIONAL CAPITOL AREA........................  CONSTRUCT MUSEUM/ARCHEOLOGICAL             16,000,000         323A          NCR            5            B
                                                STORAGE FACILITY.                                                                                       
NATIONAL CAPITOL AREA........................  REHABILITATE and ADD SPACE TO              17,488,800          730          NCR            3            B
                                                HEADQUARTERS BUILDING.                                                                                  
NATIONAL CAPITOL PARKS-CENTRAL...............  RESTORE LINCOLN AND JEFFERSON              15,400,000          758          NCR            2            B
                                                MEMORIALS.                                                                                              
NATIONAL CAPITOL PARKS-CENTRAL...............  STABILIZE AND PRESERVE WASHINGTON          18,000,000          448          NCR            2            B
                                                MONUMENT.                                                                                               
NATIONAL CAPITOL PARKS-CENTRAL...............  REPAIR MONUMENT CORES AND SEAWALLS...      78,600,000          731          NCR            1            L
NATIONAL CAPITOL PARKS-CENTRAL...............  PROVIDE FORDS THEATRE HANDICAPPED           7,900,000          790          NCR            2            B
                                                ACCESS.                                                                                                 
NATIONAL CAPITOL PARKS-CENTRAL...............  IMPROVE WASHINGTON MONUMENT ACCESS...       9,690,000          430          NCR            3            L
NATIONAL CAPITOL PARKS-CENTRAL...............  MEMORIAL CORE-RECONSTRUCT EAST BASIN        4,356,000          450          NCR            1            R
                                                DRIVE.                                                                                                  
NATIONAL CAPITOL PARKS-CENTRAL...............  REHABILITATE LINCOLN CIRCLE AREA/           5,502,000          825          NCR            2            R
                                                PROVIDE VIS. ACCESS.                                                                                    
NATIONAL CAPITOL PARKS-CENTRAL...............  REHABILITATE H-1 PARK POLICE STABLE         3,000,000          827          NCR            3            B
                                                and CORRECT DRAINAGE.                                                                                   
NATIONAL CAPITOL PARKS-CENTRAL...............  MEMORIAL CORE-RECONSTRUCT INDIANA and            405E          NCR            1            R             
                                                MAINE AVENUES.                                                                                          
NATIONAL CAPITOL PARKS-CENTRAL...............  DC MALL--ALTERNATIVE TRANSPORTATION         2,640,000         2005          NCR            5            R
                                                MODES.                                                                                                  
NATIONAL CAPITOL PARKS-CENTRAL...............  RECONSTRUCT INDIANA and MAINE AVES.,       29,172,000          405          NCR            3            R
                                                EASTBOUND.                                                                                              
NATIONAL CAPITOL PARKS-CENTRAL...............  RECONSTRUCT JEFFERSON DRIVE..........       2,904,000         405B          NCR            3            R
NATIONAL CAPITOL PARKS-CENTRAL...............  RECONSTRUCT ROADS, EAST POTOMAC PARK.       5,016,000         405C          NCR            3            R
NATIONAL CAPITOL PARKS-CENTRAL...............  RECONSTRUCT LINCOLN MEM. CIRCLE and         3,960,000         405D          NCR            1            R
                                                APPROACHES.                                                                                             
NATIONAL CAPITOL PARKS-CENTRAL...............  RECONSTRUCT CONSTITUTION AVE.........       7,128,000         405G          NCR            3            R
NATIONAL CAPITOL PARKS-EAST..................  RESTORE FORT WASHINGTON..............       4,940,000          106          NCR            2            B
NATIONAL CAPITOL PARKS-EAST..................  REHABILITATE FREDERICK DOUGLASS HOME        1,800,000          738          NCR            2            B
                                                VISITOR CENTER.                                                                                         
NATIONAL CAPITOL PARKS-EAST..................  RECONSTRUCT RENO ROAD OVERPASS             10,560,000          315          NCR            3            R
                                                (SUITLAND PKWY).                                                                                        
NAVAJO NM....................................  CONSTRUCT PEDESTRIAN TRAIL TUNNEL....         840,000          141          SWR            3            L
NAVAJO NM....................................  REHABILITATE ENTRANCE AND CAMPGROUND          660,000          144          SWR            3            R
                                                ROADS.                                                                                                  
NEW JERSEY COASTAL HER. TRAIL................  INITIAL INTERPRETIVE DEVELOPMENTS....       7,800,000          102          NAR            4            L
NEW RIVER GORGE NR...........................  STABILIZE/PRESERVE/ADAPT THURMOND          33,000,000          126          MAR            4            L
                                                HIST. STRUCT./SITE.                                                                                     
NEW RIVER GORGE NR...........................  DUN GLEN/SOUTHSIDE JUNCTION                 3,240,000          155          MAR            4            L
                                                DEVELOPMENT.                                                                                            
NEW RIVER GORGE NR...........................  GRANDVIEW CULTURAL HERITAGE CENTER         36,000,000          158          MAR            4            L
                                                DEVELOPMENT.                                                                                            
NEW RIVER GORGE NR...........................  KAYMOOR DEVELOPMENT..................       3,600,000          156          MAR            4            L
NEW RIVER GORGE NR...........................  HEADQUARTERS DEVELOPMENT (PHASE IV)..       2,700,000         108E          MAR            4            L
NEW RIVER GORGE NR...........................  MIDDLE GORGE ACCESS..................       3,100,000          154          MAR            4            L
NEW RIVER GORGE NR...........................  REHABILITATE PARK ROADS..............       2,640,000          138          MAR            3            R
NEZ PERCE NHS................................  CONSTRUCT WHITEBIRD INTERP FACILITIES         960,000          160          PNR            4            B
NEZ PERCE NHS................................  REPLACE SPALDING ROADS and PARKING...       1,056,000          159          PNR            3            R
NORTH CASCADES NP............................  REPAIR/STABILIZE GOLDEN WEST VISITOR        2,486,000          107          PNR            3            B
                                                CENTER.                                                                                                 
NORTH CASCADES NP............................  REPLACE NEWHALEM and HARLEQUIN              6,072,000          404          PNR            1            R
                                                BRIDGES.                                                                                                
NORTH CASCADES NP............................  PROVIDE STEHEKIN EMPLOYEE HOUSING....       1,200,000          369          PNR            5            H
NORTH CASCADES NP............................  DEVELOP JOINT US/CANADIAN UTILITIES         3,000,000          391          PNR            4            U
                                                AT HOZOMEEN.                                                                                            
NORTH CASCADES NP............................  DEVELOP/IMPROVE HIGHWAY 20 FACILITIES       2,160,000          388          PNR            1            R
NORTH CASCADES NP............................  RECONSTRUCT CASCADE RIVER ROAD.......         792,000          343          PNR            1            R
NORTH CASCADES NP............................  REHABILITATE STEHEKIN ROAD...........       1,980,000          344          PNR            1            R
NORTHWEST ALASKA AREAS.......................  CONSTRUCT VISITOR CTR./HEADQTRS. and       10,510,000        100KZ          AKR            4            B
                                                MTNCE. FACILITIES.                                                                                      
NORTHWEST ALASKA AREAS.......................  CONSTRUCT KOTZEBUE EMPLOYEE HOUSING..       4,690,000          130          AKR            4            B
OLYMPIC NP...................................  ELWHA DAM REMOVAL/RESTORATION........     126,600,000          404          PNR            2            L
OLYMPIC NP...................................  EXPAND VISITOR FACILITIES AT HOH            4,080,000          405          PNR            5            B
                                                RAINFOREST.                                                                                             
OLYMPIC NP...................................  CONSTRUCT KALALOCH VISITOR CENTER....      10,200,000          360          PNR            5            B
OLYMPIC NP...................................  RECONSTRUCT EAST BEACH and LOG CABIN        4,752,000          311          PNR            1            R
                                                RESORT ROADS.                                                                                           
OLYMPIC NP...................................  CONSTRUCT TWIN CREEK BRIDGE..........         924,000          406          PNR            2            R
OLYMPIC NP...................................  REPLACE FINLEY CREEK BRIDGE..........       1,056,000          407          PNR            3            R
ORGAN PIPE CACTUS NM.........................  REHABILITATE PAVED PUBLIC ROADS......       1,320,000          439          WER            3            R
OZARK NAT SCENIC RIVER.......................  CONSTRUCT REGIONAL CULTURAL/VIS. CTR./      9,600,000          459          MWR            5            B
                                                ADMIN. COMPLEX.                                                                                         
OZARK NSR....................................  RELOCATE CAMPGROUND and CONC. FAC.         12,184,800          103          MWR            2            B
                                                FROM FLOODPLAIN.                                                                                        
OZARK NSR....................................  REHABILITATE PEAVINE ROAD............       4,356,000          506          MWR            3            R
PADRE ISLAND NS..............................  CONSTRUCT SEWAGE TREATMENT FACILITIES       1,046,000          215          SWR            4            U
PADRE ISLAND NS..............................  REHABILITATE/RELOCATE BIRD ISLAND           1,188,000          200          SWR            3            R
                                                BASIN ROAD.                                                                                             
PADRE ISLAND NS..............................  CONTRUCT MAINTENANCE SHOP and STORAGE       2,160,000          188          SWR            5            B
                                                AREA.                                                                                                   
PEA RIDGE NMP................................  RELOCATE OVERHEAD UTILITY LINES......         900,000          134          SWR            3            U
PEA RIDGE NMP................................  CONSTRUCT MAINTENANCE/STORAGE AREA...       1,200,000          111          SWR            5            B
PEA RIDGE NMP................................  CONSTRUCT ELKHORN TAVERN COMFORT            1,200,000          125          SWR            5            B
                                                STATION and PARKING.                                                                                    
PECOS NHP....................................  IMPROVE SEWAGE TREATMENT and                3,480,000          143          SWR            3            U
                                                REHABILITATE RANCH.                                                                                     
PECOS NHP....................................  REHABILITATE ENTRANCE ROAD...........         660,000          137          SWR            3            R
PERRY'S VICTORY andINT PEACE MEML............  CONSTRUCT VISITOR CENTER.............      13,650,000          104          MWR            5            B
PETERSBURG NB................................  PRESERVE/PROTECT EARTHWORKS and OTHER       8,400,000          249          MAR            2            L
                                                PRIMARY RES.                                                                                            
PETERSBURG NB................................  REHABILITATE/DEVELOP INTERPRETIVE/          7,200,000          248          MAR            4            L
                                                VISITOR FACILITIES.                                                                                     
PETERSBURG NB................................  REHABILITATE MAIN PARK ROAD and             1,980,000          132          MAR            3            R
                                                BRIDGES.                                                                                                
PETRIFIED FOREST NP..........................  REHABILITATE PAINTED DESERT INN and         2,851,000          109          SWR            2            B
                                                CABINS.                                                                                                 
PETROGLYPH NM................................  REHABILITATE/EXPAND VISITOR CENTER...       1,156,000            1          SWR            4            B
PETROGLYPH NM................................  FENCE BOUNDARY/REMOVE DEBRIS.........         960,000          103          SWR            2            L
PETROGLYPH NM................................  CONSTRUCT NEW VISITOR CENTER.........      13,080,000          106          SWR            4            B
PICTURED ROCKS NL............................  CONSTRUCT ADMINISTRATION and PUBLIC         3,800,000          168          MWR            5            B
                                                USE FACILITY.                                                                                           
PICTURED ROCKS NL............................  RESTORE LIGHTHOUSE SEAWALL...........         943,200          107          MWR            2            L
PICTURED ROCKS NL............................  REHAB 12 MILES BEACH ROUTE 16........      16,764,000          191          MWR            5            R
PICTURED ROCKS NL............................  PAVING--AuSABLE POINT................         660,000          200          MWR            3            R
PICTURED ROCKS NL............................  PAVE ROAD and PARKING--MINER'S BEACH.         396,000          200          MWR            3            R
POINT REYES NS...............................  RECONSTRUCT TOMALES ROAD.............       1,320,000          261          WER            3            R
POINT REYES NS...............................  PAVE PALO MARIN TRAILHEAD ROAD.......         924,000          262          WER            3            R
PRESIDENT'S PARK.............................  ELIMINATE ENV. HAZARD AT WHITE HOUSE          649,000          473          NCR            1            B
                                                GREENHOUSE.                                                                                             
PRESIDENT'S PARK.............................  IMPLEMENT WHITE HOUSE COMPREHENSIVE        90,000,000          249          NCR            5            B
                                                DESIGN.                                                                                                 
PRINCE WILLIAM FOREST PARK...................  REPLACE CAMPGROUND WATER LINES.......       7,450,000          239          NCR            1            U
PRINCE WILLIAM FOREST PARK...................  CONSTRUCT VISITOR CENTER.............       4,200,000          152          NCR            5            B
PU'UHONUA O HONAUNAU.........................  CONSTRUCT REPLACEMENT OFFICE and            3,458,400          113          WER            5            B
                                                MAINTENANCE SHOP.                                                                                       
PUUKOHOLA HEIAU..............................  RELOCATE VISITOR CTR., ADMIN., and          1,886,400          107          WER            3            B
                                                MAINTENANCE SHOP.                                                                                       
REDWOOD NP...................................  REALIGN DAVISON ROAD.................       4,224,000          186          WER            3            R
RICHMOND NAT BATTLEFIELD PARK................  STABILIZE DREWERY'S BLUFF and              14,400,000          170          MAR            2            L
                                                EARTHWORKS.                                                                                             
RICHMOND NBP.................................  REPAIR/REHABILITATE EXISTING VISITOR       10,800,000          169          MAR            3            L
                                                USE FACILITIES.                                                                                         
RICHMOND NBP.................................  REHABILITATE PARK ROADS..............       2,772,000          129          MAR            3            R
ROCK CREEK PARK..............................  RESTORE HISTORIC PIERCE GRIST MILL...       1,223,000          227          NCR            2            B
ROCK CREEK PARK..............................  REHABILITATE MERIDIAN HILL                 10,471,200          120          NCR            2            B
                                                INFRASTRUCTURE.                                                                                         
ROCK CREEK PARK..............................  CORRECT CARTER BARON STRUCTURAL               684,000          204          NCR            2            B
                                                PROBLEMS.                                                                                               
ROCK CREEK PARK..............................  REHABILITATE ROCK CREEK PARKWAY and        34,452,000          318          NCR            1            R
                                                ADJACENT TRAIL.                                                                                         
ROCKY MOUNTAIN NP............................  CONSTRUCT VEHICLE MAINTENANCE/STORAGE         506,400          278          RMR            3            B
                                                BUILDINGS.                                                                                              
ROCKY MOUNTAIN NP............................  REPLACE OBSOLETE SEASONAL HOUSING....      28,044,000          123          RMR            3            H
ROCKY MOUNTAIN NP............................  UPGRADE FALL RIVER ENTRANCE                 2,443,200          104          RMR            5            B
                                                FACILITIES.                                                                                             
ROCKY MOUNTAIN NP............................  REBUILD BEAR LAKE ROAD...............       4,752,000          324          RMR            3            R
SAGUARO NM...................................  REHABILITATE TUCSON MOUNTAIN ROADS...       9,636,000          255          WER            3            R
SAINT GAUDENS NHS............................  CONSTRUCT MAINTENANCE AND EXHIBIT           7,040,000         121A          NAR            5            B
                                                BUILDING.                                                                                               
SAINT GAUDENS NHS............................  PHASE II DEVELOPMENTS................       6,632,400         121B          NAR            1            L
SALINAS PUEBLO MISSIONS NHP..................  CONSTRUCT ABO VISITOR FACILITIES.....       3,120,000          179          SWR            4            B
SALINAS PUEBLO MISSIONS NHP..................  REHABILITATE ENTRANCE ROADS..........       1,188,000          173          SWR            3            R
SALINAS PUEBLO MISSIONS NHP..................  CONSTRUCT GRAN QUIVIRA VISITOR              3,120,000          178          SWR            4            B
                                                FACILITIES.                                                                                             
SAN ANTONIO MISSIONS NHP.....................  IMPROVE HEALTH, SAFETY, VISITOR             3,111,000          190          SWR            3            B
                                                SERVICES-SAN JUAN.                                                                                      
SAN ANTONIO MISSIONS NHP.....................  REHABILITATE SAN JUAN MISSION               3,960,000          187          SWR            2            B
                                                STRUCTURES.                                                                                             
SAN ANTONIO MISSIONS NHP.....................  REHABILITATE PARKING AREAS...........         792,000          185          SWR            3            R
SAN FRANCISCO MARITIME NHS...................  RESTORE ENDANGERED SHIP C.A. THAYER..      11,004,000          643          WER            2            B
SAN FRANCISCO MARITIME NHS...................  REHABILITATE THREATENED HISTORIC            6,602,400          518          WER            2            B
                                                MUSEUM BUILDING.                                                                                        
SAN FRANCISCO MARITIME NHS...................  COMPLETE RESTORATION OF SAILING SHIP        3,144,000          635          WER            2            B
                                                BALCLUTHA.                                                                                              
SANTA MONICA NRA.............................  REHABILITATE DIAMOND X AREA                 1,572,000          331          WER            3            B
                                                MAINTENANCE FACILITY.                                                                                   
SANTA MONICA NRA.............................  RANCHO SIERRA VISTA RD/SATWIWA NAT AR       1,980,000          226          WER            3            R
                                                (IN. PKG145.                                                                                            
SANTA MONICA NRA.............................  REHABILITATE CIRCLE X CAMPGROUND            1,980,000          290          WER            3            R
                                                ROADS.                                                                                                  
SARATOGA NHP.................................  REHABILITATE TOUR ROADS and WAYSIDES.       7,920,000          159          NAR            2            R
SARATOGA NHP.................................  PRESERVE SARATOGA MONUMENT and SITE..       2,360,000          159          NAR            2            L
SARATOGA NHP.................................  REHABILITATE ROADS AND PARKING.......         396,000          160          NAR            3            R
SAUGUS IRON WORKS NHS........................  PRESERVE/REHABILITATE HIST.                 2,400,000          154          NAR            2            B
                                                STRUCTURES and EXHIBITS.                                                                                
SEQUOIA and KINGS CANYON NP..................  REMOVE FACILITIES AND RESTORE GIANT         8,200,000          200          WER            2            L
                                                FOREST.                                                                                                 
SEQUOIA and KINGS CANYON NP..................  COMPLETE WUKSACHI VILLAGE                  13,900,000          130          WER            2            U
                                                INFRASTRUCTURE.                                                                                         
SEQUOIA and KINGS CANYON NP..................  RECONSTRUCT GENERALS HIGHWAY.........      40,920,000          840          WER            3            R
SEQUOIA and KINGS CANYON NP..................  CONSTRUCT/REPLACE LODGEPOLE HOUSING..      55,020,000          259          WER            5            H
SEQUOIA and KINGS CANYON NP..................  REPLACE CEDAR GROVE BRIDGE...........       3,960,000          336          WER            3            R
SEQUOIA and KINGS CANYON NP..................  PAVE GRAVEL SECTION AT MINERAL KING..       6,600,000          541          WER            5            R
SEQUOIA and KINGS CANYON NP..................  RECONSTRUCT GENERALS HIGHWAY (PHASE        16,500,000          841          WER            3            R
                                                II).                                                                                                    
SHENANDOAH NP................................  REPLACE TRAILERS/CONSTRUCT EMERGENCY       25,100,000          446          MAR            1            H
                                                FACILITY.                                                                                               
SHENANDOAH NP................................  REHABILITATE WATER/SEWER/FIRE SYSTEMS      11,800,000          455          MAR            1            U
SHENANDOAH NP................................  REHABILITATE STORM-DAMAGED TRAILS....      12,000,000          456          MAR            2            L
SHENANDOAH NP................................  REHABILITATE VISITOR FACILITIES......       4,800,000          457          MAR            3            L
SHENANDOAH NP................................  RECONSTRUCT SKYLINE DRIVE............      29,040,000          125          MAR            3            R
SHILOH NMP...................................  STABILIZE RIVERBANK..................       2,600,000          134          SER            2            L
SHILOH NMP...................................  RESURFACE TOUR ROADS, INCL. SHOULDER        3,300,000          138          SER            3            R
                                                and DRAINAGE.                                                                                           
SLEEPING BEAR DUNES NL.......................  REHABILITATE STOCKING SCENIC DRIVE          2,215,200          210          MWR            3            B
                                                FACILITIES.                                                                                             
SLEEPING BEAR DUNES NL.......................  CONSTRUCT SCENIC ROAD................      23,364,000          120          MWR            4            R
SOUTHWEST REGION.............................  REHABILITATE HISTORIC OLD SANTA FE          2,100,000          257          SWR            2            B
                                                TRAIL BUILDING.                                                                                         
SOUTHWEST REGION.............................  CONSTRUCT EMPLOYEE HOUSING AT 11            8,600,000          279          SWR            4            H
                                                PARKS.                                                                                                  
STATUE OF LIBERTY NM.........................  COMPLETE HISTORIC SEAWALL                   2,944,000            2          NAR            1            L
                                                REHABILITATION.                                                                                         
STATUE OF LIBERTY NM.........................  STABILIZE 23 ELLIS ISLAND BUILDINGS..      12,000,000          163          NAR            2            B
STATUE OF LIBERTY NM.........................  STABILIZE ELLIS ISLAND HAZARDOUS            3,600,000          161          NAR            1            L
                                                MATERIALS.                                                                                              
STEAMTOWN NHS................................  REHABILITATE PARK ROADS..............       3,960,000          900          MAR            3            R
STEPHEN MATHER TRAINING CTR..................  REHABILITATE TRAINING CENTER COMPLEX.       4,462,000            1         WASO            3            B
SUNSET CRATER VOLCANO NM.....................  CONSTRUCT MAINTENANCE COMPLEX........       1,680,000          152          SWR            5            B
SUNSET CRATER VOLCANO NM.....................  REHABILITATE PARK ROADS..............       4,224,000          900          WER            3            R
THEODORE ROOSEVELT NP........................  RECONSTRUCT/RESURFACE PARK ROADS.....      11,880,000          164          RMR            3            R
THEODORE ROOSEVELT NP........................  CONSTRUCT FLOOD PROTECTION...........         607,200          108          RMR            5            L
THOMAS STONE NHS.............................  FULL SITE DEVELOPMENT AND RESTORATION       7,080,000          108          MAR            4            L
TIMPANOGOS CAVE NM...........................  CONSTRUCT VISITOR/ADMINISTRATIVE            7,605,000          135          RMR            3            B
                                                CENTER COMPLEX.                                                                                         
TIMUCUAN ECOL. and HIST. PRESERVE............  CONSTRUCT VISITOR FACILITIES FOR NEW        9,728,000          128          SER            4            B
                                                AREA.                                                                                                   
TONTO NM.....................................  CONSTRUCT VIS. CTR. RESTROOMS and           1,065,000          138          SWR            3            B
                                                WASTEWATER PLANT.                                                                                       
TONTO NM.....................................  RECONSTRUCT ENTRANCE/PICNIC ROADS and       1,848,000          135          WER            3            R
                                                PARKING.                                                                                                
ULYSSES S. GRANT NHS.........................  PRESERVE/RESTORE GRANT HOME AND SITE.      10,900,000          100          MWR            2            B
UPPER DELAWARE S&RR..........................  DEVELOP INITIAL PARK VISITOR FACILITY       9,000,000          123          MAR            4            L
UPPER DELAWARE S&RR..........................  ROEBLING BRIDGE RECONSTRUCTION (PHASE       2,640,000          110          MAR            5            R
                                                II).                                                                                                    
UPPER DELAWARE SCENandREC.RIVER..............  COMPLETE INITIAL FACILITIES                 5,760,000          130          MAR            2            B
                                                DEVELOPMENT.                                                                                            
VALLEY FORGE NHP.............................  REPAIR/REHABILITATE HIST. STRUCT./         13,200,000          202          MAR            3            L
                                                COLLECTION STORAGE.                                                                                     
VANDERBILT MANSION NHS.......................  PRESERVE VANDERBILT MANSION..........       8,200,000          139          NAR            2            B
VIRGIN ISLANDS NP............................  RECONSTRUCT LAMESHORE ROAD...........       1,980,000         127B          SER            3            R
VOYAGEURS NP.................................  CONSTRUCT VISITOR FACILITIES.........       3,865,000          159          MWR            5            B
VOYAGEURS NP.................................  IMPROVE CRANE LAKE ROAD..............      13,860,000          219          MWR            3            R
VOYAGEURS NP.................................  IMPROVE WEST KABETOGAMA ROADS........         660,000          220          MWR            3            R
WEIR FARM NHS................................  PRESERVE STRUCT./PROVIDE INITIAL           14,594,400          102          NAR            2            B
                                                SUPPORT FACILITIES.                                                                                     
WEIR FARM NHS................................  REHAB PARK ROADS AND PARKING.........         132,000          102          NAR            3            R
WHISKEYTOWN-SHASTA-TRINITY NRA...............  COMPLETE SOUTH SHORE ROAD PAVING.....       3,300,000          109          WER            4            R
WHITE SANDS NM...............................  CONSTRUCT PARK HEADQUARTERS BUILDING.       2,160,000          109          SWR            5            B
WHITE SANDS NM...............................  CONSTRUCT MAINTENANCE/STORAGE               1,800,000          128          SWR            5            B
                                                BUILDING.                                                                                               
WILSON'S CREEK NB............................  REPLACE DETERIORATING WASTEWATER            1,080,000          325          MWR            1            U
                                                PLANT.                                                                                                  
WILSON'S CREEK NB............................  REHABILITATE MAIN ENTRANCE ROAD......         660,000          173          MWR            3            R
WOLF TRAP FARM PARK..........................  ALLEVIATE HAZARDOUS TRAFFIC                41,184,000          208          NCR            1            R
                                                CONGESTION.                                                                                             
WOLF TRAP FARM PARK..........................  EXPAND RESTROOMS and CONCESSIONS.....       4,800,000          130          NCR            5            B
WRANGELL-ST.ELIAS NP and PRES................  CONSTRUCT VISITOR CENTER/HEADQUARTERS       7,100,000        100GL          AKR            4            B
                                                FACILITY.                                                                                               
WRIGHT BROTHERS NM...........................  CONSTRUCT AUDITORIUM ADDITION TO           11,400,000          115          SER            5            B
                                                VISITOR CENTER.                                                                                         
WUPATKI NM...................................  REHABILITATE MTNCE. AREA--SUNSET            1,700,000          101          SWR            3            B
                                                CRATER VOLCANO.                                                                                         
WUPATKI NM...................................  REHABILITATE SEWER LAGOONS...........       2,222,000          192          SWR            1            U
WUPATKI NM...................................  RECONSTRUCT MAIN LOOP ROAD...........       7,920,000          103          SWR            3            R
YELLOWSTONE NP...............................  REPAIR/REPLACE DETERIORATED HOUSING..     100,000,000          817          RMR            3            H
YELLOWSTONE NP...............................  REHABILITATE FISHING BRIDGE                36,000,000          813          RMR            3            L
                                                CAMPGROUND AND MARINA.                                                                                  
YELLOWSTONE NP...............................  RECONSTRUCT ROADS PARKWIDE...........     250,800,000          254          RMR            3            R
YELLOWSTONE NP...............................  UPGRADE MADISON and NORRIS UTILITY          4,716,000          636          RMR            3            U
                                                PLANTS.                                                                                                 
YELLOWSTONE NP...............................  IMPLEMENT LAKE DEVELOPMENT CONCEPT          4,800,000          821          RMR            3            L
                                                PLAN.                                                                                                   
YELLOWSTONE NP...............................  ALTERNATIVE TRANSPORTATION MODES.....       1,320,000         2008          RMR            5            R
YOSEMITE NP..................................  RESTORE VALLEY BY REMOVING/               137,900,000          504          WER            2            L
                                                REDESIGNING FACILITIES.                                                                                 
YOSEMITE NP..................................  UPGRADE FAILING SEWAGE AND WATER           10,500,000          383          WER            1            U
                                                SYSTEMS.                                                                                                
YOSEMITE NP..................................  REHABILITATE FAILING ELECTRICAL             8,100,000          473          WER            1            U
                                                SYSTEM.                                                                                                 
YOSEMITE NP..................................  REPLACE LIFE SAFETY COMMUNICATIONS          5,502,000           44          WER            1            U
                                                SYSTEM.                                                                                                 
YOSEMITE NP..................................  REPLACE/REHABILIATE OBSOLETE HOUSING.      31,440,000          651          WER            1            H
YOSEMITE NP..................................  RELOCATE SOUTH ENTRANCE and MARIPOSA       31,152,000          140          WER            2            L
                                                GROVE FACILITIES.                                                                                       
YOSEMITE NP..................................  RECONSTRUCT GLACIER POINT ROAD.......      15,840,000          843          WER            3            R
YOSEMITE NP..................................  RECONSTRUCT EL PORTAL ROAD...........      26,796,000          505          WER            1            R
YOSEMITE NP..................................  REHABILITATE WAWONA ROAD.............      27,984,000          565          WER            3            R
YOSEMITE NP..................................  RELOCATE/REMOVE HOUSING FROM VALLEY..      34,584,000           46          WER            2            H
YOSEMITE NP..................................  RECONSTRUCT TIOGA ROAD...............      46,200,000          146          WER            3            R
YOSEMITE NP..................................  ALTERNATIVE TRANSPORTATION MODES.....      26,400,000         2003          WER            5            R
YUKON-CHARLEY RIVERS NPRES...................  REHABILITATE HIST. BLDGS. and               3,181,000        100CC          AKR            3            B
                                                CONSTRUCT NEW FACILITIES.                                                                               
ZION NP......................................  CONSTRUCT EMPLOYEE HOUSING...........       8,634,000          178          RMR            3            H
ZION NP......................................  REBUILD PARK ROUTE 7.................       2,508,000          210          RMR            3            R
                                                                                     ----------------                                                   
      Total..................................  .....................................   5,587,776,410  ...........  ...........  ...........  ...........
--------------------------------------------------------------------------------------------------------------------------------------------------------
Objectives:                                                                                                                                             
                                                                                                                                                        
1 = Health and safety.                                                                                                                                  
2 = Resource preservation.                                                                                                                              
3 = Repair/rehabilitation of existing facilities.                                                                                                       
4 = New facilities in a new/developing park.                                                                                                            
5 = Additional facilities in an older/established park.                                                                                                 
                                                                                                                                                        
Work type:                                                                                                                                              
                                                                                                                                                        
B = Buildings: Visitor, park support, et cetra.                                                                                                         
H = Housing: Permanent, seasonal.                                                                                                                       
L = Landscape work, site restoration, et cetra.                                                                                                         
R = Roads: FLHP, Non-FLHP, bridges, et cetra.                                                                                                           
U = Utilities: Water and sewer systems, et cetra.                                                                                                       


                              NATIONAL PARK SERVICE LINE-ITEM CONSTRUCTION PROGRAM                              
                                     [Servicewide priorities by fund group]                                     
----------------------------------------------------------------------------------------------------------------
                                          Package                                                               
 SWP                 Park                  number             Project title           Field area      Amount    
----------------------------------------------------------------------------------------------------------------
                                               Small projects--under $4                                         
                                                                                                                
      Longfellow NHS                           01  Protect/conserve structures              NE       1,642,001  
                                                    and collections.                                            
      Salem Maritme NHS                       202  Complete rehabilitation of               NE       1,042,760  
                                                    Polish Club for multiple use.                               
      Gateway NRA3                            210  Rehabilitate Sandy Hook                  NE         884,250  
                                                    Lighthouse.                                                 
      Great Smoky Mountains NP                 02  Reconstruct trails............           SE         969,610  
      Eisenhower NHS                           01  Fire protection for historic             NE         975,438  
                                                    structures.                                                 
      Natchez NHP6                            106  Restore William Johnson and              SE         590,247  
                                                    rehabilitate McCallum Houses.                               
      John Muir NHS                           186  Relocate maintenance building.           PW       1,158,227  
      Glen Canyon NRA                         429  Improve Lake Powell water                IM       1,020,288  
                                                    quality.                                                    
      Historic Preservation                    01  Historic Preservation Training         WASO         847,570  
       Trainin                                      Center rehabilitation.                                      
      Boston African-American                 102  Rehabilitate African Meeting             NE       1,224,850  
       NHS                                          House.                                                      
      Minute Man NHP                          170  Complete Battle Road Trail....           NE       1,175,175  
      Glen Canyon NRA                         234  Enhance water quality and                IM       1,020,071  
                                                    recreation.                                                 
      Grant-Kohrs Ranch NHS                   162  Construct collections storage            IM         860,029  
                                                    facilities.                                                 
      Mammoth Cave NP                         187  Mitigate pollution of cave               SE       1,119,295  
                                                    from parking lot runoff.                                    
      Antietam NB5                            315  Stabilize and restore Antietam           NC       1,532,700  
                                                    Battleground structures.                                    
      Edison NHS16                            170  Preserve historic buildings              NE       2,804,207  
                                                    and collections.                                            
      Adams NHSS17                            108  Repair/rehabilitate Adams                NE       1,735,750  
                                                    Carriage House.                                             
      Minute Man NHP                         170A  Save historic structures and             NE       2,625,611  
                                                    cultural landscape.                                         
      Independence NHP                        417  Rehabilitate Bishop White                NE         854,222  
                                                    House utilities.                                            
      Sitka NHPS20                            101  Rehabilitate historic Priest's           AK       1,121,360  
                                                    Quarters and Old School House.                              
      Assateague Island NS                     01  Sustainable bathhouses........           NE       1,038,830  
      Crater Lake NP                          274  Rehabilitate Rim Village                 PW       1,845,790  
                                                    historic structures and                                     
                                                    landscape.                                                  
      Shiloh NMP23                            128  Halt loss of prehistoric earth           SE       1,460,650  
                                                    mounds.                                                     
      Maggie Walker NHS                       116  Stabilize/restore historic               NE       1,916,457  
                                                    resources.                                                  
      Jimmy Carter NHS                         01  Restore boyhood farm of Jimmy            SE       1,301,844  
                                                    Carter.                                                     
      Kaloko-Honokohau NHP                    157  Construct entrance/parking,              PW       1,634,880  
                                                    utilities, trails.                                          
      Wind Cave NP                            149  Rehabilitate leaking utility             MW       1,965,000  
                                                    lines to protect cave.                                      
      Salem Maritime NHS                      203  Rehabilitate seawall and                 NE         772,900  
                                                    moorings for accessibility.                                 
      Morristown NHP                          324  Rehabilitate historic park               NE       1,694,608  
                                                    buildings.                                                  
      Florissant Fossil Beds NM               145  Construct stump shelters to              IM       1,206,510  
                                                    protect fossil resource.                                    
      Denali NP and PRES                      105  Construct fire-emergency                 AK       1,616,540  
                                                    services building and                                       
                                                    headqtrs.                                                   
      Ulysses S. Grant NHS                   100A  Restore historic structures              MW       3,421,720  
                                                    and provide visitor                                         
                                                    facilities, Ph. I.                                          
      Weir Farm NHS                           102  Rehabilitate Burlingham                  NE       1,323,100  
                                                    Complex.                                                    
      Fort Point NHS                          393  Repair earthquake damage and             PW       2,136,679  
                                                    repoint brickwork.                                          
      Upper Deleware S&RR                     110  Complete site development--              NE         901,280  
                                                    Delaware Aqueduct.                                          
      Independence NHP                        414  Rehabilitate East Wing and               NE       1,203,024  
                                                    West Wing exhibits.                                         
      Hopewell Furnace NHS                    195  Stabilization of Anthracite              NE         909,140  
                                                    Furnace.                                                    
      Lowell NHP38                            117  Complete Boott Mill...........           NE         957,822  
      Colonial NHP                            402  Protect collections...........           NE       1,768,500  
      Cape Cod NS0                            104  Health, access Salt Pond                 NE       2,836,150  
                                                    Visitor Center.                                             
      Golden Gate NRA                         348  Repair balconies on Alcatraz             PW       1,180,036  
                                                    historic barracks.                                          
      Haleakala NP                            223  Replace comfort station and              PW       3,240,940  
                                                    wastewater system.                                          
      Delaware Water Gap NRA                   04  Rehabilitate Dingman Falls               NE       2,139,626  
                                                    site.                                                       
      Allegheny Portage NHS                   225  Staple Bend Tunnel                       NE       3,027,410  
                                                    stabilization/development.                                  
      Fort McHenry NM and                      01  Complete historic seawall                NE       2,210,358  
       Shrine                                       repairs.                                                    
      President's Park                        473  Eliminate environmental                  NC         648,673  
                                                    hazard, WhiteHouse greenhouse.                              
      George Washington MEM                   181  Theodore Roosevelt Memorial              NC       1,764,570  
       PKWY                                         restoration.                                                
      Katmai NP and PRES                      102  Lake camp development.........           AK       1,726,270  
      Lake Mead NRA                           069  Upgrade water treatment at               PW       3,094,500  
                                                    Katherine to comply with law.                               
      Gettysburg NMP                           02  Repair 22 historic monuments..           NE       2,011,868  
      Rock Creek Park                         227  Restore historic Pierce Mill             NC       1,223,064  
                                                    and Waterwheel.                                             
      Booker T. Washington NM                  01  Rehabilitate visitor center...           NE       1,478,990  
      Gettysburg NMP                           01  Protect historic structures...           NE       2,492,223  
      Fredericksburg and                      107  Stabilize historic ruins and             NE       2,070,367  
       Spotsylvania                                 resources.                                                  
      Cape Hatteras NS                        301  Construct a protective groin..           SE       2,020,712  
      Petroglyph NM                            01  Visitor center rehabilitation            IM       1,156,141  
                                                    and expansion.                                              
      New River Gorge NR                      154  Visitor facilities--Middle               NE       1,841,965  
                                                    Gorge.                                                      
      Hampton NHS8                            001  Reroof mansion and farmhouse..           NE       1,572,000  
      Petrified Forest NP                     109  Rehabilitate Painted Desert              IM       2,850,512  
                                                    Inn and Cabins.                                             
      Fort Scott NHS                          227  Provide fire protection for              MW       1,140,846  
                                                    historic structures.                                        
      Colonial NHP                            400  Connect Jamestown water system           NE         958,920  
      Chirichua NM                            241  Upgrade utilities,                       IM       1,201,270  
                                                    headquarters/campground.                                    
      Gateway NRA3                            220  Rehabilitate Ft. Tompkins at             NE       2,800,818  
                                                    Ft. Wadsworth.                                              
      Delaware Water Gap NRA                   01  Rehabilitate recreation site..           NE       2,689,430  
      Wupatki NM65                            101  Rehabilitate maintenance area--          IM       1,700,380  
                                                    Sunset Crater Volcano.                                      
      Acadia NPS66                            320  Rehabilitate historic Carriage           NE       3,007,760  
                                                    Road bridges.                                               
      Mount Rainier NP                        399  Complete repair of Jackson               PW         994,602  
                                                    visitor center roof.                                        
      Pecos NHSS68                            160  Correct/rehabilitate Ranch               IM       1,989,321  
                                                    Unit buildings.                                             
      Padre Island NS                         215  Construct sewage treatment               IM       1,046,235  
                                                    facilities.                                                 
      Kenai Fjords NP                         110  Improve access and visitor               AK       2,849,888  
                                                    facilities, Exit Glacier.                                   
      San Antonio Missions NHP                190  Improve health, safety,                  IM       3,111,250  
                                                    visitor services--San Jose                                  
                                                    Mission.                                                    
      Manassas NBP                            155  Preserve historic resources              NC       1,388,558  
                                                    parkwide--stabilize and                                     
                                                    restore.                                                    
      Mississippi NR and RA                   110  Develop partnership education            MW       2,563,690  
                                                    facilities in Science Museum.                               
      Fire Island NS                           01  Sustainable Student Discovery            NE       2,841,086  
                                                    Camp.                                                       
      Eisenhower NHS                           02  Rehabilitate historic barns...           NE       2,725,826  
      Statue of Liberty NM                     02  Complete historic seawall                NE       2,943,570  
                                                    rehabilitation.                                             
      Wupatki NM77                            192  Rehabilitate sewer lagoons....           IM       2,221,760  
      Cape Cod NS8                            226  Replace beach facilities......           NE       2,913,440  
      Carlsbad Caverns NP                     198  Rehabilitate highspeed                   IM       2,063,250  
                                                    elevators and shaft.                                        
      Grand Portage NHS                       106  Remove housing and mtnce.                MW       3,239,500  
                                                    activities from hist.                                       
                                                    resources.                                                  
      Catoctin Mountain Park                  989  Replace failing electrical               NC         721,810  
                                                    system at Catoctin Mtn. Park.                               
      Saint-Guadens NHS                       121  Improve sanitary and visitor             NE       2,166,740  
                                                    facilities.                                                 
      Martin Van Buren NHS                    101  Construct visitor restrooms              NE       2,210,358  
                                                    and park staff facilities.                                  
      Denali NP& PRES                         120  Rehabilitate Entrance Area               AK       3,407,310  
                                                    utilities, water and sewer.                                 
      Bryce Canyon NP                         103  Reconstruct North and Sunset             IM       1,703,000  
                                                    Campgrounds.                                                
      Fredericksburg and                      106  Protect park boundary.........           NE         798,381  
       Spotsylvania                                                                                             
      North Cascades NP                       107  Repair/stabilize Golden West             PW       2,485,916  
                                                    visitor center--adaptive use.                               
      Gateway NRA8                            219  Rehabilitate Battery Weed                NE       3,278,697  
                                                    seawall and dock.                                           
      Denali NP and PRES                    100RC  Rehabilitate Entrance Area               AK       2,416,950  
                                                    utilities, electrical.                                      
      Katmai NP and PRES                      103  Maintenance and curation                 AK       3,333,950  
                                                    building.                                                   
      Montezuma Castle NM                     100  Develop Montezuma Well                   IM       2,936,829  
                                                    infrastructure and facilities.                              
      Pictured Rocks NL                       168  Construct administration and             MW       3,792,922  
                                                    public use facility.                                        
      Tonto NM S93                            138  Construct visitor center                 IM       1,065,030  
                                                    restrooms and wastewater                                    
                                                    treatment.                                                  
      Hovenweep NM                            134  Build visitor center/ranger              IM       3,669,310  
                                                    station and support                                         
                                                    facilities.                                                 
      Vicksburg NMP                           300  Replace Cairo exhibit roof....           SE       1,945,397  
      Chickamauga-Chattanooga                 102  Improve park roads and provide           SE       2,209,970  
       NMP                                          public restrooms.                                           
      Delaware Water Gap NRA                   02  Sustainable comfort stations..           NE       2,042,370  
      Hampton NHS8                             02  Construct restrooms and                  NE       1,082,060  
                                                    connect sewer.                                              
      Big Bend NP9                            274  Redesign and rehabilitate                IM       3,168,890  
                                                    deteriorated campground.                                    
      Big Bend NP0                            132  Rehabilitate/expand failing              IM       3,183,300  
                                                    water system.                                               
      Harpers Ferry Center                    172  Accessibility modifications-           WASO       1,620,470  
                                                    HFC/IDC elevator.                                           
      Big Cypress NPRES                        02  Additional lands operations              SE       1,721,340  
                                                    facility.                                                   
      Big Bend NP3                            278  Rehabilitate and expand sewage           IM       3,227,840  
                                                    treatment.                                                  
                                                                                               -----------------
            Subtotal, small           ...........  ..............................  ...........     195,445,548  
             projects                                                                                           
                                                                                               -----------------
                                          Medium projects--$4 to $10 million                                    
                                                                                                                
          Glacier Bay NP&PRES                 104  Upgrade utilities.............           AK       5,278,335  
          Fort Smith NHS                      200  Rehabilitate historic                    MW       4,075,257  
                                                    courthouse/jail for visitor/                                
                                                    admin. use.                                                 
          Acadia NP                           232  Upgrade utilities and                    NE       5,257,030  
                                                    restrooms, Ph. I.                                           
          Castillo de San                     116  Stabilize Castillo de San                SE       4,279,770  
           Marcos NM                                Marcos National Monument.                                   
          Shenandoah NP                       455  Upgrade utility systems.......           NE       4,953,110  
          Gateway NRA                         169  Rehabilitate utilities at                NE       5,690,492  
                                                    Floyd Bennett Field.                                        
          Sitlka NHP                          106  Rehabilitate visitor center              AK       4,076,720  
                                                    and curatorial buildings.                                   
          Zion NP8                            226  Complete visitor                         IM       9,097,950  
                                                    transportation system.                                      
          Lake Mead NRA                        01  Upgrade water treatment to               PW       8,546,716  
                                                    comply with the law.                                        
          Hot Springs NP                      145  Abate lead-based paint in                MW       4,709,450  
                                                    historic structures.                                        
          Stephen T. Mather                    01  Mather Training Center                 WASO       4,461,860  
           Training Ce                              rehabilitation.                                             
          Bryce Canyon NP                     125  Rehabilitate visitor and                 IM       4,381,950  
                                                    education center.                                           
          Big Cypress NPRES                    01  Scenic corridor visitor safety           SE       4,793,290  
                                                    hwy improvements.                                           
          Yellowstone NP                      854  Replace sewage plant--Old                IM       5,895,000  
                                                    Faithful.                                                   
          Ulyssess S. Grant NHS              100B  Restore historic structures              MW       7,531,190  
                                                    and provide visitor                                         
                                                    facilities, Ph. II.                                         
          Yellowstone NP                      855  Replace water and sewer                  IM       6,261,800  
                                                    system--Norris Junction.                                    
          Horace M. Albright                   01  Albright Training Center               WASO       6,240,840  
           Training C                               rehabilitation.                                             
          Mississippi NR&RA                   114  Construct Mississippi River              MW       4,280,726  
                                                    partnership education center.                               
          Mammoth Cave NP                     171  Renovate visitor center.......           SE       5,326,962  
          Glacier NP                          165  Replace failed headquarters              IM       9,494,224  
                                                    sewer and water systems.                                    
          Timpanogos Cave NM                  135  Reconstruct interagency                  IM       7,604,550  
                                                    visitor center complex.                                     
          Lake Meredith NRA                   210  Reconstruct, reconnect, and              IM       4,400,552  
                                                    repair water system.                                        
          Home of FDR NHS                     137  Rehabilitate/restore Franklin            NE       4,736,960  
                                                    Delano Roosevelt NHS.                                       
          Dinosaur NM                         204  Construct and supply                     IM       4,660,419  
                                                    curatorial facility.                                        
          Congaree Swamp NM                   101  Construct permanent facilities           SE       8,981,360  
          National Capital                    612  Anacostia operations facility--          NC       7,217,555  
           Parks-East                               full rehabilitation.                                        
          Timucuan Ecological $               128  Construct visitor facilities             SE       9,728,060  
           Histori                                  for new area.                                               
          Mount Rushmore NMEM                 182  Replace wastewater treatment             MW       8,988,788  
                                                    system.                                                     
                                                                                               -----------------
            Subtotal, medium          ...........  ..............................  ...........     170,950,915  
             projects                                                                                           
                                                                                               -----------------
                                          Large projects--$10 to $25 million                                    
                                                                                                                
          Brown v. Board of                   100  Rehabilitate Monroe School for           MW      11,031,510  
           Education N                              visitor and admin. uses.                                    
          Sequoia NP                          200  Restore Giant Forest and                 PW      25,241,080  
                                                    construct day-use facility.                                 
          Wrangell-St. Elias NP               117  Construct visitor center and             AK      14,074,640  
           and PRES                                 headquarters.                                               
          Kenai Fjords NP                     140  Build cooperative VC, HQ,                AK      11,542,410  
                                                    conference center, Seward.                                  
          National Capital                    758  Preservation of the Lincoln              NC      19,893,220  
           Parks-Centra                             and Jefferson Memorials.                                    
          Yosemite NP                         383  Improve Tuolumne water and               PW      10,486,550  
                                                    wastewater systems.                                         
          Grand Canyon NP                      01  Construct South Rim                      IM      21,956,221  
                                                    orientation.                                                
          National Capital                    448  Preservation and                         NC      21,536,819  
           Parks-Centra                             rehabilitation of the                                       
                                                    Washington Monument.                                        
          Yosemite NP                         504  Restore Yosemite Valley--                PW      24,452,460  
                                                    remove/consolidate facilities.                              
          Everglades NP                       191  Rehabilitate Flamingo water              SE      17,647,167  
                                                    and wastewater systems.                                     
          Fort Sumpter NM                     105  Construct tour boat facility --          SE      10,724,075  
                                                     Dockside II.                                               
          Sequoia NP                          130  Complete infrastructure for              PW      13,942,330  
                                                    Wuksachi Village.                                           
                                                                                               -----------------
            Subtotal, large           ...........  ..............................  ...........     202,528,482  
             projects                                                                                           
                                                                                               -----------------
            Total, line item          ...........  ..............................  ...........     568,924,946  
             construction                                                                                       
             program                                                                                            
----------------------------------------------------------------------------------------------------------------


                              SERVICEWIDE PRIORITIES--FEDERAL LANDS HIGHWAY PROGRAM                             
                                                                                                                
----------------------------------------------------------------------------------------------------------------
FLHP                                                                                                            
 PRI          Park           Package      Reg      Reg pri         Package title          Estimate     Objective
----------------------------------------------------------------------------------------------------------------
  30 ACADIA                     287        NAR         18  REHABILITATE TOUR LOOP        20,000,000          2  
                                                            ROAD AND BRIDGES.                                   
  52 ACADIA                     233        NAR         33  REPLACE PARK ENTRANCE          1,000,000          4  
                                                            ROAD.                                               
  51 AMISTAD                    180        SWR         28  RECONSTRUCT PARK ROADS..       2,000,000          3  
  48 ANTIETAM                   271        NCR         34  CONSTRUCT NEW TOUR ROADS       2,405,000          2  
  50 ASSATEAGUE                 231        MAR         53  RECONSTRUCT ROADS AND          6,500,000          3  
                                                            PARKING, MD & VA.                                   
  34 BADLANDS                   120        RMR         24  REHAB 30 MILES MAIN ROAD      15,700,000          3  
  11 BIG BEND                   223        SWR         10  RECOSTRUCT MAJOR PARK         18,400,000          3  
                                                            ROADS.                                              
  71 BIG THICKET                113        SWR         45  STABILIZE PARK ROADS....       1,600,000          3  
   6 BLUE RIDGE PARKWAY         503        SER          5  RESURFACE 25 MILES OF          5,000,000          3  
                                                            PARKWAY.                                            
  23 BOSTON                     154        NAR         14  IMPROVE CHARLESTOWN NAVY       4,150,000          1  
                                                            YARD ROADS.                                         
  28 BRYCE CANYON               106        RMR         18  RECONSTRUCT ROADS             21,000,000          3  
                                                            PARKWIDE.                                           
  40 CANYON DE CHELLY           169        SWR         25  REHAB PARK ROADS........       1,500,000          3  
  70 CAPE COD                   210  .........        NAR  REHAB PARK ROADS AND           2,626,000          3  
                                                            PARKING.                                            
  86 CARLSBAD CAVERNS           180        SWR         74  RESURFACE ENTRANCE ROAD          500,000          3  
                                                            AND PARKING.                                        
  46 CHICKAMAUGA AND            142        SER         19  RELOCATE U.S. HIGHWAY 27      19,700,000          3  
      CHATTANOOGA                                           IN GEORGIA.                                         
  63 CHICKAMAUGA AND            102        SER         27  IMPROVE PARK ROADS AND 2       5,062,000          3  
      CHATTANOOGA                                           BRIDGES.                                            
  20 CHICKASAW                  156        SWR         22  RECONSTRUCT LAKE               2,700,000          3  
                                                            DISTRICT ROADS.                                     
  27 COLONIAL                   251        MAR         28  REPAIR/REHAB COLONIAL         13,000,000          3  
                                                            PARKWAY.                                            
  99 COULEE DAM                 266        PNR         33  RESURFACE ROADS AND            1,700,000          1  
                                                            PARKING.                                            
  60 CRATER LAKE                235        PNR         23  RESURFACE ROAD-ANNIE           5,500,000          1  
                                                            SPRINGS TO WEST BDRY.                               
  80 CRATER LAKE                253        PNR         25  RESURFACE ROUTE 7/             1,400,000          1  
                                                            PINNACLES ROAD, 6.1                                 
                                                            MILES.                                              
  87 CRATER LAKE                256        PNR         26  RESURFACE ROAD, CLOUDCAP       3,900,000          1  
                                                            TO HEADQUARTERS.                                    
  77 DEATH VALLEY               283        WER         47  REHAB BADWATER ROAD AND       14,803,000          3  
                                                            SPUR ROADS.                                         
  16 DELAWARE WATER GAP         292        MAR         13  REHAB/REPAIR ROUTE 209        52,170,000          4  
                                                            (22MI) & 6 BRIDGES.                                 
  84 EDISON                     170  .........        NAR  REHAB VISITOR CENTER           1,500,000          3  
                                                            PARKING.                                            
  41 FEDERICKSBURG              230        MAR         36  REHAB PARK ROADS........       7,020,000          3  
   2 FOOTHILLS PARKWAY         109A        SER          8  CONSTRUCT PARKWAY LINK..      32,500,000          4  
  38 FOOTHILLS PARKWAY          109        SER         17  COMPLETE PARKWAY (33.5       135,400,000          4  
                                                            MILES).                                             
   1 GATEWAY                    185        NAR          5  REHABILITATE PARK ROADS.      25,000,000          1  
  58 GATEWAY              .........        111        NAR  REHAB SANDY HOOK MAIN          8,500,000          1  
                                                            ROAD.                                               
  91 GATEWAY                    115        NAR  .........  REHAB MILLER FIELD ROAD        4,238,000          3  
                                                            AND PARKING.                                        
   8 GEO WASHINGTON M           461        NCR          8  REHABILITATE TURKEY RUN        2,900,000          2  
      PKWY                                                  BRIDGE.                                             
  17 GEO WASHINGTON M           836        NCR         16  RECONSTRUCT SPOUT RUN          7,210,000          1  
      PKWY                                                  PARKWAY.                                            
  67 GEORGE WASHINGTON M        464        NCR         61  REHABILITATE MEMORIAL          2,500,000          3  
      PKWY                                                  AVENUE BRIDGE.                                      
  75 GEORGE WASHINGTON M        461        NCR         77  SPROUT RUN TO 123.......       5,800,000          1  
      PKWY                                                                                                      
  79 GEORGE WASHINGTON M        461        NCR         85  123 TO SPROUT RUN.......       5,800,000          1  
      PKWY                                                                                                      
  24 GETTYSBURG                 106        MAR         22  REHAB PARK ROADS........       8,253,000          3  
  10 GLACIER                    303        RMR         14  REHAB GOING TO THE SUN         9,000,000          3  
                                                            ROAD, 55 MILES.                                     
  65 GLACIER                    312        RMR         28  RESURFACE CAMAS ENTRANCE       3,000,000          3  
                                                            ROAD.                                               
   5 GRAND CANYON               110        WER         10  RECONSTRUCT SOUTH RIM         22,794,000          3  
                                                            ROADS.                                              
  55 GRAND CANYON               196        WER         34  RECONSTRUCT WEST RIM           6,157,000          1  
                                                            DRIVE.                                              
  73 GRAND CANYON               272        WER         44  REALIGN/REPAIR EAST RIM       11,266,000          3  
                                                            ROAD.                                               
  26 GRAND TETON                328        RMR         17  COMPLETE FINAL SURFACE,        9,000,000          3  
                                                            31.7 MILES.                                         
  15 GREAT SMOKY                319        SER         12  REPLACE FOUR BRIDGES....       2,800,000          3  
      MOUNTAINS                                                                                                 
  54 GREAT SMOKY                324        SER         25  REHAB ABRAMS,                  1,100,000          3  
      MOUNTAINS                                             GREENBRIER, BIG CREEK                               
                                                            RDS.                                                
  89 GUADALUPE MOUNTAINS        207        SWR         76  RESURFACE DOG CANYON             800,000          3  
                                                            ENTRANCE ROAD.                                      
  22 HERBERT HOOVER             162        MWR         24  REHABILITATE PARK ROADS.         800,000          3  
  96 HOME OF FDR/               138        NAR  .........  REHAB ROADS, BRIDGES,          6,140,000          3  
      VANDERBILT MANSION                                    AND PARKWAY.                                        
  33 JOSHUA TREE                173        WER         24  RECONSTRUCT UNSAFE            18,471,000          3  
                                                            ROADS, PARKING.                                     
   3 KATMAI                     100        AKR         10  RELOCATE BROOKS CAMP           2,356,000          2  
                                                            FAC, REPAIR VTTS ROAD.                              
  12 LAKE MEAD                  242        WER         12  SAFETY RECONSTRUCTION         24,890,000          1  
                                                            LAKESHORE ROAD.                                     
  36 LAKE MEAD                  457        WER         27  REHAB NORTH SHORE ROAD &      51,090,000          1  
                                                            CONNECT ACCESS.                                     
  66 LAKE MEREDITH              185        SWR         39  RECONSTRUCT ACCESS ROADS       5,900,000          3  
                                                            AND PARKING.                                        
  62 LASSEN VOLCANIC            101        WER         43  REPAIR MAIN PARK ROAD...      13,493,000          3  
  74 LAVA BEDS                  302        WER         46  RECONSTRUCT SOUTHEAST          5,895,000          3  
                                                            ENTRANCE ROAD.                                      
  94 LOWELL                     101        NAR          3  REHAB VISITOR CENTER             688,000          4  
                                                            PARKING.                                            
  81 LYNDON B. JOHNSON          193        SWR         47  REHAB PARK ROADS........       1,500,000          3  
  31 MESA VERDE                 278        RMR         20  CORRECT ENTRANCE ROAD          8,000,000          3  
                                                            FAILURE.                                            
 9.5 MINUTE MAN                 170        NAR  .........  REHABILITATE BATTLE ROAD       4,144,000          3  
  45 MORRISTOWN                 187        NAR         23  REHAB PARK TOUR ROADS...       5,381,000          3  
  14 MOUNT RAINIER             349A        PNR          9  REHAB HIGHWAY 410.......      10,000,000          1  
  37 MOUNT RAINIER             349B        PNR         22  REHAB HIGHWAY 123.......      25,000,000          1  
  97 MOUNT RAINIER              386        PNR         32  RECONSTRUCT BACKBONE           3,000,000          1  
                                                            RIDGE VIADUCT.                                      
   4 NATCHEZ TRACE              250        SER          4  RESURFACE VARIOUS              5,000,000          3  
      PARKWAY                                               SECTIONS OF PARKWAY.                                
  25 NATCHEZ TRACE              300        SER         11  CONSTRUCT PARKWAY.......      38,900,000          5  
      PARKWAY                                                                                                   
  69 NATCHEZ TRACE              238        SER         31  CONSTRUCT FOUR                 4,000,000          5  
      PARKWAY                                               OVERPASSES.                                         
  90 NAVAJO                     144        SWR         77  REHAB ENTRANCE AND               500,000          3  
                                                            CAMPGROUND ROADS.                                   
  35 NCP-CENTRAL                450        NCR         23  RECONSTRUCT EAST BASIN         2,600,000          1  
                                                            DRIVE.                                              
  61 NCP-CENTRAL                405        NCR         45  RECONSTRUCT IND./MAINE         3,500,000          3  
                                                            AVE, EASTBOUND.                                     
  64 NCP-CENTRAL               405B        NCR         53  RECONSTRUCT JEFFERSON          2,500,000          3  
                                                            DRIVE.                                              
  72 NCP-CENTRAL               405D        NCR         69  RECONSTRUCT LINCOLN MEM        3,500,000          1  
                                                            CIRCLE, APPROACHES.                                 
  83 NCP-CENTRAL               405C        NCR         93  RECONSTRUCT ROADS, EAST        4,400,000          3  
                                                            POTOMAC PARK.                                       
 103 NEZ PERCE                  159        PNR         36  REPLACE SPALDING ROADS         1,000,000          3  
                                                            AND PARKING.                                        
  18 NORTH CASCADES             404        PNR         12  REPLACE BRIDGES-NEWHALEM       6,000,000          1  
                                                            & HARLEQUIN.                                        
  92 NORTH CASCADES             343        PNR         28  RECONSTRUCT CASCADE              800,000          1  
                                                            RIVER ROAD.                                         
  95 NORTH CASCADES             344        PNR         29  REHAB STEHEKIN ROAD.....       2,000,000          1  
  68 OLYMPIC                    311        PNR         24  RECONSTRUC EAST BEACH/         4,700,000          1  
                                                            LOG CABIN ROADS.                                    
 101 OLYMPIC                    406        PNR         34  CONSTRUCT TWIN CREEK             650,000          2  
                                                            BRIDGE.                                             
 102 OLYMPIC                    407        PNR         35  REPLACE FINLEY CREEK           1,050,000          3  
                                                            BRIDGE.                                             
  42 OZARK                      506        MWR         32  REHAB PEAVINE ROAD......       3,300,000          3  
  76 PADRE ISLAND               200        SWR         46  REROUTE BIRD ISLAND              900,000          3  
                                                            BASIN ROAD.                                         
  59 PECOS                      137        SWR         31  REHAB ENTRANCE ROAD.....         500,000          3  
  57 PETERSBURG                 132        MAR         54  REHABILITATE MAIN PARK         2,000,000          3  
                                                            ROAD & BRIDGES.                                     
  47 RICHMOND                   129        MAR         38  REHAB PARK ROADS........       2,800,000          3  
  39 ROCK CREEK PARK            318        NCR         37  REHAB ROCK CREEK PARKWAY       4,140,000          1  
                                                            & ADJACENT TRAIL.                                   
  85 SALINAS PUEBLO             173        SWR         48  REHAB ENTRANCE ROAD.....         900,000          3  
      MISSIONS                                                                                                  
  93 SAN ANTONIO                185        SWR         83  REHAB PARKING AREAS.....         600,000          3  
      MISSIONS                                                                                                  
  29 SARATOGA                   159        NAR         17  REHABILITATE TOUR ROADS.       6,000,000          2  
  98 SARATOGA                   160        NAR  .........  REHAB ROADS AND PARKING.         439,000          3  
  13 SEQUOIA AND KINGS          840        WER         15  RECONSTRUCT GENERALS          47,160,000          3  
      CANYON                                                HIGHWAY.                                            
  82 SEQUOIA AND KINGS          336        WER         50  REPLACE CEDAR GROVE            3,930,000          3  
      CANYON                                                BRIDGE.                                             
  19 SHENANDOAH                 125        MAR         18  RECONSTRUCT SKYLINE           31,000,000          3  
                                                            DRIVE.                                              
  56 SHILOH                     138        SER         26  RESURFACE PARK TOUR            1,165,000          3  
                                                            ROADS.                                              
  53 THEODORE ROOSEVELT         164        RMR         26  RECONSTRUCT/RESURFACE          9,900,000          3  
                                                            PARK ROADS.                                         
   9 VICKSBURG                  131        SER         14  RESURFACE ALL BITUMINOUS-      2,355,000          1  
                                                            PAVED ROADS.                                        
 100 WEIR FARM                  102        NAR  .........  REHAB PARK ROADS AND             144,000          3  
                                                            PARKING.                                            
  32 WILSON'S CREEK             173        MWR         25  REHAB MAIN ENTRANCE ROAD         500,000          3  
  44 WUPATKI                    103        SWR         26  RECONSTRUCT MAIN LOOP          6,100,000          3  
                                                            ROAD.                                               
   7 YELLOWSTONE                254        RMR         12  RECONSTRUCT ROADS            227,000,000          3  
                                                            PARKWIDE.                                           
  21 YOSEMITE                   140        WER         22  RELOCATE SOUTH ENTRANCE       25,676,000          2  
                                                            ROAD/MARIPOSA.                                      
  43 YOSEMITE                   843        WER         28  RECONSTRUCT GLACIER           14,410,000          3  
                                                            POINT ROAD.                                         
  49 YOSEMITE                   505        WER         31  RECONSTRUCT EL PORTAL         26,593,000          1  
                                                            ROAD.                                               
  78 YOSEMITE                   565        WER         48  REHABILITATE WAWONA ROAD      27,772,000          3  
  88 YOSEMITE                   146        WER         51  RECONSTRUCT TIOGA ROAD..      45,850,000          3  
                                                                                    ----------------            
           SERVICEWIDE    .........  .........  .........  ........................   1,293,836,000  .........  
            TOTAL--FLHP                                                                                         
            PROGRAM                                                                                             
                                                                                                                
----------------------------------------------------------------------------------------------------------------
     Objective:                                                                                                 
                                                                                                                
     1 = Health and safety.                                                                                     
     2 = Resource protection.                                                                                   
     3 = Repair/rehabilitation of exiting facilities.                                                           
     4 = New facilities in a new/developing park.                                                               
     5 = Additional facilities in an older/established park.                                                    

                              park housing

    Senator Burns. One thing that was of concern, I noticed an 
article in the paper that came out--and you might address 
this--that they are building some new homes for employees in 
Yellowstone Park, of which there is a 1,600 square foot home at 
a cost of around $300,000. Could you tell me what would inflate 
the construction of a home, especially in view of the fact that 
there is no land cost involved in that?
    Secretary Babbitt. Senator, I would be happy to give you 
the facts and figures on that. I am not familiar with the 
specific issue, but it is a fair question, and I will be happy 
to give you a response.
    [The information follows:]

                Yellowstone National Park Housing Costs

    Yellowstone National Park has not and does not plan to 
build any 1,600 square foot homes that cost $300,000. This 
derived figure was an estimate provided by an outside 
contractor for an analysis in which Yellowstone managers were 
deliberately conservative. As such, Yellowstone managers feel 
that these numbers represent a ``worst case scenario,'' and 
that there are several initiatives underway that may 
significantly reduce these costs.
    Notwithstanding these facts, there are several expenses 
that are included in the construction of a home in Yellowstone 
National Park that are frequently overlooked when comparing to 
the cost of a home on the commercial market. Circumstances 
related to the following components impact the final cost:
    Planning and design.--The planning for and design of houses 
in Yellowstone National Park is more complicated than that of 
houses in developed communities. The issues that must be 
addressed during this initial phase range from impacts on 
cultural and natural resources to ensuring adequate 
accessibility to minimizing the visual impact of homes on 
landscapes. This planning often requires time-consuming 
consultation with State Historic Preservation Offices, 
particularly when historic areas will be impacted.
    Frequently, the costs associated with county planning and 
designers in non-park houses are recovered by taxes and impact 
fees and thus not included in the ``price'' of a house. 
Yellowstone includes the costs of these components when 
identifying the price of a structure.
    Basic construction.--Basic construction costs are more 
expensive in many national parks than in surrounding 
communities. The short construction season, transportation of 
material and employees, and the lack of adequate contractor 
housing all inflate these costs. By way of example, concrete 
delivered to the Old Faithful area in Yellowstone National Park 
costs $105 per cubic yard. The same concrete delivered in 
nearby Bozeman, Montana, is $65 per cubic yard.
    Construction equipment entering the park is pressure washed 
to prevent the spread of noxious weeds. New housing must also 
withstand snow weighing as much as 150 pounds/square foot and 
is designed to withstand zone four earthquakes (the same 
seismic zone as San Francisco). These stringent requirements, 
which must be applied to homes for Federal employees, are not 
necessarily applied to the ``comparable'' homes outside of the 
park.
    Utility systems.--Housing that can use existing utility 
systems is considerably cheaper than housing for which 
utilities must be provided. In many cases utilities are already 
in place in non-park municipalities.
    Landscaping/revegetation.--Unlike many non-park homes, the 
Yellowstone housing costs also include the revegetation 
necessary to prevent erosion and minimize the visual impact on 
the surrounding landscape.
    In the case of any of these cost drivers, there are 
significant economies of scale when constructing multiple 
houses. Unfortunately, housing money is typically allocated to 
Yellowstone incrementally. As a result, ``overhead'' must be 
factored into each discrete project and park managers cannot 
take advantage of these economies.

                            three-state area

    Senator Burns. We are building in a three-State area, 
probably, within that Park that would cost less than one-third 
of the figure that was given on that. And I would like to know 
what circumstances or elements figure in the cost of those 
homes that would drive that cost that high.
    Secretary Babbitt. I would be pleased to respond in 
writing.

                   park infrastructure priority list

    Senator Burns. And if you could respond to me on the 
backlog of your infrastructure needs on the Park Service, and 
where the--and I would like to have your priority list on where 
we should be concentrating our efforts. I think it behooves all 
of us. I know ours is just a parochial thing, because Glacier 
and Yellowstone affect us, but I know we have infrastructure in 
other parts of the country that would be also high on your 
list, too.
    Secretary Babbitt. Senator, I have just one specific 
observation relative to Glacier, and certainly to Yellowstone, 
where the road issue is really critical. I suspect that 
Yellowstone currently has a larger backlog of road construction 
and maintenance than any other two or three parks put 
together--certainly in the lower 48 at least. I would hope that 
we could, together, be looking at the ISTEA reauthorization, at 
all of the Federal road programs, and just examine what is a 
fair allocation, fair earmarking, from Federal highway programs 
to at least assist with some part of this.

                    yellowstone national park--roads

    Senator Burns. Well, I think that is a good suggestion. But 
you know we allocate or we budget so much, and I cannot see 
that anything has been done for the roads in Yellowstone Park 
at all. I cannot see anything that is improving that road 
situation. And of course, it is a park that has quite a lot of 
traffic, and the pressure is intense. So if I could get some 
kind of a report. And I would be happy to work with you in the 
allocation of those infrastructure things.

                           yellowstone--bison

    As far as the bison thing, you know I have talked about the 
bison thing 100 times. You knew it was going to come up today. 
And I am going to beat up on it. But I have beat up on you on 
that because--have you read this letter, the April 24 letter 
that was written to John Tarburton, the President of the 
National Association of State Departments of Agriculture, from 
the White House?
    Secretary Babbitt. Senator, I am not certain. I do not 
think so.
    Senator Burns. I think that the White House was--and I 
would like to put this in the record, Mr. Chairman, if I could. 
It was a response, I think, to Mr. Tarburton with regard to 
animal health and the impact that we might have on certain 
statuses of parks and the wildlife that is contained in those 
parks.
    Senator Gorton. The letter will be included in the record.
    [The letter follows:]
                   Letter From President Bill Clinton
                                           The White House,
                                    Washington, DC, April 24, 1997.
Mr. John F. Tarburton,
President, National Association of State Departments of Agriculture,
Washington, DC.
    Dear John: Thank you for your letter regarding the management of 
bison in Yellowstone National Park. I understand your concerns.
    On March 19, 1997, the National Park Service, the U.S. Forest 
Service, and the Animal and Plant Health Inspection Service met with 
representatives of the State of Montana to continue development of a 
long-range bison management plan. A number of alternatives are being 
considered, with the understanding that any viable alternative must, 
among other things, address bison population size and distribution; 
clearly define a boundary line beyond which bison will not be 
tolerated; address the risk that bison pose to public safety and 
private property; protect livestock from the risk of brucellosis; 
protect the state of Montana from any risk to its brucellosis-free 
status; and commit to the eradication of brucellosis from bison and 
other wildlife.
    I hope this adequately addresses your concerns. Thanks again for 
writing.
            Sincerely,
                                                      Bill Clinton.

                         bison management plan

    Senator Burns. It says:

    On March 19, the National Park Service, the United States 
Forest Service and the Animal Plant and Health Inspection 
Service met with representatives of the State of Montana to 
continue development of the long-range bison management plan. A 
number of alternatives are being considered, with the 
understanding that any viable alternative must, among other 
things, address the bison population size and distribution, 
clearly define a boundary line between which bison will not be 
tolerated, address the risk that bison pose to public safety 
and private property, protect livestock from the risk of 
brucellosis, protect the State of Montana from any risk to its 
brucellosis-free status, and commit to the eradication of 
brucellosis from bison and other wildlife.
    I hope this adequately addresses your concerns, and thanks 
again.

    And it is signed by the President.
    This letter would indicate that you are at odds, then, with 
your present policy; you are at odds with the White House. Is 
that not a correct assumption?
    Secretary Babbitt. I do not think that is likely. It is a 
large organization. Whoever wrote that letter probably did not 
talk with me. I certainly do not remember it. I suspect that 
any differences in nuance or language is because it may have 
been written by 1 of the 20-somethings in the White House 
correspondence unit. It is entirely possible.
    Senator Burns. It has been suggested by your friends that 
the national regulation plan you have for parks, some of those 
plans are not working. With this in mind, can you explain to 
the committee how and why we continue to put forth a failed 
policy of natural regulation of wildlife in Yellowstone Park?
    Secretary Babbitt. Well, I do not consider it a failed 
policy. We could discuss that today or elsewhere. I think it is 
indeed a well considered and productive and successful policy.
    Senator Burns. 1,400 bison will starve to death this 
winter. Is that the policy?
    Secretary Babbitt. Well, I do not know of any policy in 
this administration or elsewhere which is directed at making 
sure that animals do not starve.
    Senator Burns. Well, I guess that is the difference in the 
way we look at things, is it not?
    Secretary Babbitt. No; I think our differences, frankly, go 
much beyond that. For example, I am on the record as being 
adamantly opposed to the continuing slaughter of these animals.
    Senator Burns. Mr. Secretary, we are not talking about 
slaughter of animals. We are talking about a park service that 
has allowed 1,400 bison to starve to death. That was not done 
by anybody.
    Secretary Babbitt. Well, Senator, the plain fact is that 
several thousand animals were slaughtered by the State of 
Montana, and we are opposed to that.
    Senator Burns. The slaughter has been inside that park.
    Secretary Babbitt. Well, the 2,000 I am talking about----
    Senator Burns. And that figure outside the park does not 
even approach that figure.
    Secretary Babbitt. Well, it does.
    Senator Burns. It does not even approach it. And I am 
wondering what we are going to do inside the park to prevent 
this.
    Secretary Babbitt. Well, Senator, we obviously----
    Senator Burns. We could prevent all of this.
    Secretary Babbitt. We obviously differ. Your position is 
that the animals should not be allowed outside the park. I 
disagree with that. The land outside the park is public land. I 
believe the people of the United States support the notion that 
these animals should be, under the circumstances, allowed on 
public land, owned by the people of the United States. And, 
that we should terminate this policy of slaughtering them when 
they walk across an artificial line, separating Yellowstone 
National Park from the adjoining national forest.
    Senator Burns. Does not the park belong to the people, too?
    Secretary Babbitt. Absolutely.
    Senator Burns. You are not going to take any responsibility 
for that?

                         bison on federal land

    Secretary Babbitt. Senator, those animals would not be 
starving in the park if we had a rational policy which would 
allow them to seek forage in the lower elevations on Federal 
land adjacent to the park. Of course, we should find a better 
balance for this bison herd. But we cannot do that as long as 
you insist that those animals should be left in the high 
altitudes rather than being allowed, in the right 
circumstances, off the boundary of the park, onto adjoining 
public lands, where, in my judgment, they have every right to 
be.
    That would prevent the starvation. But it is not possible 
because the State of Montana is slaughtering those animals as 
they move down into the lower elevations. And we disagree on 
that policy.
    Senator Burns. Is it not the responsibility of the Park 
Service to maintain some sort of range condition for winter 
forage?
    Secretary Babbitt. The plain fact is that these animals 
need more winter range. It is available on public land, except 
for the policies of the State of Montana.
    Senator Burns. I would say that the public lands that you 
are looking at for winter range is probably the same altitude 
as the park.
    Secretary Babbitt. Well, I disagree. That is not correct.
    Senator Burns. Well, you can look at your elevations and 
everything, but in other words, you are absolving the Park 
Service's responsibility to maintain range conditions that 
would sustain the number of bison that it can carry in there; 
is that not correct?
    Secretary Babbitt. Senator, Yellowstone National Park is 
high summer range land. Historically, animals have all migrated 
off that high land, down onto winter range. The elk do that. 
And it seems to me perfectly appropriate. That happens in every 
national park in the United States. Bison should be treated 
exactly the same way.
    Senator Burns. I would say that the forage outside of that 
park is probably primarily on private land. Would you conclude 
that?
    Secretary Babbitt. There are millions of acres of adjacent 
forest land which are appropriate winter range for wildlife 
owned by the people of the United States. That includes bison. 
This notion that they should be kept inside Yellowstone 
National Park, at high altitudes, during bad winters, at gun 
point, I think is a badly mistaken philosophy.
    Senator Burns. We, as private landowners and grazers and 
people in the livestock industry, are committed to keeping our 
animals on our land and maintaining range conditions that would 
sustain the number of animal units that we can properly take 
care of.
    Secretary Babbitt. Senator, I am not talking about private 
land. I am talking about public land, owned by the people of 
the United States of America.
    Senator Burns. What difference whether it is a public herd 
owned by the public or a private manager trying to maintain his 
own area? Should not the same practices--is the same good 
neighbor policy the same?
    Secretary Babbitt. Senator, a private landowner has every 
right to exclude bison from his or her private land. That is 
not what we are talking about. We are talking about a policy 
which says these animals will be slaughtered as they move onto 
lower altitudes onto national forest land. I believe that is 
mistaken, unnecessary, and wrong.

                         bison herd management

    Senator Burns. I would support the idea that the numbers 
cut back can be shipped to any other part of the country, if we 
can clean up this idea of a disease. We have no problem with 
that, Mr. Secretary. No problem at all.
    Secretary Babbitt. Senator I believe the present policy is 
fundamentally wrong.
    Senator Burns. What I am saying is that to be a good 
neighbor, I mean, to abide by some rules and regulations that 
were written naturally many, many years ago, that we could 
accomplish that then. We cannot do it without the cooperation 
of the Park Service.
    Secretary Babbitt. Senator, I cannot be a party to a policy 
which says bison in search of winter range are going to be 
slaughtered when they cross from Yellowstone National Park into 
the adjoining national forest. I do not support that policy.
    Senator Burns. Then what I would suggest is that we manage 
the herd in the park to where we have sustained forage and 
sustained range, and work with the States in order to manage 
the herd and clean up a diseased herd, and take care of those 
things and we will be able to do that.
    Secretary Babbitt. Senator, you are not advocating that for 
elk.
    Senator Burns. But elk have different social habits. You do 
not have near the problem with elk.
    Secretary Babbitt. They have a social habit shared by 
bison, and that is that they are wildlife owned by the people 
of the United States, which ought to be managed on a public 
land base, including the U.S. National Forest System.
    Senator Burns. But the fact is the winter herds of elk, the 
vast majority of them, winter on private property. And they 
graze on private property. Very happily so. We have very few 
problems. And you know the social problems that we are talking 
about. Elk do not have the same cycles as buffalo do, or bison 
do.
    There is a lot of this that maybe the American people do 
not understand, but do not use the inflammatory words of 
Montana slaughtering those animals, when you, the Park Service, 
allowed this abominable management of a herd to starve to death 
when you had it in your power to control the numbers and 
provide the forage and the management. And you have the 
technique. You have it.
    And I understand that maybe we need to do some ongoing 
research. Maybe you can supply me with the amount of research 
that the Park Service is doing. I will be happy to take that--
but in recommended management problems. Now, that is the fact. 
That is the fact that the Park Service policy starved these 
animals. And you can use all the inflammatory language that you 
like, all of that; we are going to continue to protect not only 
the integrity of that herd, but the integrity of an industry in 
my State, and we will continue to do that.
    But as long as the Park Service embraces this policy, then 
they must shoulder the concerns of that policy and not try to 
push it off and blame somebody else. That is it. And I thank 
you for coming this morning.

                             new world mine

    I want to ask you some questions about the land and 
conservation with the gold crown situation up there. That was 
not the deal that was made by the people of Montana on private 
property, using money to buy out a mine that we use to help the 
environment of this country, using environmental funds to help 
the environment in this country, and to allow this. Are you 
going to complete the EIS so that it tells us that maybe that 
area should be mined or not mined?
    Secretary Babbitt. Senator, the EIS issue really turns, I 
think, on the acquisition issue.
    Senator Burns. But you are not acquiring the land.
    Secretary Babbitt. Well, we have not acquired the land.
    Senator Burns. What?
    Secretary Babbitt. We have not acquired, that is correct.
    Senator Burns. That is exactly right.
    Secretary Babbitt. That is correct.
    Senator Burns. It is private property. Well, I will have 
some more things in writing, but we can discuss these in calmer 
environs. But I do not like the idea of being blamed for some 
things. It is because of policy set by the Park Service that is 
creating this whole situation.
    So, thank you.

                          bison herd integrity

    Secretary Babbitt. Senator, I appreciate the spirit of your 
questions. I just want, again, to say that, with all respect, 
we have a fundamental disagreement. And I am ready and willing 
to sit down and discuss it at any time.
    Senator Burns. The disagreement is on the policy of how do 
we maintain the integrity of the herd and of the park.
    Secretary Babbitt. That is correct.
    Senator Burns. And to embrace management policies that have 
been a very, very successful policy all across this country 
with the exception of here. And that, I find, very intriguing.
    Senator Gorton. I did not realize, Mr. Secretary, when I 
said I would allow every other member of the subcommittee to 
question first that I would still be waiting somewhat more than 
2 hours later.
    Senator Burns. My apologies to the chairman.
    Senator Gorton. You were a very small part of it, Senator 
Burns.
    Senator Cochran, who was here, wanted me to mention that he 
will submit questions to you on the Natchez Trace and on other 
subjects, and will do so in writing.

                              alaska roads

    Senator Gorton. And I might say, with respect to the first 
set of questions by the Senator from Alaska, which I and I 
suspect other members of the committee, found somewhat 
frustrating on both sides of the table, Mr. Secretary, I can 
appreciate a policy of an administration that does not want 
roads on every section line for 960,000 miles. I do not regard 
that as an overwhelming threat. I must say, as an outsider, I 
regard it as equally irresponsible to say that no one is going 
to be able to build a road unless 1976 motor vehicles or 
something like it were being used.
    If you do not mind, I would ask you to come up and have a 
private conversation with me on a suggestion that might be able 
to get both sets out of it when the hearing is over. But I 
think you ought to also carry back to the administration the 
proposition that these veto threats, whether they relate to 
roads in Alaska and Utah or continuing resolutions, do not come 
free. There are many in the Senate who are operating right on 
the policy now that we are going to pass one flood supplemental 
bill and only one and that a veto is going to be a veto of the 
whole bill and not of a single element of it. That is obviously 
not a decision that has been taken finally, but there is a very 
real possibility that that will be the case.
    It is something I would regret. You know, we have worked on 
our part of it for the Department of the Interior in a way that 
I think is both responsible and generous. You spoke earlier of 
Yosemite. Obviously it is very important that the Yosemite 
provisions of that flood supplemental become law and not be 
hostage to debates on other issues. But I do have a number of 
questions of my own. I am obviously not going to be able to get 
through all of them, but let us at least start. And I hope that 
while we will have some disagreements, we can go through them 
once each, and I will express my views and you can express 
yours, and then we will go on to another subject.

                  interior columbia river basin study

    And I will start with a contentious and partly parochial 
one, the inner Columbia basin ecosystem study. The Senate 
Energy Committee had a hearing on that subject last Thursday. 
And we were faced, it seems to me, with at least the 
conflicting functions of a number of government agencies. The 
Bureau of Land Management and the Forest Service have missions 
that include, though obviously they are not limited to, a 
commodity production role. The Fish and Wildlife Service has no 
such function at all.
    And it seems to me at least that much of the cost of 
implementing the Columbia basin study, now estimated to be $125 
million more than present costs, is attributable to meeting the 
requirements of the Endangered Species Act as interpreted by 
standards developed by the Fish and Wildlife Service and other 
science agencies. In the hearing I learned that the 
environmental impact statement prepared by the Forest Service 
and the BLM was on its way to be printed when objections from 
the Fish and Wildlife Service, the National Marine Fisheries 
Service, and the Environmental Protection Agency, resulted in 
further delays.
    It seemed to me that rather than consultation, we were 
involved in a dictation on the part of those agencies, with 
certain tremendous impacts, most of them adverse, on local 
economies. My first question is: Why did the Fish and Wildlife 
Service, along with the EPA and the National Marine Fisheries 
Service, cause the delay in the release of the interior 
Columbia basin environmental impact statements?
    Secretary Babbitt. Well, that in fact happened. The reason 
is that the regulatory agencies are worrying about the 
implications of the so-called Pacific Rivers decision, which 
led us to think of these impact statements as something that 
ought to have the ability, from the front end, to address all 
regulatory consultations, which usually take place downstream, 
months or years later. These have been framed in a way that we 
anticipate the issues would all be cleared out of the way once 
the plan was implemented. Then local land managers could 
effectively go about their business without having to reconsult 
with the regulatory agencies on hundreds of projects across the 
years.
    Now, let me also say that when those objections were raised 
by the regulatory agencies, we went back to the process, 
including the local governments, and thrashed it out in a way 
that I think is fairly satisfactory. I mean the changes were 
all flagged and discussed. Many of them were resolved, 
withdrawn, and modified.
    Last, one sentence about the projected cost in the 
outyears, beginning in 1999. A big piece of those costs is the 
forest health issues, which are not, in most cases, being 
driven by the Endangered Species Act. The part that deals with 
stream restoration certainly is being driven by the Fish and 
Wildlife Service and National Marine Fisheries Service. But I 
would wager that much of the larger part of those costs is the 
thinning and prescription treatment and burning of forests.
    Senator Gorton. Are those regulatory agencies going to, in 
effect, have veto power over forest management practices in the 
region?
    Secretary Babbitt. Under the preferred option in the 
statements as option four--and I believe that the theory behind 
option four is that the front-end adoption effectively 
preclears most of the decisions by the land management 
agencies--there are two categories. There is one category of 
areas that requires an additional step of watershed analysis. 
But the lands which have the so-called default standards, I 
believe, by my understanding and reading of the document, is 
that the land management decisions would take place without any 
further consultation.
    Senator Gorton. Under the Northwest plan, the President's 
report stated that the time for consultation was reduced from 
114 to 30 days, obviously a significant efficiency. What needs 
to be done to assure this same level of efficiency in 
implementing the Columbia basin study and other large eco-
region projects?
    Secretary Babbitt. I think it is a factor of two things. 
One is the level of attention being given to this. The reason 
we reduced the number of days of consultations in my judgment, 
in the forest plan is because Tom Collier sat on these issues 
and simply did not let them escape his attention for even 1 day 
as we went through the process. The remaining question is 
whether that is now a cultural change that we can count on or 
whether we will have to stay with it in that kind of detail. 
Obviously some of it is a function of funding as well.

                       eco-regional plans funding

    Senator Gorton. Back to the $125 million cost. Should we 
expect similar increased costs for other large eco-regional 
plans when the preferred alternatives are selected? Or is this 
one going to be a special case?
    Secretary Babbitt. Senator, I would counsel some caution 
about that figure for these reasons. First of all, it is an 
estimate of the costs, that is out ahead of the EIS process, 
which you know might be incurred. And second, as I said, a 
great deal of that cost is forest restoration costs. The pace 
at which that takes place, I think, is subject to a lot more 
discussion. The bottom line is, when we are talking about the 
inland forests of the West, we have a forest ecosystem health 
problem that is acknowledged by all. And it is going to be 
expensive to fix it.
    The question is on what kind of time line do we move. Not 
to elaborate, but we have got probably 300 million acres of 
inland forest in the West. We are doing prescriptive treatment 
on maybe 2 million or 3 million acres a year right now.
    Senator Gorton. So this plan is not going to be unique. 
There are going to be similar problems with respect to all of 
the other large regional plans out there?
    Secretary Babbitt. This problem is a West-wide problem. It 
is, in most cases, not being driven by the Endangered Species 
Act. Those costs are not being forced by regulatory agencies. 
They are being estimated, at least 50 percent and I would guess 
probably closer to 75 percent, of those costs are being driven 
by the forest managers as necessary management, quite apart 
from regulatory requirements.
    Senator Gorton. To the extent that you are responsible for 
it in BLM, will your 1999 budget request reflect those costs?
    Secretary Babbitt. My 1999 budget?
    Senator Gorton. 1999.
    Secretary Babbitt. Senator, I am not prepared to say 
because I have not seen these figures scrubbed down. In the EIS 
process we are going to need an expansive debate about not the 
stream-specific pieces, which are I think mandated, but about 
the pace of and cost and alternatives of dealing with these 
forest issues.

                               everglades

    Senator Gorton. Another subject, the Everglades. Tell me 
the overall status of the Everglades restoration effort. We are 
pretty close. It looks to me like $1 billion in a 2-year 
period, when you combine both the State of Florida's 
contribution and our own. How is it going? How are the agencies 
working together?
    Secretary Babbitt. I think we are pretty much on track. 
There are, I think, two or three major pieces that are 
unfolding right now. The restoration work in Taylor Slew, the 
so-called modified water delivery, is critically important, 
because it rewaters the southeastern portion of the Everglades. 
The Corps of Engineers restudy is on track. That is, we have 
made a big commitment there to a final plan by 1999. It is 
moving essentially on track.
    The third really big piece is the storm water treatment 
areas up at the top end, where the runoff from the sugar fields 
is being cycled through these retention areas for natural 
uptake of the phosphorous. The first large-scale treatment 
center is now under construction--at least, if they are not 
turning earth, they will be in the next few weeks. That one 
dropped a tiny bit behind schedule because of some cash flow 
issues in the South Florida Water Management District. But they 
are resolved and ground breaking is under way.
    There are still some remaining issues on the Corps of 
Engineers' 404 water quality permit up there. I think they are 
being worked out. We are going through the process of 
disbursing the money that was in the farm bill last year. I 
think we have a very satisfactory consensus plan, and that 
money will be disbursed probably by the end of the summer.

                           budget priorities

    Senator Gorton. Now, I have got a fairly complicated 
paragraph here on the budget and the way we set our priorities, 
so try to listen to me and stop me if I need to go over it 
again for you. The budget agreement, which looks like it is 
going to be implemented now, provides about a 2-percent 
increase in discretionary, nondefense spending in fiscal year 
1998. That, if we go a pro rata share, would probably be about 
$240 million for this subcommittee. But function 300 natural 
resources, that makes up a large portion of our bill, seems to 
be more generously treated, and we could conceivably get up to 
a 4.5-percent increase, or $560 million. But not everything is 
in that function.
    So let us start with the figure of $500 million more than 
the current appropriations level. The Park Service priorities 
that are in the budget agreement as priority items are $83 
million of that; for tribal priority allocations--Senator 
Domenici talked to you about that--another $77 million; 
Everglades, $79 million. If we stop selling oil from the 
strategic petroleum reserve to finance programs in the Interior 
bill, and I think it would be responsible to take that action, 
that is another $200 million.
    Now, that leaves about $61 million out of that $500 million 
for everything else, including other Interior agencies, the 
Indian Health Service, energy conservation and so on. So most 
of it is eaten up by these priority matters first. Have you 
considered the impact on other agencies that absolute 
protection of these priority programs within a balanced budget 
might have?
    Secretary Babbitt. Senator, I have been a little hesitant 
to look across the chart for fear of retribution from other 
agencies. But I understand the import of your question. I would 
be happy to engage in the kind of dialog that I think we had 
very successfully last year. I recall that you asked me last 
year almost an identical question.
    Senator Gorton. It was tougher last year. We were going 
down, if anything.
    Secretary Babbitt. I have reason to suspect that if we 
engage in detail and do this carefully, we can pick our way 
through it. But I understand the question. What you are saying 
is we are not home free.
    Senator Gorton. That is right.
    Secretary Babbitt. And I accept and understand that.

                        land acquisition funding

    Senator Gorton. Now, on an allied subject, land 
acquisition. The budget agreement provides for the expenditure 
for another $700 million for land acquisition over the course 
of the next 4 years, with $300 million to be available for 
1998. Though it is not stated explicitly in the budget 
agreements, the intent seems to be to provide the $315 million 
in 1998 and $15 million in 1999; for the headwaters forests, 
$250 million; and the New World Mine, $65 million; and to 
provide an additional $385 million for other acquisitions in 
1999, 2000, and 2001. At least that is our reading here.
    Do you agree with that reading?
    Secretary Babbitt. Senator, that is essentially my reading. 
I would not want to be held to the pace of outlays, but as you 
describe the New World Mine, the headwaters, and the remaining 
balance essentially unencumbered beyond that, that is my 
understanding.
    Senator Gorton. Now, that is a pretty dramatic increase. 
Can you efficiently manage that kind of increase, and are there 
enough--other than the two I named, are there enough quality 
acquisitions in the pipeline to justify it?
    Secretary Babbitt. Senator, yes; the backlog of acquisition 
proposals is reflected each and every year in the budget 
process. And the answer is there are plenty of them.
    Senator Gorton. Yes; there are plenty of them and yes you 
could manage them, both?
    Secretary Babbitt. Yes.
    Senator Gorton. OK. Why has the administration decided not 
to finance the headwaters acquisition with oil and gas 
properties as it originally proposed?
    Secretary Babbitt. Well, Senator, in all honesty, it was in 
no small measure due to your letters to the Department 
reflecting some skepticism about that approach.
    Senator Gorton. Well, I ought to quit while I am ahead. 
[Laughter.]

                          park service funding

    On that one at least. The Park Service, which is a favorite 
of mine and I suspect of yours, has been treated more 
generously than most of the rest of your budget last time and 
this time around. What factors, in your view, exist with 
respect to the Park Service that do not exist with respect to 
other agencies funded by this committee, causing it to get the 
lion's share of these increases?
    Secretary Babbitt. Senator, it is real simple, it is called 
5 million people a year at Grand Canyon, 4 million people a 
year at Yosemite, and 3 million people a year at Yellowstone. 
This land management agency is uniquely, as one of my fervent 
supporters over here suggested, an agency which deals with 
people. And that is where the money goes.
    Senator Gorton. And what are your three or four top 
priorities for the Park Service?
    Secretary Babbitt. I believe that the issues in the 
National Park Service are approximately in this order. First, 
managing the increase in visitation and doing it to separate 
cars from people, through innovative and thoughtful 
transportation and management plans. We have a big continuing 
problem of dealing--I will wander only for one sentence--we 
still have border problems of incompatible uses impinging on 
parks. The New World Mine is a good example. The bison issue 
which so excites Senator Burns and myself is in fact a border 
management problem that I believe we can resolve, but there are 
many, many of those.
    We have an upstream water issue in Zion, which I think we 
now have control over. I would say repair and upgrading of 
infrastructure remains a problem. I believe, in all candor, 
that we can gradually whittle that away. I do not think there 
is a dramatic single-shot solution in sight, but we are making 
some progress. We will be back with some more thoughts. We have 
not explored all of the alternatives. But I would say those are 
the three issues.

                                presidio

    Senator Gorton. Last month I spent something more than half 
a day at the Presidio just before the members of the trust were 
appointed. The Park Service is working on a plan under which 
the trust will end up managing as much as 80 percent of the 
property. You have referred to the trust activities, and I 
believe I am quoting you accurately, ``as managing a city 
within a city.'' I think that gets to the heart of the 
challenge or the problem that we have here.
    It is an absolutely magnificent place obviously, but it is 
hard for me to shake the belief that it is still primarily a 
city asset and a city or a regional park. The GAO has said that 
the expenditures that have been made so far are consistent with 
the management plan. They gave us as good and as favorable a 
report as possible. We are still talking about $25 million for 
the course of the next year.
    So tell me if you can, how soon you expect the Board of 
Directors of the Presidio Trust to be fully operational, making 
the basic management decisions about the future of the site? 
How long should it take the Presidio to generate sufficient 
revenues to finance its own operations? And what kind of 
decline in Federal monetary responsibilities do you see as we 
look forward to, say, the next 5 years or so?
    Secretary Babbitt. A couple of thoughts. The Directors, as 
you know, have been appointed. I am enormously gratified at the 
quality of the selections that were made. I think we have a 
real chance at some superb management. There is one--there are 
actually two issues that that board faces, and I believe that 
the ramp-down and the success of the basic assumptions are 
going to depend on.
    The board is going to have to make a difficult and 
important decision about how many of those buildings should be 
decommissioned and taken down. There is an enormous overhang of 
maintenance and infrastructure there. Unless a realistic 
decision is made about what can be utilized at a rational cost 
with the expectation of self-sufficiency, we are going to have 
a big problem.
    Now, what I am saying in plain words is we cannot treat 
every structure on that magnificent landscape as a candidate 
for historic preservation. It is going to be a difficult and 
sensitive issue, but that is, to me, the key initial decision.
    Once we have a realistic grip on what improvements are 
essential and should be saved, then it becomes a matter of 
streaming them into something resembling a commercial, 
historically protected real estate market. I think those are 
the issues.
    Senator Gorton. You cannot give me any estimate, then, as 
to how long those questions will require not only to make but 
to implement?
    Secretary Babbitt. Well, I think the important front-end 
decision for this board as it gets under way is to get out a 
map, do a careful inventory of these buildings, and make the 
cut on what it is that can be realistically preserved, rehabed, 
and maintained, with the expectation of self-sufficiency, and 
those that cannot.
    Now, how long will that take? I am not a professional real 
estate manager, but I can certainly identify that for you as 
the core question.
    Senator Gorton. It is. There actually have already been 
some successes there. And there are obviously some other 
buildings that can probably be rehabilitated in a relatively 
short period of time and make a profit. I am concerned, and I 
express through you the concern, that the Presidio not end up 
being a cash cow for social problems in San Francisco. The 
willingness of this committee, and I think of the Congress as a 
whole, to provide a very significant level of funding for an 
extended period is, it seems to me, going to depend very 
largely on whether or not we are left with the impression that 
it really is a park, that it is a public facility, open for and 
useful for people, not just in the immediate area, but all 
across the United States.
    That is simply a comment. If you wish to comment on it, you 
may.
    Secretary Babbitt. Senator, rather than wading straight 
into that, I would ask you to take judicial notice of the 
statements of Congresswoman Pelosi and Deputy Secretary 
Garimendi. They have both been there. They are both creatures 
of the bay area, and they have been pretty forthright in their 
responses.
    Senator Gorton. I know they have. And I find that quite 
encouraging.

                               c&o canal

    Now, tell me what the status is of the restoration of the 
Chesapeake & Ohio Canal National Historic Park.
    Secretary Babbitt. I think it is a wonderful success story. 
It is not entirely done, but most of it is, as you can see if 
you go out for a morning trip along the towpath. The boats are 
back on the canal in Georgetown. The locks have been restored 
sufficiently to rewater the portion of the canal at Great 
Falls, and the boats are back on the canal. The remaining work 
now, I think, is focussed mostly on some of the outlying canal 
structures and the historic buildings, not just here but all 
the way up to Harper's Ferry. The towpath is back in operation. 
That is the most frequent question I get.
    Senator Gorton. How much longer and how much money for full 
restoration?
    Secretary Babbitt. I believe that the vast majority of the 
restoration will be done across this summer season. I do not 
anticipate any more requests for funds.

                          central utah project

    Senator Gorton. Thank you. Now, the rest of my questions I 
will submit in writing as well. I do have the questions that 
are most interesting and absolutely vital to Senator Bennett, 
so I am going to read these questions to you. But the ``I'' of 
the first person will be those of Senator Bennett rather than 
myself.
    I want to discuss with you some serious implications for 
the central Utah project and other upper basin water projects 
being created by a preliminary draft biological opinion for the 
Duchesne River. This preliminary draft issued by the Fish and 
Wildlife Service proposes, in short, to ignore and undermine 
the Upper Colorado River basin recovery implementation plan for 
the razorback sucker.
    As you know, the recovery implementation plan [RIP] was 
developed in March 1988, between the Department of the Interior 
and the States of Utah, Wyoming and Colorado, to quote, 
``provide the reasonable and prudent alternatives for projects 
undergoing section 7 consultation in the upper basin,'' to meet 
the needs of the Endangered Species Act. To date, some $55 
million of Federal and State moneys have been spent on various 
RIP programs to recover the Colorado River endangered fishes.
    In fact, Mr. Secretary, your fiscal year 1998 budget 
request includes roughly $8 million for the RIP. The Fish and 
Wildlife Service has been involved in a section 7 consultation 
to determine the impact of the Spanish Fork Canyon to the NEPHI 
water pipeline feature of CUP on the razorback sucker habitat 
in the lower 2\1/2\ miles of the Duchesne River. The 
preliminary draft biological opinion, released on March 14, 
1997, abandons the RIP.
    It says, and I quote: ``The Service has determined that, as 
of this date, the recovery program has not made sufficient 
progress toward recovery of the fishes to serve as the 
reasonable and prudent alternatives to avoid jeopardy.''
    Mr. Secretary, I hope this draft statement does not 
represent the current position of the Department concerning the 
efficacy of the RIP. If it does, I am afraid of the reaction 
that you will get from the upper basin States, who have worked 
hard for almost 10 years to recover the fish, under the 
assumption that the recovery program provides an umbrella of 
protection under the Endangered Species Act for the upper basin 
water projects, like CUP.
    Is the RIP, in your view, a viable program, which is making 
sufficient progress to continue to serve as the reasonable and 
prudent alternative for the upper basin water projects?
    Secretary Babbitt. Senator, two thoughts. I do not think 
that we are on a collision course over these consultation 
issues in CUP. But I understand your concerns. What I will do 
is write you a letter, and see if I can outline these issues. 
But, again, I am pretty confident that we can get this worked 
out and that, the technicalities aside, there is not an 
underlying problem here which is going to materially impact the 
CUP construction schedule.
    Senator Gorton. The RIP recovery action plan, RIPRAP, has 
concentrated resources and prioritized funds to accomplish 
recovery of the species principally in the Green and Colorado 
Rivers. The RIP agreement of 1993 specifically says: 
``Sufficient progress will be evaluated separately for the 
Colorado and Green Rivers subbasins, but not individual 
tributaries within each subbasin.''
    The March preliminary draft opinion, however, is in 
fundamental contradiction with this provision of the RIP 
agreement, and proposes monthly flow recommendations for the 
Duchesne River, a tributary of the Green River. These flow 
recommendations are based, admittedly, upon little or no 
historical biological data. Furthermore, the razorback sucker 
habitat on the lower Duchesne River is controlled, in essence, 
by the elevation of the Green River. Taking water from the CUP 
and other upstream projects will have little or not impact upon 
the depth and velocity of the water in the lower Duchesne 
habitat.
    It appears to us, Mr. Secretary, that the goal of this 
preliminary draft opinion is to take water from CUP and other 
water projects in the name of trying to reestablish fish 
habitat in the lower reach, the small tributary of the Green 
River. This approach is inconsistent with the RIP and should be 
withdrawn in favor of an approach which is in harmony with the 
RIP program. The RIP must continue to serve as the reasonable 
and prudent alternative for the upper basin projects, like CUP 
or the upper basin States will abandon the RIP process.
    Will you personally acquaint yourself with respect to this 
preliminary draft biological opinion for the Duchesne River to 
ensure that the RIP continues to function as a viable program 
to recover the endangered fish in the upper basin, which can be 
supported by the State of Utah?
    Secretary Babbitt. Senator, I would be happy to do that. I 
will look into this. Because I genuinely do not think that 
there is any threat or intent or even any possibility that the 
water supply of CUP would be impacted. But I understand your 
concerns. And I will get onto this and get back to you.
    [The information follows:]

                     Additional committee questions

    Senator Gorton. There will be some additional questions 
which will be submitted for your response in the record.
    [The following questions were not asked at the hearing, but 
were submitted to the Department for response subsequent to the 
hearing.]
                     Additional Committee Questions
                           interagency issues
Headwaters and new world mine
    The Department has been engaged in complex negotiations with 
Maxxam, Inc. to determine assets that can be exchanged for a portion of 
the Headwaters Forest. The cost of this deal is upwards of $250 
million.
    Question. What is the current status of the negotiations?
    Answer. The negotiations referenced above regarding ``assets that 
can be exchanged'' ceased with the adoption of the Bipartisan Balanced 
Budget Agreement (BBA), which calls for $700 million in additional 
funding for Federal land acquisitions and exchanges. Up to $315 million 
of that amount would be available to finalize priority Federal exchange 
proposals. Negotiators understood that those exchanges included up to 
$250 million for the Headwaters Forest exchange in California and up to 
$65 million for the New World Mine exchange outside Yellowstone 
National Park in Montana.
    This Administration is involved in acquiring, exchanging, or 
withdrawing non-Federal lands in several major deals, including the 
Headwaters Forest, the Grand Staircase-Escalante National Monument, and 
the New World Mine. As mentioned, one of the land deals the 
Administration is working on is the proposed Headwaters Forest exchange 
in California. The particulars of the proposed deal have been somewhat 
fluid in the eight months since an agreement was signed between the 
United States, the State of California, and Maxxam, Inc., the owner of 
the private forest lands the Department wants to protect.
    In early April, this Committee received a letter from Bonnie Cohen, 
the Assistant Secretary--Policy, Management and Budget. The letter 
proposed reprogramming $1.2 million from the Bureau of Land Management 
(BLM) budget for work on the proposed land exchange. The letter 
identified the following tasks that would be initiated with the 
requested funds: (1) appraisal of the privately-held forest properties 
that the Federal Government wishes to acquire; (2) appraisal of 24 oil 
and gas leases on public lands in California identified as Federal 
assets for the deal; (3) establishment of an auction process for the 
leases; and (4) amendment of the BLM Resources and Management Plan to 
change the oil and gas mineral estate from retention status to disposal 
status.
    Together Senator Byrd and I decided not to raise an objection to 
the reprogramming request. We both appreciate the value of protecting 
old growth timber lands where a deal can be made. However, my approval 
of the request was not without some concerns, as you know from the 
letter I sent to you on April 24th. And I know that Chairman Murkowski 
of the Energy and Natural Resources Committee, another Committee of 
which I am a member, wrote to you of his concerns. I believe, also, 
that the House Appropriations Committee also has written to you about 
their concerns.
    Question. Will these tasks be completed with the funds requested? 
If not, how much more will be necessary from the Federal Government to 
complete the appraisals and other preliminary work?
    Answer. Plans for exchanging subsurface estate and other assets for 
the Headwaters Forest have been rendered moot under the land exchange 
negotiations associated with the Balanced Budget Agreement. While the 
Department appreciates the reprogramming latitude provided by the House 
and Senate Subcommittees, we cannot now foresee the need to conduct any 
further activities identified in the April 1997 reprogramming letter.
    The majority of the assets identified for exchange are active oil 
and gas properties in California. I understand the Administration will 
exchange these properties under the authority of the Federal Lands 
Policy and Management Act (FlPMA), and that the properties will then be 
auctioned and the proceeds will be used to compensate Maxxam.
    Question. Is this essentially correct?
    Answer. Again, plans for exchanging subsurface estate and other 
assets for the Headwaters Forest have been rendered moot under the land 
exchange negotiations associated with the BBA. As a priority land 
exchange, the Headwaters Forest will be acquired from Maxxam for up to 
$250 million appropriated from the Land and Water Conservation Fund.
    The sale of these oil and gas properties will reduce Federal 
receipts by about $100 million.
    Question. Does the Administration's budget reflect a reduction in 
mineral receipts in fiscal year 1998 and beyond as a result of the 
Headwaters deal? If not, why not?
    Answer. The budget reflects no reduction in mineral receipts as a 
result of the Headwaters land exchange. The fiscal year 1998 budget was 
prepared before the terms of the exchange had been finalized. The final 
exchange, as described above, will not reduce mineral receipts since, 
pursuant to the BBA, funding will be provided from the Land and Water 
Conservation Fund.
    The Administration is pursuing similar negotiations to acquire the 
New World Mine site near Yellowstone National Park. In this instance, 
the Administration is proposing to exchange the revenue stream from 
active oil and gas leases for the property to be acquired. This will 
require legislation, and as such will trigger the PAYGO provisions of 
the Budget Act. The Administration's proposed offset for this 
exchange--an adjustment in the Conservation Reserve Program--has met 
with fierce opposition.
    Question. Why is the Administration using the oil and gas revenue 
stream in this instance--which requires legislative action--and the oil 
and gas estate in the Headwaters acquisition--which can apparently be 
done administratively?
    Answer. Under terms of the BBA, neither the revenue stream nor the 
oil and gas estate will be exchanged by the Federal Government for the 
New World Mine or Headwaters properties.
    Question. Though the magnitude of the two deals are different, is 
there any appreciable difference between the two deals in terms of the 
effect on mineral receipts to the U.S. Treasury?
    Answer. As mentioned above, under the terms of the BBA, neither the 
revenue stream nor the oil and gas estate will be exchanged by the 
Federal Government for the New World Mine or Headwaters properties.
    This Committee has been informed that the Administration is relying 
on authority granted it by FlPMA to execute the Headwaters exchange. 
The oil and gas properties being used in the exchange are being treated 
as public lands under FlPMA.
    Question. Is the use of producing oil and gas properties for 
exchanges a well established practice under FlPMA?
    Answer. The use of properties for exchange that have been valued 
under a competitive auction process that establishes a fair market 
value return to the Government is a well established procedure under 
FlPMA, the General Exchange Act of 1922, and the Weeks Act.
    Question. Are you aware of any previous exchanges of this nature? 
Of the magnitude of the Headwaters exchange? Can you provide some 
examples for the record?
    Answer. The Department can document numerous exchanges that 
required asset value appraisal to determine fair market return; none 
equal the funding magnitude of the Headwaters exchange.
    Question. If this has not been common practice, has the 
Administration produced a legal opinion supporting the use of FlPMA in 
this manner? If so, please submit for the record.
    Answer. Because the use of FlPMA for the Headwaters Exchange has 
not been under active consideration for several months, a legal opinion 
on the subject was never signed.
    Materials provided by the Department indicate that nearly $1 
billion in annual revenues accrue to the Treasury from Federal onshore 
oil and gas leases.
    Question. Does this Administration plan on using these receipts as 
a sort of piggy bank from which to draw when it feels a particular 
property is worth acquiring?
    Answer. The Administration never proposed using oil and gas 
receipts to acquire the property. Rather, initially it proposed 
exchanging the sub-surface estate at the oil and gas sites for 
Headwaters--a land for land exchange. The question implies that the 
Administration planned to draw money from some receipt-based account 
(i.e., piggy bank) for the acquisition; that was not the case at all.
    Question. In theory, couldn't all of these receipts be used for 
acquisitions like Headwaters without there being any effect on Federal 
revenues, and therefore any impact on the budget deficit? Does this 
seem proper to you?
    Answer. As stated earlier, no receipts were being used to acquire 
Headwaters. Prior to the BBA, the acquisition was being established as 
a land exchange.
    Question. Would you support changes to FPLMA that would limit what 
is in effect the administrative use of a concrete, estimable revenue 
stream in a manner that requires no budgetary offset?
    Answer. The Administration would not support such changes to FlPMA. 
The exchange contemplated for the Headwaters Forest (and now made moot 
by use of LWCF funds under the BBA) was only possible because PAYGO 
neutrality was maintained.
    I understand that as part of the Headwaters deal, the 
Administration has promised to ``make whole'' the State of California 
for the share of revenues it will lose from the Federal oil and gas 
properties to be traded. This could amount to $100 million.
    Question. Does the Administration have any idea how it will fulfill 
this promise? Do you have any expectation that the Administration will 
call upon the Appropriations Committee for this purpose?
    Answer. Use of up to $250 million in funds appropriated from the 
Land and Water Conservation Fund will satisfy the Federal Government's 
commitment in the Headwaters land exchange; therefore, there will be no 
need to compensate the State of California since it will not lose 
revenues.
                          uncontrollable costs
    It appears that the fiscal year 1998 budgets for different bureaus 
within the Department are treated differently with respect to 
uncontrollable costs.
    Question. Do the requests for some bureaus include funding for 
uncontrollable costs while others do not? How does the Department make 
these determinations? Please provide for the record a table that shows 
how much of each bureaus' uncontrollable costs are to be funded through 
increases and how much are to be absorbed.
    Answer. In an optimum budget with unlimited resources, each of the 
bureaus would be requesting increases for uncontrollable costs. While 
the Department began the formulation process for fiscal year 1998 with 
that goal in mind, the realities of balancing the budget forced 
difficult choices about the priorities for program increases and 
overall funding levels for individual bureaus. As a result, while most 
bureaus were able to cover uncontrollable costs with funding increase 
requests, a few (e.g., U.S. Geological Survey, Departmental Management, 
and Solicitor) were not. The Department's instruction to all bureaus 
was that ``uncontrollable cost changes will be shown and described'' in 
the Justifications.

                                              UNCONTROLLABLE COSTS                                              
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                                  Uncontrollables               
                                                                 -----------------------------------------------
                                                                    Absorbed or                                 
                             Bureau                                  offset by       Funded in                  
                                                                     projected        request          Total    
                                                                      savings                                   
----------------------------------------------------------------------------------------------------------------
Land Management.................................................  ..............          14,500          14,500
Minerals Management.............................................           2,574             967           3,541
Surface Mining..................................................             229           1,169           1,398
Geological Survey...............................................          16,048  ..............          16,048
Fish and Wildlife...............................................           1,191          10,623          11,814
Park Service....................................................  ..............          22,617          22,617
Indian Affairs..................................................             417          18,805          19,222
Departmental Management.........................................           1,296  ..............           1,296
Insular affairs.................................................  ..............              87              87
Solicitor.......................................................             894  ..............             894
Inspector General...............................................             582              61             643
Special Trustee.................................................  ..............             499             499
                                                                 -----------------------------------------------
      Total Department..........................................          23,231          69,328          92,559
----------------------------------------------------------------------------------------------------------------

    Question. Also, please provide for the record a table summarizing 
the degree to which bureaus' uncontrollable cost increases have been 
funded or absorbed in fiscal years 1995, 1996, 1997, and 1998.
    Answer. The Department does not maintain records showing 
uncontrollable cost history. The following table has been assembled 
based on bureau records, the Justification documents, and other 
analyses on file in the Department's Office of Budget. Note that unlike 
the previous table, the following one is adjusted to reflect the 1.51 
percent increase in CSRS retirement charges, which is now assumed by 
the balanced budget agreement.
    The first line under each bureau shows its estimate of the total 
amount required to offset that year's changes in uncontrollable costs 
such as pay, retirement costs, rent, unemployment and workers 
compensation payments. A negative amount in this line indicates base 
funding for uncontrollable costs went down.
    The second line shows the amount of uncontrollable cost changes 
absorbed. By ``absorbed'' we mean that the funds needed to offset the 
increased costs were: (1) not requested; (2) requested, but paid for 
out of proposed programmatic reductions or projected efficiency gains 
in the base program; or (3) requested but not appropriated. For each 
bureau, if the amount shown on the second line equals the requirement 
(the amount shown on the first line), then the full amount of 
uncontrollable costs are absorbed. If it is less, then the 
uncontrollable costs were partially absorbed for that year. In a few 
cases, the amount in the second line is greater than the amount 
required to pay for that year's uncontrollable costs changes, 
indicating that not only were all new uncontrollable costs absorbed, 
but the base for paying for uncontrollable costs was also reduced.

                    FUNDS REQUIRED TO OFfSET UNCONTROLLABLE COST CHANGES AND AMOUNTS ABSORBED                   
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                     Bureau                            1995            1996            1997            1998     
----------------------------------------------------------------------------------------------------------------
Land Management:                                                                                                
    Total requirement...........................           1,124          10,861           5,330          18,049
    Amount absorbed.............................           1,124             978             569           3,549
Minerals Management:                                                                                            
    Total requirement...........................           1,822           3,385           3,000           4,456
    Amount absorbed.............................             869           3,385           3,000           3,489
Surface Mining:                                                                                                 
    Total requirement...........................             526           1,900           1,807           1,804
    Amount absorbed.............................             120           1,900             808             635
Geological Survey:                                                                                              
    Total requirement...........................          12,513          11,722          11,292          20,420
    Amount absorbed.............................           5,470          11,515          11,292          20,420
Fish and Wildlife:                                                                                              
    Total requirement...........................          14,706          14,410          12,300          13,907
    Amount absorbed.............................          15,587          16,180          12,400           3,284
Park Service:                                                                                                   
    Total requirement...........................          -6,866          34,782          18,711          26,822
    Amount absorbed.............................           8,111          16,798          16,164           4,205
Indian Affairs:                                                                                                 
    Total requirement...........................          18,322          28,503          22,852          21,998
    Amount absorbed.............................          18,322          28,503          22,852           3,193
Departmental Management:                                                                                        
    Total requirement...........................             805           1,377           2,078           1,753
    Amount absorbed.............................             767           1,405           2,078           1,753
Insular Affairs:                                                                                                
    Total requirement...........................             157              98              72              87
    Amount absorbed.............................              75  ..............  ..............  ..............
Solicitor:                                                                                                      
    Total requirement...........................            -688             753             791           1,068
    Amount absorbed.............................  ..............             753             191           1,068
Inspector General:                                                                                              
    Total requirement...........................             599           1,153             500             774
    Amount absorbed.............................             599           1,153  ..............             713
Special Trustee:                                                                                                
    Total requirement...........................  ..............  ..............             343             499
    Amount absorbed.............................  ..............  ..............             212  ..............
                                                 ---------------------------------------------------------------
Department total:                                                                                               
    Total requirement...........................          43,020         108,944          79,076         111,637
    Amount absorbed.............................          51,044          82,570          69,566          42,309
----------------------------------------------------------------------------------------------------------------
Note: Fiscal year 1998 based on the President's Budget request and adjusted for increase in CSRS employer       
  charges. Fiscal year 1995 through fiscal year 1997 are based on the combination of decisions in the           
  President's Budget request and the subsequent appropriations action.                                          

                         ecoregion assessments
    The Department has been working with the Forest Service on a number 
of broad, ``Ecoregion Assessments,'' one of which covers the Columbia 
Basin region. I was recently briefed on the draft Environmental Impact 
Statement (EIS) for the Columbia Basin assessment, which has been 
several years and some $30 million in the making. I understand that the 
measures outlined in the EIS will cost $125 million more than current 
budgets.
    Question. What benefits will the American people receive from the 
$30 million invested in the Columbia Basin EIS? For other ecoregion 
assessments in the works?
    Answer. For the first time ever, the American people have a 
comprehensive look at the people and places within the Interior 
Columbia Basin, and ways to deal with the challenges the people of the 
region face. For local land managers, this effort will provide them a 
scientifically sound framework to make local decisions that will 
improve the health of public lands both locally and regionally.
    Consolidating efforts reduces duplication of efforts and provides a 
catalyst for comprehensive, more defensible assessments, EISs, and 
decisions by land managers. As a result, a better product is attained 
for a reduced cost than what could occur using an administrative unit 
by unit approach.
    Thus far the effort has produced:
  --A wealth of information found in the scientific assessment that 
        characterizes social, economic and ecological conditions, 
        trends, risks, and opportunities throughout the Interior 
        Columbia River Basin, an area over 145 million acres.
  --Over 170 data layers and 20 data bases available to land managers 
        and the public; they will assist in future planning and 
        implementation.
  --Strengthened relationships between States, tribal, and county 
        governments.
    Finally, this effort should reduce the vulnerability to legal 
challenges. If the 45 administrative units within the Basin were to 
address, independent of each other, broad scale issues such as forest 
and rangeland health, salmon survival, Federal Government treaty 
responsibilities to Tribes, or impacts to local economies, inevitable 
inconsistencies would occur creating legal vulnerability.
    People within the Columbia Basin who live and work on or near those 
lands covered by the EIS are concerned that the ecoregion planning 
process will result in a ``one size fits all'' approach to land 
management that will not reflect the particular needs of individual 
watersheds, forests, etc.
    Question. How do you respond to this concern?
    Answer. We have developed a consistent but not a one size fits all 
approach. The scientific assessment has shown us that a one size fits 
all approach will not lead to the restoration of public lands because 
of the variability across the Basin. However, consistent approaches on 
how we analyze problems and implement strategies to remedy these 
problems will.
    The Draft EISs have a combination of process standards as well as 
prescriptive standards. Process standards provide the ``how to'' in 
going from the broad scale to an on-the-ground project. Prescriptive 
standards describe what should be done factoring in variations in 
vegetation and the lay of the land. Adjustments to prescriptive 
standards can and should be made when they are not meeting objectives 
due to local conditions. The mechanism to adjust standards to meet 
local conditions is part of the overall strategy.
    Question. If the ecoregion planning process is truly flexible 
enough to accommodate local management requirements, what additional 
benefit do the assessments provide above that which would accrue from a 
more local planning process?
    Answer. The scientific assessment provides local managers a wealth 
of information that is consistent across the basin but can be used in 
local planning processes. It would have been more difficult and 
expensive to collect and analyze this information on an administrative 
unit by unit basis. This information is important to local managers in 
developing cumulative effect analyses, important in their planning and 
decision processes.
    The Draft EISs focuses on issues that are more efficiently and 
effectively addressed using a broad scale approach. They do not attempt 
to resolve issues that are more effectively addressed at the local 
level. The draft EISs provide the context for local managers to make 
decisions with a better understanding of the larger issues.
                   national petroleum reserve--alaska
    The Department of the Interior recently announced that it is 
beginning to develop an ``integrated activity plan'' and EIS for about 
4.6 million acres in the northeast corner of the National Petroleum 
Reserve-Alaska (NPR-A).
    Question. Please tell the Committee what types of issues and 
matters will be studied in the ``integrated activity plan.''
    Answer. The Integrated Activity Plan (IAP)/EIS will address the 
full range of BLM management responsibilities in the planning area. 
Besides oil and gas development, BLM will look to update its management 
strategies for fish and wildlife, recreation, realty, hazardous 
materials, soil, water, air, and the protection of cultural and 
subsistence resources. The NPR-A is closed by law to mineral 
development other than oil and gas, so management of those resources 
will not be discussed.
    Question. How long will this process take?
    Answer. We plan to issue a Record of Decision for the IAP/EIS by 
August 1998.
    Question. How much is it expected to cost?
    Answer. Total cost of the project is projected to be $8 million. 
This cost will be shared by BLM ($4.6 million) and the Minerals 
Management Service (MMS) ($3.4 million). The project is divided into 
two parts. The IAP/EIS portion of the project will cost $4.4 million. 
The oil and gas evaluation and preparation for a potential lease sale 
will cost $3.6 million. These costs include both labor and operational 
costs.
    Question. From which agency budgets will the funds for this plan 
come?
    Answer. Both MMS and BLM will fund components of this plan. Each 
agency will absorb personnel costs. All operational expenses, including 
travel, printing, and purchase of industry seismic data, will be borne 
by BLM.
    Question. Does the budget request for fiscal year 1998 contain 
amounts for the work needed?
    Answer. The costs for fiscal year 1998 will be funded from within 
the amount requested in the President's fiscal year 1998 Budget.
    Committee staff have heard that, in order to do the work on the 
NPR-A, personnel from MMS would be brought over to help and that, 
potentially, some Outer Continental Shelf (OCS) lease sales in Alaska 
could be delayed. The delay of OCS lease sales costs the Federal 
Government and the State of Alaska--in the loss or delay of royalties. 
The NPR-A will be a long time in coming to fruition, so it is not an 
equal trade-off.
    Question. Can you tell us more about exactly how the Department 
intends to do the NPR-A work?
    Answer. The BLM has entered into a Cooperative Agreement with MMS 
to do part of the work for this IAP/EIS. Although BLM personnel are 
involved with all aspect of the IAP/EIS, MMS has primary responsibility 
for describing the affected environment, including the oil and gas 
resources, and for describing the environmental consequences. Their 
personnel have also been central to providing a reasonable, foreseeable 
development scenario for oil and gas development.
    Question. Are OCS lease sales in Alaska being delayed? Is the State 
of Alaska comfortable with the delay?
    Answer. Only Sale 173, Cook Inlet, will be delayed. This sale, 
originally scheduled for 1999, will be delayed until 2001 so that MMS 
efforts can be devoted to the resource and environmental evaluation of 
NPR-A. The State of Alaska is anxious for the NPR-A effort to proceed 
and has not voiced any objections about the delay of Sale 173.
    Much of the reason there was little interest in previous NPR-A 
lease sales was due to the fact that industry was not comfortable with 
the lease terms available under regulations promulgated by BLM, 
including those addressing unitization or suspension of leases. Lease 
suspension and unitization are permitted on other Federal lands under 
the Mineral Leasing Act. However, the Department's Solicitor concluded 
in a 1981 opinion that the NPR-A leasing authority, because it was 
contained in the Interior Appropriations Act for fiscal year 1981, 
constituted new and independent leasing authority, and that the terms 
of the Mineral Leasing Act do not apply.
    Question. What is the Department doing to ensure that if a lease 
sale is recommended at the end of the IAP/EIS process the lease terms 
and conditions are such that industry will be interested in leasing in 
NPR-A?
    Answer. In 1982 and 1983, BLM held three oil and gas lease sales in 
NPR-A. The sales totaled approximately 1,350,000 acres and yielded the 
Government $106.5 million in bids and rentals. In 1984, a fourth lease 
sale obtained no bids. Contributing to the lack of bids in that sale 
was the inherently poorer quality of the lease tracts offered for sale, 
heightened interest in oil and gas exploration in the Arctic National 
Wildlife Refuge (ANWR), and industry concerns about lease terms. Since 
the last lease sale, the Department has reexamined the applicable law. 
The Department believes it has the authority to issue new regulations 
to address unitization and clarify suspension, if necessary. We 
anticipate having necessary regulations in place prior to any leasing 
which may result from the IAP/EIS effort. By law, lease blocks can be 
up to 60,000 acres. We anticipate that the concerns regarding 
consolidation and the size of lease blocks will be addressed within the 
context of unitization regulations.
    At the request of Senator Stevens last year, we were going to try 
to add an amendment to the fiscal year 1997 Interior bill to make 
certain terms of the Mineral Leasing Act applicable to the NPR-A. I 
understand that the Department supported this amendment, which provides 
for environmentally-responsible unitization of leases by the oil 
companies so that fewer wells have to be drilled.
    Question. Is it still the Department's opinion that legislation is 
needed to allow unitization?
    Answer. No. The Department plans to issue regulations addressing 
unitization.
    Question. Will the Department support the addition of language in 
the fiscal year 1998 bill, if it is requested by members, that it 
supported last year to allow unitization in the NPR-A?
    Answer. Legislation is unnecessary since the Department has the 
administrative authority to address unitization in regulations.
    The Naval Petroleum Reserves Production Act of 1976 directed that 
several reports be prepared on the NPR-A, including one regarding the 
``development, production, transportation, and distribution of 
petroleum resources'' and another on the ``value, best use, and 
appropriate designation of the lands'' within the reserve.
    Later, in the Department of the Interior Appropriations Act for 
fiscal year 1981, Congress appropriated $107 million for, among other 
things, an EIS on competitive oil and gas leasing in the reserve.
    Question. Can you tell the Committee what the IAP and EIS will 
accomplish that the previous studies, reports, and EIS did not?
    Answer. As the Committee notes, there have been a number of studies 
of NPR-A. The current planning effort will make use of the data derived 
as part of these studies, as well as the results of more recent 
investigations. The IAP/EIS, however, will address issues and utilize 
knowledge and information which was not pertinent or available in the 
1970s and early 1980s. Furthermore, there have been regulatory changes 
which make the 1983 EIS (which was done pursuant to the fiscal year 
1981 Interior Appropriations Act) outdated. Since that EIS was drafted, 
the Federal Government has assumed a greater responsibility for 
management of subsistence resources, has promulgated a wetlands policy 
which affects development in the planning area, and has both de-listed 
the peregrine falcon and added the spectacled eider and Steller's eider 
to the list of threatened and endangered species. The new IAP/EIS will 
address management within the context of these new rules.
    Oil development technology has evolved as well. The IAP/EIS will 
analyze impacts from development, taking into account new oil industry 
technology which in some instances may lessen those environmental 
consequences. At the same time, development on the North Slope has 
matured, and as a consequence we can produce an updated and more 
accurate picture of cumulative impacts of any further oil and gas 
development.
    There has been considerable additional resource information about 
the North Slope gathered by the Federal Government, the State of 
Alaska, the Borough, and others. The IAP/EIS will take advantage of 
this better understanding of Arctic resources to reexamine our nearly 
15 year old oil and gas leasing program and to put in place updated 
management for all the resources in the planning area.
    We also need to update the 1983 EIS because it has some technical 
flaws (e.g., it lacks a ``no action alternative''). These flaws, in 
addition to its dated nature because of changes in regulations and the 
on-the-ground situation, make it unlikely any leasing program based on 
the old EIS could successfully withstand a court challenge.
    Question. Will different issues be addressed? If so, what are they? 
Will you provide the Committee a detailed description of the work to be 
performed, issues to be analyzed, and matters to be examined as part of 
the IAP/EIS process?
    Answer. The IAP/EIS will follow the standard EIS process, including 
holding public meetings and soliciting written responses to help define 
issues and obtain comments on the draft plan, preparing descriptions of 
the potentially affected environment and the consequences of following 
a range of alternative future management strategies, responding to the 
public's concerns, and publishing a final decision.
    The public outreach program includes repeated visits to the North 
Slope villages nearest the planning area, news releases, a series of 
newsletters, an internet web site, participation on radio call-in 
shows, and meetings with environmental, industry, Native, and State 
representatives. A symposium of leading scientists from agencies of the 
Federal, State, North Slope Borough Governments, universities, private 
groups, and firms has been held to assure that authors of the IAP/EIS 
will have the most up-to-date information about development and 
resources on the North Slope.
    The North Slope Borough, State, and the Fish and Wildlife Service 
(FWS) are represented on a coordinating group to share their concerns 
with top BLM Alaska managers on the NPR-A effort. The BLM Alaska office 
has established cooperative agreements with the State and the North 
Slope Borough and has funded positions to work directly with the 
planning team. The State's NPR-A staff person has an office with BLM 
NPR-A staff members at the BLM State Office in Anchorage.
    The public has helped identify issues to be addressed in the IAP/
EIS. In addition to input concerning possible oil and gas development, 
wildlife values associated with the region around Teshekpuk Lake and 
recreation and wildlife values of the Colville River valley are of 
special concern. While North Slope residents have stated their interest 
in participating in any economic development in the area, they 
repeatedly expressed the importance of the availability and 
accessibility of subsistence resources, such as caribou, waterfowl, fur 
bearers, and marine mammals. Others are interested in protecting 
cultural and paleontological resources and adding unique areas, such as 
the Pik sand dunes, to the Special Areas.
                          superfund liability
    The Federal Government is liable just like any other landlord under 
Superfund as an owner of property where a release of hazardous 
substances occurred.
    Question. To what extent does Interior intend to have the Federal 
Government pay its fair share at these cleanup sites? How much will 
that be?
    Answer. The Department, as a land owner under the Comprehensive 
Environmental Response, Compensation and Liability Act (CERCLA) may be 
liable as a Potentially Responsible Party (PRP) for a portion of the 
cleanup costs on our property. This portion may not be recovered from 
other PRPs. Depending upon the viability of other PRPs, the 
Department's share may fluctuate above its fair share. Under this 
circumstance, the Department will always need some level of annual 
appropriation. This level will vary on an annual basis dependent upon 
agreements with regulators and with other PRPs and the work scheduled 
to be performed in that year. Because the Department as a Federal 
agency is not eligible for money from Superfund, demand for response 
and remedy always exceeds funds available by many times. Federal costs 
avoided or recovered on one Interior site often will have to pay for 
defunct or unidentified PRPs on another site.
    The Central Hazardous Material Fund is budgeted at $14 million for 
fiscal year 1998. This is roughly the amount spent on average for 
cleanup at a single site. It does not appear to be an adequate amount 
given the significant joint and severe liability facing the Federal 
Government at unpatented abandoned mine sites.
    Question. How does the Department plan to fund its liability at 
these sites?
    Answer. Abandoned Mine Lands (AML) on the public lands may contain 
both physical safety and environmental hazards. Existing data indicates 
that there are approximately 70,000 AML sites on public lands. The BLM 
field work has shown that about four percent of AML features are 
potential environmental hazards, ranging from lack of vegetation to 
water quality degradation. An AML site will become eligible for Central 
Hazardous Materials Fund (CHF) funding only after the applicable 
Interior bureau or the Environmental Protection Agency (EPA), whichever 
agency has the lead at such a site, has determined that a remedial 
investigation under CERCLA is called for. Examples of mining-related 
projects currently budgeted for in the CHF include Atlas Asbestos and 
Tar Creek. Other mining-related sites have been nominated for CHF 
funding but have not been considered for such funding due to a 
Congressional prohibition contained in the fiscal year 1997 budget 
prohibiting CHF funding of new sites.
    Question. To what extent is the Department relying on cost 
recovery, use of 106 order authority, and abandoned mine fund moneys to 
satisfy response and natural resource damage costs under Superfund on 
public lands under Interior jurisdiction?
    Answer. Within the context of CERCLA and its application and case 
law and the revolving fund intent of the Department's CHF, Interior 
pursues a policy of making polluters pay for the cost of their actions, 
wherever possible. It is the Department's policy to pursue cost 
recovery, cost contribution, or cost avoidance strategies with respect 
to other PRPs associated with the contamination of Departmental lands. 
Cost contribution involves the identification of specific liability for 
each PRP with a concomitant cost share. Cost contribution may be a more 
demanding and costly approach to addressing site liability because it 
requires the development and negotiation of an allocation among the 
parties, including Interior, early in the cleanup process, rather than 
simply suing the other PRPs after funds have been expended and 
requiring that they divide the liability among themselves vis-a-vis the 
Department. The Department of Justice has advised Interior that the 
cost contribution approach, rather than the cost recovery approach, may 
be required at a number of the Department's CHF projects. The other 
strategy utilized by the Department to control costs is cost avoidance 
by having PRPs actually fund and conduct cleanups with participation 
or/and oversight by the Department.
    Interior will cautiously use delegated 106 authority under CERCLA, 
and only where warranted, to accomplish the cleanup of contaminated 
sites by bringing PRPs to the table to contribute to the cost of 
cleanup. Interior, along with other Federal agencies, has been working 
with Justice and EPA to develop a Memorandum of Understanding (MOU) 
which will provide guidance for Federal agencies' use of delegated 
CERCLA 106 order authority. The principles which have governed EPA's 
previous implementation of 106 authority are incorporated into the MOU. 
The MOU would provide for use of 106 authority subject to concurrence 
by EPA and Justice. The MOU has not yet been finalized.
    For AML sites, Interior has an AML watershed initiative in which 
the Department is cooperating with Federal, State, and private partners 
to identify all sources of funds to clean up abandoned mine sites on 
public lands.
    Question. Does the Department plan to have all Superfund liability 
at Interior sites covered by the private sector?
    Answer. Within the context of CERCLA and its application and case 
law and the revolving fund intent of Interior's CHF, the Department 
pursues a policy of making polluters pay for the cost of their actions, 
wherever possible. It is the policy of the Department to pursue cost 
recovery, cost contribution, or cost avoidance actions against other 
PRPs associated with the contamination of Departmental lands. Cost 
contribution involves the identification of specific liability for each 
PRP with a concomitant cost share. As noted in our response to the 
previous question, cost contribution may be a more demanding and costly 
approach to addressing sites compared to cost recovery because it 
requires the development and negotiation of an allocation among the 
parties, including Interior, rather than simply suing the other PRPs 
after funds have been expended and requiring that they divide the 
liability among themselves. The Department of Justice has advised the 
Department that the cost contribution approach, rather than cost 
recovery, may be required at a number of the Department's CHF projects. 
The other strategy utilized by the Department to control costs is cost 
avoidance by having PRPs actually fund and conduct cleanups with 
participation or/and oversight by the Department.
    Interior, as a land owner under CERCLA may have some potential 
liability as a PRP for a portion of the cleanup costs on our property. 
There also are situations where illegal dumpers cannot be found or 
where past contaminators are no longer financially viable or perhaps no 
longer in existence.
    Where imminent hazard or substantial risk are present, the 
Department takes appropriate action, and then tries to find the parties 
that caused the pollution. Where more time is available, the Department 
will often find the responsible parties and get them to take action or 
to fund or contribute to the cleanup. Because the Department as a 
Federal agency is not eligible for money from Superfund, demand for 
response and remedy always exceeds funds available by many times. 
Federal costs avoided or recovered on one site often will have to pay 
for defunct or unidentified PRPs on another site.
    Under Federal law, Interior must provide a Consolidated Statement 
of Financial Position by March 7, 1997 that sets out the Department's 
financial position in a manner consistent with applicable accounting 
and financial reporting principles, standards, and requirements.
    Question. Will Interior be including potential Federal liability 
under Superfund for both response and natural resource damage costs in 
its Audited Financial Statement? If not, why not?
    Answer. The standards covering the recognition and disclosure of 
environmental liabilities are effective for fiscal year 1997 financial 
reporting (due March 1998). The Department will comply with these 
standards. The Department's Financial Report for fiscal year 1996 
includes disclosure of available environmental liability information, 
including Superfund sites. However this information is more limited 
that what will be presented in 1997 as procedures were not in place 
during 1996 to fully gather this data. The Department is currently 
addressing the data collection process to accurately and fully report 
this information in accordance with Federal accounting guidelines when 
the standards become effective in 1997.
    Question. Since the Federal Government Superfund liability at many 
of these sites may be significant by virtue of having owned the lands 
on which the hazardous substances were released, to what extent is 
Interior's liability for Natural Resource Damages being accounted for 
in the Consolidated Financial Statement required by public law?
    Answer. Environmental liabilities, including Superfund Liabilities, 
are to be recognized in the financial statements beginning in fiscal 
year 1997 when the existence of the liability is probable and the 
amount is reasonably measurable, provided that the Department is 
legally liable for the clean-up. The Department is currently evaluating 
all known sites to determine the extent to which these criteria are met 
and the range of the potential liability.
    The vast majority of the Department's environmental clean-up 
responsibilities arise from non-Department and non-Federal uses of the 
lands, such as illegal dumping, landfills, mineral extraction 
operations and pipelines. In these cases, the Government's 
responsibility derives solely from the fact that it is the current 
owner of the land, and the Department is often not ``legally liable.'' 
Wherever possible, the costs of clean-up will be recovered from 
responsible parties. In these cases, the standards require that the 
potential costs to be paid by the Department be discussed in the 
textual portions of the report (such as the footnotes) but not 
``recognized'' (presented on the face of the balance sheet) as a 
liability.
    The Department will recognize the potential liability for Superfund 
and other environmental cleanup costs in its fiscal year 1997 audited 
financial statements in accordance with standards promulgated by the 
Federal Accounting Standards Advisory Board. There is no current 
estimate of the dollar amount of this liability, pending completion of 
the Department-wide evaluation.
    Question. What is your estimate of the Government's total amount of 
liability for remediation of hazardous substances on Federal lands 
overseen by Interior? What is Interior's estimate of its liability for 
Natural Resource Damages?
    Answer. Environmental liabilities, including CERCLA liabilities, 
are to be recognized in the financial statements when both the 
existence and amount of the liability are probable and reasonably 
measurable. The Department is currently evaluating all known sites to 
determine the extent to which these criteria are met and the range of 
the potential liability.
    The vast majority of the environmental clean-up responsibilities 
arise from non-Department and non-Federal uses of the lands, such as 
illegal dumping, landfills, mineral extraction operations, and 
pipelines. In these cases, the Government's responsibility derives 
solely from the fact that it is the current owner of the land. Wherever 
possible, the costs of clean-up will be recovered from responsible 
parties.
    The Department will recognize the potential liability under CERCLA 
for other environmental cleanup costs in its fiscal year 1997 audited 
financial statements in accordance with standards recently promulgated 
by the Federal Accounting Standards Advisory Board. There is no current 
estimate of the dollar amount of this liability.
    The Department of Energy produces a report called the Baseline 
Environmental Management Report that gives Congress important estimates 
on out-year costs and timetables for addressing hazardous material 
contaminations. As you probably know, cleanup costs are expected to run 
into the billions for the Department of Energy.
    Question. Does Interior have any similar information available? 
When does the Department believe it will have completed its inventory 
of contaminated sites?
    Answer. Both the Department and the General Accounting Office (GAO) 
are reviewing existing inventory data to ascertain the Department's 
status with regard to potential CERCLA liability. It is understood that 
GAO will be completing their evaluation of the fiscal year 1997 
reporting sometime in fiscal year 1998. The Department has begun 
developing a financial accounting report of sites likely to result in 
liability to the Government based upon current information.
                           prescribed burning
    In a recent speech you described your intention to increase the use 
of prescribed burning for fire suppression. At the same time, EPA and 
other Federal agencies are forcing grass growers in the Pacific 
Northwest to eliminate the burning of their fields, ostensibly to 
protect air quality.
    Question. How do you reconcile these two positions?
    Answer. Prescribed fire is used in wildlands for fundamentally 
different reasons than agricultural burning, specifically grass 
growers. Grass growers have alternative treatments available in the 
management of their lands. In the wildlands, fire is a natural 
ecological process for maintaining and sustaining healthy ecosystems. 
There are no long-term alternatives to burning that accomplish the 
necessary ecological outcomes. Further, unplanned wildfires will 
eventually occur, and without periodic treatments with fire, those 
unplanned wildfires can be catastrophic for forest and rangelands and 
pose significant threats to public safety. In some locations and 
conditions harvesting of forest products, grazing, and mechanical 
removal of fuels will reduce the risks of catastrophic fire, 
particularly, in areas with exceptionally high levels of fuel. However, 
the continual build-up of brush, needles, and young unmerchantable 
dense stands is the primary source of fuels that result in high fire 
danger and that cause ecological imbalance. The use of periodic, low 
intensity fire (either from planned ignitions or from natural 
ignitions) reduces the risk of catastrophic fire and maintains healthy 
forests and ranges. Ponderosa pine stands, aspen stands, and the 
excellent big game environments that are a mixture of brush, grass, and 
forest are examples of the result of the natural role of fire.
    By contrast, agricultural burning such as that done by grass 
growers is conducted as part of an economic activity or industrial 
process and has alternatives. Agricultural burning is not conducted to 
maintain and sustain natural forest and range systems.
    Nevertheless, burning in wildlands can produce high levels of smoke 
emissions that must be addressed in air quality programs. Since the 
wildland fuels will eventually burn anyway, smoke emissions are 
inevitable though not predictable as to exact time, place, and 
quantity. Use of planned ignitions can help reduce smoke emissions by 
setting the time and circumstances to take advantage of favorable 
atmospheric conditions and to avoid unfavorable conditions. Smoke 
management techniques are routinely applied and many States have smoke 
management programs to mitigate the effects of wildland burning. The 
Department is participating in an EPA-lead effort to work with land 
managing agencies and State regulatory authorities to develop better 
procedures to ensure that the public policy objectives of using fire to 
maintain healthy ecosystems and improving air quality can both be 
achieved.
    Some in the Forest Service have expressed the opinion that you are 
overselling the potential benefits and uses of prescribed fire, in 
large part because fuel loading in many parts of the country is too 
great to allow fire to be used safely without first conducting 
extensive thinning or salvage logging.
    Question. Any comment on this assessment?
    Answer. Fire is the only effective option in the long run to 
restore, maintain, and sustain healthy forests and rangelands. In some 
areas, especially near human developments and near unique natural 
resources, mechanical fuels removal may be the safest and most feasible 
initial treatment. In some cases, vegetation will have to be maintained 
by continued mechanical thinning; in others, prescribed fire can be 
used to maintain open stands and low fuel conditions that are first 
reestablished by mechanical treatments. Extensive stands of open 
ponderosa pine, mixed conifer, and other forests in which fires burned 
frequently under natural conditions have become too dense, and have 
been invaded by non-fire adapted and extremely flammable tree species. 
The fuel ladders created by these young trees have contributed to the 
increase in large, catastrophic wildfires in recent years. Other 
forests, such as the pinyon/juniper in the intermountain west, have 
also become more dense and have invaded areas that were once open 
grass/shrub lands or savanna of grass and scattered trees. Such stands 
would be candidates for mechanical thinning as an initial fuels 
treatment.
                           counter terrorism
    Department of the Interior agencies received emergency supplemental 
funding in fiscal year 1997 for counter terrorism activities.
    Question. Please provide for the record a description of how the 
various bureaus have spent, or plan to spend, these funds.
    Answer. In fiscal year 1997, the Congress appropriated emergency 
supplemental funding to FWS and the National Park Service (NPS) for 
operational and construction requirements to address counter terrorism 
and security concerns. The FWS received $1.5 million and NPS received 
$8.6 million for these activities.
    The FWS is using $1 million to purchase radios to upgrade the 
current law enforcement communication systems in order to comply with 
FCC standards and provide encryption capabilities resistant to 
unauthorized interceptions of transmissions. The remaining $500,000 is 
being expended to purchase and upgrade law enforcement computer systems 
to prevent unauthorized intrusions into law enforcement databases.
    The NPS has allocated their funding to four high profile park 
sites, including Mount Rushmore National Memorial, Jefferson National 
Expansion Memorial, Independence National Historical Park, and the 
Monument Core of the National Capital Region (Washington Monument, 
Jefferson and Lincoln Memorials, Vietnam Veterans Memorial, Lafayette 
Park, and the Ellipse), to implement security systems, acquire 
equipment, and hire staff to ensure that these likely targets of any 
terrorist activity are protected.
                           welfare initiative
    The President recently announced an initiative to increase hiring 
from welfare rolls for Federal positions.
    Question. How will this initiative impact the Department of the 
Interior?
    Answer. The Department of the Interior completely supports the 
President's initiative to move Americans off the welfare rolls and onto 
the work rolls. But the President did not ask agencies to create work 
or provide anything different to employees hired under this initiative. 
And we do not intend to.
    This initiative simply asks agencies to look at what positions they 
have available or anticipate having available that might possibly be 
filled with people who are coming off the welfare rolls--people who 
might have little or no skills. Given that directive, the Department of 
the Interior is turning to the welfare rolls as an additional 
recruitment source.
    This effort may require that some jobs be restructured. In our 
Welfare-to-Work Plan we have identified positions such as clerk, 
laborer, maintenance worker, teachers aide, that are normally filled at 
lower grades which can easily be restructured, if necessary, to allow 
applicants with limited skills to qualify.
    Since Veteran's preference and career transition regulations are 
still applicable, and since there were no special authorities or laws 
that would allow us to give any preference to welfare recipients, we 
view the welfare-to-work program as only a focused recruitment effort.
    Question. How many positions does the Department expect to fill in 
this manner in fiscal year 1997? fiscal year 1998?
    Answer. The Department has set goals for hiring 50 welfare 
recipients in fiscal year 1997 and 75 in fiscal year 1998. Given that 
the Department has approximately 70,000 employees and does a great deal 
of hiring of temporary employees, these are not significant numbers.
    Any training or support services provided to these employees will 
also be available to any other employee who has a similar need. For 
example, our Employee Assistance Program currently provides referrals 
for employees who have concerns such as family issues and credit 
problems. In fact, we see this focus on employing welfare recipients 
and the types of services that they might need, as a way of enhancing 
our quality of work life programs for all employees, which is a current 
focus in the Department.
    Question. Will this initiative have any impacts on program funding 
requirements?
    Answer. We do not anticipate the welfare-to-work initiative to have 
any impact on program funding. We see this as a positive step in 
leading by example and creating a better work environment for everyone 
who works for the Department of the Interior.
                       Bureau of Land Management
                     oil and gas management program
    The BLM proposes to reduce its Oil and Gas Management program by 
$500,000 and 7 FTEs in fiscal year 1998. The program request for 1998 
is $52.47 million and 803 FTEs. The reductions are modest, but they 
illustrate a turning away from extractive uses on the public lands. The 
reductions will result in the stoppage of low priority lease 
application processing in Alaska, Arizona, and Idaho.
    Question. Given all of the proposed increases in BLM programs, how 
do you justify these reductions in the oil and gas program?
    Answer. The reductions are based on sound business practices, i.e., 
we will continue to act on applications that provide the most promise 
of resulting in oil and gas production. Streamlining program activities 
will also save money and thus there will be no overall diminution of 
the oil and gas program.
    Even though these may be low priority lease applications, they 
still offer the hope of new discoveries that the Nation needs.
    Question. How does the reduction of oil and gas leasing 
opportunities on public lands help the Nation's growing dependence on 
imported oil?
    Answer. We believe that leasing opportunities on public lands will 
not be reduced. The number of applications received for lands in 
Alaska, Arizona, and Idaho is extremely small. In some years we receive 
none. These applications are expensive to process. By focusing on areas 
of higher potential the public is well served.
    I know that the Interstate Oil and Gas Compact Commission (IOGCC) 
is negotiating with the oil producing States concerning transfer of 
certain oil and gas lease management functions to the States.
    Question. When do you expect to bring this effort to closure? Will 
the Department require legislation to implement elements of any such 
transfer? If so, when do you expect to transmit such legislation to the 
Congress? Do you expect savings as a result of this transfer?
    Answer. At a May 2, 1997, meeting with the IOGCC there was 
agreement reached to form a steering committee made up of BLM and State 
representatives which would work to reduce or eliminate duplication, 
streamline processes, create efficiency, reduce regulatory burdens on 
operators, and reduce the cost to the taxpayer. At the same meeting, it 
was agreed that within 90 days (by August 2, 1997) any State wishing to 
request a delegation would submit a complete proposal or letter 
declining to participate. States would still be able to request 
delegations under the provisions of the Federal Oil and Gas Royalty 
Management Act (FOGRMA) of 1982.
                         wild and scenic rivers
    The House Report accompanying the Fiscal Year 1995 Interior and 
Related Agencies Appropriations Act directed BLM and the Forest Service 
to prepare a report on funding for activities associated with wild and 
scenic rivers.
    Question. Was this report ever completed? If so, please transmit a 
copy of the original report and any updates to the Committee. If it was 
not completed, why not?
    Answer. House Report 103-551 accompanying the 1995 Department of 
the Interior and Related Agencies Appropriation Act directed BLM to 
report on: 1) the amount of money spent on Wild and Scenic River (WSR) 
studies and management plans in fiscal year 1994 and projected to be 
spent in fiscal year 1995; 2) the status of studies and management 
plans required by statue and the extent to which statutory obligations 
under the WSR Act could not be met by existing and planned funding; and 
3) the amount of funding necessary for fiscal year 1996 to complete WSR 
studies and management plans on time.
    The following report was completed in 1995.
    The BLM WSR program includes implementation of 33 management plans 
covering 2,022 miles of BLM administered rivers in the National WSR 
System. The BLM started monitoring specific WSR program expenditures in 
fiscal year 1995. As of January 30, 1995, BLM has spent $419,000 on the 
WSR program, which extrapolates to approximately $1.3 million for the 
entire fiscal year. Based on the consistency of the BLM WSR program, 
funding levels for fiscal year 1994 and fiscal year 1996 are assumed 
and projected to be approximately the same as those projected for 
fiscal year 1995.
    Section 5(d) of the WSR Act requires that BLM evaluate potentially 
eligible river segments in conjunction with land use planning, but the 
WSR Act does not specify a deadline for completion of this work.
    The BLM remains in compliance with the WSR Act and will continue to 
evaluate potential WSRs under its Resource Management Planning process. 
The fiscal year 1996 funding level for WSRs is consistent with BLM's 
proposed planning schedule.
    The information in that report is still correct. In addition, BLM 
is currently implementing the management plans that cover all 34 of the 
BLM administered rivers in the National WSR System. During the 
completion of Resource Management Plans (RMP) and/or amendments to 
them, BLM conducts evaluations of rivers and then makes recommendations 
regarding their suitability for designation as a WSR. The WSR Act does 
not specify a deadline for such evaluations.
    In fiscal year 1995 and 1996, BLM expended $1.9 million and $0.9 
million respectively, in administering the WSR Program. Expenditures 
for fiscal year 1997 are projected to be approximately $1 million.
             sale of the alaska power administration (apa)
    The 1995 Alaska Power Administration Asset Sale and Termination Act 
directs the Secretary of Energy to sell all APA assets, including two 
hydroelectric projects and related transmission facilities. The Act 
also requires other Federal agencies to assist in the sales and 
conveyances. I understand BLM and the Forest Service are directly 
involved in the land issues surrounding these sales.
    Question. Are sufficient funds requested in the President's fiscal 
year 1998 budget to complete all remaining tasks with respect to these 
sales?
    Answer. Yes, there are sufficient funds in the President's fiscal 
year 1998 Budget for BLM to complete its work related to these sales. 
These sales are scheduled to be completed in fiscal year 1998.
                                 helium
    With passage of the Helium Privatization Act, BLM should be able to 
reduce its number of FTEs by 23 positions in fiscal year 1998. However, 
BLM absorbs these FTEs and puts them into traditional programs. 
Congress passed the Helium Privatization Act in part to reduce the size 
of government.
    Question. Does the Department anticipate any savings, as Congress 
had intended?
    Answer. The President's Budget shows a direct savings of 23 FTEs 
and $7 million in the cost to operate the helium program. From 1996 to 
the end of fiscal year 1998, there will be a reduction of in excess of 
100 positions. During the phase-out period, large severance payment 
costs will be incurred in 1998, however, significant savings will be 
realized in future years as intended by the passage of the Helium 
Privatization Act.
              grand staircase-escalante national monument
    The very first thing BLM highlights in its overview is a 
justification for requesting $5 million of new budget authority to be 
used in the creation of the Grand Staircase-Escalante National 
Monument. This is added to the $1.6 million that BLM was already 
spending in this area. The creation of a national Monument is 
tantamount to the creation of a national park. It will draw a lot of 
visitors and it will continue to consume significant budget resources.
    Question. How are you going to keep this Monument from consuming 
ever-increasing amounts of the BLM budget?
    Answer. The BLM will handle proposed allocations for the Monument 
through the agency's normal budget process. By following customary 
budget procedures, BLM will consider funding for the Monument in the 
context of other resource management priorities. The Monument is a high 
priority for BLM. However, the agency recognizes that it must seek a 
balance in meeting the needs of the Monument as part of the BLM's 
overall mission and responsibilities.
    Question. What activities will have to be forgone in order to 
support the Monument, not only this year but in years to come?
    Answer. The BLM has requested an increase of $5 million in the 1998 
President's Budget. Once the 1998 funding levels for the Monument are 
established, future funding allocations for the Monument will occur 
through the normal budget process. The budget process serves to 
evaluate BLM's priorities and needs, as well as to present workload 
units to be accomplished to support those funding priorities and needs. 
As work is accomplished, or as priorities change, the budget request is 
modified to reflect the changes.
    When the Congress creates a national park, it does so with a 
recognition that it comes with long-term financial responsibilities.
    Question. How will the Department and BLM find ways to support the 
Monument without sacrificing the agency's multiple use 
responsibilities?
    Answer. The Monument encompasses public lands that were previously 
managed by BLM for multiple uses, and many of these same uses will 
continue within the Monument. Thus, the President's designation 
complements the BLM multiple-use mandate regarding activities such as 
livestock grazing and basic visitor services. Through the budget 
process, BLM has identified some Monument area activities for 
additional funding, including recreation and interpretation. These 
activities have been underfunded in the past, and BLM would have 
recommended increases regardless of the Monument's designation. 
Interior and BLM identify new funding needs through the normal budget 
process, which considers the long-term needs of the entire Department.
    Question. How much of the $5 million of new request will go to 
local communities?
    Answer. In 1997, through a cooperative agreement BLM has agreed to 
provide up to $200,000 to Kane County to facilitate its participation 
in the Monument planning process. Although Garfield County initially 
refused any planning assistance, they have just agreed to enter into 
their own cooperative agreement with BLM that would provide $50,000 to 
facilitate participation in the planning for the final months of fiscal 
year 1997. In addition, BLM previously agreed to extend cooperative 
agreements to both counties during the 1997 field season for law 
enforcement, search and rescue, and trash removal costs associated with 
the Monument. Subject to Congressional appropriation, BLM is also 
exploring further cooperative funding options with Kane and Garfield 
Counties regarding law enforcement, search and rescue, trash removal 
and planning for fiscal year 1998. In addition, BLM plans to share 
various resources with Kane and Garfield counties, which will result in 
significant savings for the counties. These resources include 
communications facilities for law enforcement, road signs, and 
Geographic Information Systems (GIS) databases. The BLM estimates the 
value of these shared resources as follows: GIS ($400,000); road signs 
($50,000); visitor information materials that address dangers 
associated with visiting the Monument ($10,000); road maintenance 
($50,000); law enforcement ($30,000); sanitation ($60,000); and search 
and rescue access to communications towers and other equipment 
($100,000).
                          blm law enforcement
    The BLM is requesting an additional $2.054 million and 7 FTEs in 
its law enforcement program.
    Question. How much of this additional funding did BLM intend to use 
in its effort to consolidate its various law enforcement regulations, 
as it had announced?
    Answer. None of the additional funding is to be used to consolidate 
the various law enforcement regulations. The $2.054 million in 
additional funding is intended to reinvigorate the BLM drug enforcement 
efforts within existing BLM law enforcement authority and is being done 
at the direction of the Office of National Drug Control Policy (ONDCP).
    Question. How much was the consolidation going to cost?
    Answer. The proposed consolidation of the BLM law enforcement 
regulations would have had no cost impact.
    In response to criticism of the BLM plan to consolidate its law 
enforcement regulations, you announced on March 11 that BLM would 
shelve its plan to consolidate its various law enforcement regulations.
    Question. Does BLM still need the entire additional $2.054 million 
for law enforcement or can we use that money somewhere else?
    Answer. Yes, BLM does need the additional $2.054 million increase 
in the law enforcement budget to conduct an effective drug enforcement 
program to suppress marijuana cultivation and methamphetamine 
production activities that impact the public lands. The ONDCP has 
directed BLM to spend this additional funding in support of the 
national drug strategy to reduce all domestic drug production and 
availability on public land.
                       payments in lieu of taxes
    The BLM budget proposes a reduction of $12 million in the Payment 
In Lieu of Taxes (PILT) program. The PILT program is the money the 
Federal Government pays to local governments to compensate those units 
of government for the loss of taxes that they would otherwise collect 
if the land were in private hands. The PILT payments were $113.5 
million in 1996, $113.5 million in 1997, and are proposed at $101.5 
million in 1998.
    Question. Why do you propose a reduction in payments to local units 
of government that cannot tax the Federal Government for its occupancy 
of lands within States at a time when the Administration seems to be 
re-doubling its efforts to acquire lands--the Headwaters Forest, Grand 
Staircase-Escalante National Monument, and Crown Butte mining land 
comes to mind?
    Answer. The BLM budget request for PILT is the same as its proposal 
for 1997; Congress appropriated an additional $12 million above the 
1997 requested level.
    Question. Do you think that local units of government are entitled 
to PILT payments?
    Answer. The BLM supports and administers the PILT program that 
makes payments to units of local government that contain certain 
Federally owned lands within their boundaries (the Federal lands that 
qualify include not just BLM lands but lands in the National Park 
System, the National Forest System, National Wildlife Reserve Areas, 
plus a variety of other categories). The amount of payment is 
determined by several codified formulas and is designed to supplement 
other Federal land revenue sharing payments that county governments may 
be receiving.
    Question. How do you explain to local governments that BLM needs 
the money to expand existing programs more than they need it for their 
local needs? What do you propose to use the money for rather than 
making PILT payments?
    Answer. The BLM 1998 budget proposal for PILT is the same as its 
proposal for 1997. However, in 1997 Congress appropriated an additional 
$12 million above the request level. The Administration's commitment to 
deficit reduction has made it impossible to seek budget increases for 
all programs.
    Question. How does the Department intend to deal with the addition 
of land in the unorganized boroughs of Alaska, which accounts for 60 
percent of Alaska?
    Answer. For many years after enactment of the PILT program by 
Congress in 1976, BLM interpreted the law to mean that unorganized 
boroughs in Alaska, and organized cities within them, did not qualify 
for PILT payments. However, this interpretation did not take into 
account the organized cites with the borough which qualify separately 
under the PILT statute. In response to a request from the BLM Director 
in late 1993, the Solicitor's Office rendered an opinion in July 1994 
that organized cities located within unorganized boroughs do qualify 
for PILT payments. Thereafter, BLM started including these organized 
cities in their PILT calculations.
    In November 1996, Public Law 104-333 was enacted, which amended the 
PILT Act's definition of unit of general local government to include 
unorganized Alaska boroughs as eligible for PILT payments. In 
accordance with this recent amendment, BLM will add the census areas 
contained in the unorganized borough to the units of local government 
previously determined eligible for PILT payments.
    Question. How much additional PILT money will Alaska be entitled to 
with this addition?
    Answer. As we testified before the Senate Energy and Natural 
Resources Committee on June 11, 1996, we estimate that this will 
increase the total PILT payments to the State of Alaska by 
approximately $1.5 to $2.5 million, based upon current appropriated 
levels of $113.5 million.
    The unorganized borough of Alaska was added to the list of eligible 
local governments at the end of the last Congress--long before the 
Department put together its budget request for fiscal year 1998.
    Question. Why doesn't the Department budget request reflect this 
additional need?
    Answer. The Department's June 11, 1996, testimony clearly stated 
that we did not oppose adding the unorganized borough to the list of 
units of local governments eligible for PILT payments, but would not 
support expanding the scope of the PILT program in such a way as to 
lead to an increased need for annual appropriations at the expense of 
higher priorities.
    The PILT payments are allocated according to a formula set by law, 
from a fixed pool of funds appropriated by Congress. This fixed pool 
means that, within the appropriated funds, an enlargement of eligible 
lands in one State will diminish the entitlements of other States and 
local governments.
    Payments to each unit of general local government are based on the 
number of acres of Federal entitlement land within each unit of general 
local government. Federal entitlement land is defined to include, among 
others, lands within the National Forest and National Park systems, 
lands managed by BLM, and lands affected by Federal water resource 
development projects.
    For payments under Section 6902 of the PILT Act (payments for 
Federal lands in the National Forest System and the National Park 
system, lands administered by BLM, lands in Federal water resource 
projects, dredge areas maintained by the Corps of Engineers, inactive 
and semi-active Army installations, and some lands donated to the 
Federal Government), the number of acres of Federal entitlement land is 
multiplied by one of two formulae, whichever one provides the largest 
amount of PILT payments for each unit of general local government. 
Payments under either alternative are subject to population payment 
ceilings for each unit of general government eligible to receive 
payments as the principal provider of government services under Section 
6901(2)(A). The payment ceilings are based on a sliding scale, for last 
fiscal year they started at $77.33 per capita for populations of 5,000 
and under, and going to $30.83 per capita for populations of 50,000. 
These figures were then adjusted upward for inflation.
    The two formulae are:
  --(1) Multiply the number of acres of Federal entitlement land within 
        each qualified unit of general local government by $1.16 (in 
        fiscal year 1996). Compare this amount to the population 
        ceiling amount, and use whichever is lower. Subtract from that 
        total the amount of funds received by the unit of general local 
        government in the prior fiscal year under the following Federal 
        programs: the Department of Agriculture Appropriations Act of 
        May 23, 1908; the Enabling Act of Arizona and New Mexico of 
        June 20, 1910; the Mineral Lands Leasing Act of 1920; Section 
        17 of the Federal Power Act; the Taylor Grazing Act; the 
        Bankhead-Jones Farm Tenant Act; the Superior National Forest 
        State of Minnesota Act of June 22, 1948, as amended by the Act 
        of June 22, 1956; Section 6 of the Mineral Leasing Act for 
        Acquired Lands; Section 3 of the Material Disposal Act; and the 
        Refuge Revenue Sharing Act; as amended. Finally, prorate the 
        amount down to the appropriated amount of funds in the PILT 
        pool.
  --(2) Multiply the number of acres of Federal entitlement land by 16 
        cents. Compare this amount to the population ceiling amount. 
        Use whichever is lower. Unlike the first formula, do not deduct 
        for prior year payments. Finally, prorate the amount down to 
        the appropriated amount of funds in the PILT pool.
    Under the 1996 amendment, BLM will add the census areas contained 
in the unorganized borough to the list of units of general local 
government.
    Typically, there is only one recipient of PILT moneys in an area, 
because in most situations the PILT entitlement is to units of general 
local government that are the principal providers of governmental 
services within the area (e.g., police and fire protection). Thus, a 
county would not receive PILT moneys, if a city or township within that 
county were the principal provider of government services in that area.
    Only the Federal lands within the boundaries of the service area 
for that unit of general local government that is the principal 
provider of government services is considered in determining the PILT 
entitlement. In most instances, this results in counting most Federal 
lands that may be counted as entitlement lands under the statute, and 
in all instances it results in no double-counting of populations or 
lands. The exception to this rule has been Alaska's unorganized 
borough, where cities and townships to Section 6901(2)(A)(i), qualify 
under that subsection as units of general local government, but the 
boundaries of those cities do not encompass most of the Federal lands 
within the unorganized borough, and the unorganized borough does not 
qualify as unit of general local government under the statute because 
it does meet the criteria for a unit of general local government, e.g., 
it is not mentioned as a unit of general local government that may 
qualify for payments under the statute, and it does not in fact provide 
any government services as required under the statute.
    Senator Stevens' amendment does direct payments to be made to the 
State of Alaska for the unorganized borough, but it does not qualify 
the borough as a unit of general local government, and it does not 
disqualify organized cities within the borough as units of general 
local government. Thus, the organized cities within the unorganized 
borough remain eligible recipients under a separate provision of the 
PILT statute for a separate PILT payment based on entitlement lands 
within the boundaries of the area for which they are the principal 
providers of government services. And that is how BLM is administering 
PILT under the 1996 amendment--it does not pay the unorganized borough 
and organized cities within the boroughs for the same Federal acres.
    Question. I understand that since the unorganized borough of Alaska 
was made eligible for PILT in the last days of the last Congress, BLM's 
regional solicitor in Alaska has either produced or found a previously-
produced document that cuts against some of the work that Senator 
Stevens accomplished with the amendment to the PILT Act.
    Answer. The Alaska Regional Solicitor's office did not find any 
previously produced document that cuts against the Stevens Amendment to 
the PILT Act. The history of that office's addressing this issue is 
recounted in the answer above.
    The first opinion was provided to BLM by the Regional Solicitor on 
July 14, 1994. It stated that under the PILT law in effect at that 
time, the unorganized borough was not eligible for PILT payments, but 
organized cities within the unorganized borough which serve as the 
principle providers of governmental services that have PILT entitlement 
land within their jurisdiction do qualify for PILT payments. This 
opinion in fact maximized the number of eligible populations that could 
receive PILT moneys within unorganized boroughs under the PILT law as 
it existed prior to the enactment of Senator Stevens' amendment.
    In light of the 1996 amendment to the PILT Act, BLM asked the 
Regional Solicitor to assess its effect. In response, the Solicitor's 
Office pointed out that, even with the 1996 amendment, the statute 
still provided that payments are to be made to cities which are units 
of general local government within the unorganized borough. The 
Solicitor's Office also pointed out that the 1996 amendment for the 
first time made lands in the unorganized borough eligible for PILT 
payments. Finally, the Solicitor's Office concluded that separate 
payments must be made for the qualifying cities based on their 
populations and entitlement lands within such cities, and for the 
unorganized borough based on the population and entitlement lands 
outside of qualifying cities.
    This conclusion is consistent with how BLM administers the PILT 
program outside of Alaska, and is also consistent with what we discern 
to be Senator Stevens' purpose in introducing the amendment. 
Specifically, in proposing the amendment, Senator Stevens stated:
    It is a matter of fairness--60 percent of the Federal lands in 
Alaska are not included under current PILT calculations. Alaska is the 
only State not fully compensated for all of its Federal lands. Even the 
territories and the District of Columbia are fully compensated. (141 
Cong. Rec. S9517-02, *S9534).
    This statement reflects the Senator's concern to include Federal 
lands in unorganized boroughs--and outside of organized cities--in 
current PILT calculations. It does not suggest that double-counting of 
Federal land within the boundaries of unorganized boroughs and also 
within the boundaries of organized cities was the intent of the 
amendment.
    Question. My staff has been told by BLM staff that BLM, subsequent 
to working with Senator Stevens' staff on the amendment language, 
``found'' information that suggests that small population centers 
within the unorganized borough were eligible for PILT payments without 
the amendment and should have been receiving payments.
    Answer. While BLM did testify at the committee hearing on this 
bill, and did not oppose it, BLM did not work on the actual amendment 
language. The Departmental witness who testified on this amendment 
specifically noted that ``[u]nder current law, Federal entitlement land 
in the unorganized borough located outside the boundaries of an 
organized city does not qualify for PILT payments.'' (Testimony of Gwen 
Mason, Senate Energy and Natural Resources Committee, June 11, 1996, 
emphasis added.) This clearly reflects that BLM was aware, and had 
informed Congress that organized cities fell within the already 
existing PILT entitlement for units of general local government.
    Immediately upon receipt of the July 1994 opinion, BLM began 
gathering the necessary data to include the organized cities in the 
units of general local government eligible for PILT payments. Since 
payments are based on data from the previous year, the first year BLM 
was able to make those payments was 1996, based on 1995 data, and those 
payments were made.
    Question. My staff has also been told by BLM that it is possible 
that BLM's position will be that a mistake was made for many years but 
that it will not make back payments for moneys not paid. At the same 
time, BLM will not allow the populations of these ``pocket'' 
communities within the unorganized borough to be counted in the total 
population of the unorganized borough that is now eligible for PILT.
    Answer. As indicated in the previous answer, as soon as the 
Regional Solicitor advised BLM that the organized cities were eligible 
for PILT payments, BLM added them to the list, the data was gathered, 
and they were paid. The BLM did not attempt to gather data from 
previous years to make back payments. The BLM in good faith 
administered the law in one way until advised by the Solicitor's Office 
the law was otherwise, and there is no provision for back-payments to 
correct errors without express authority from Congress.
    The question of whether BLM should double-count Federal acreage in 
organized cities within unorganized boroughs for purposes of PILT 
payments is a separate question. We believe the plain text of the 1996 
amendment, as well as the intent of its sponsor, was not to authorize 
such double-counting, but instead was only to allow Federal land 
outside of organized cities in unorganized boroughs to be counted for 
the first time.
    As you know, the PILT formula considers both acreage and 
population. In a State like Alaska, and particularly in sparsely 
populated regions like the unorganized borough, every body counts.
    Question. Are you aware of this memorandum? What is your opinion or 
that of Solicitor Leshy?
    Answer. Solicitor Leshy has reviewed both the 1994 and 1996 
Regional Solicitor's Opinions and agrees with their conclusions.
    Question. If BLM failed to make payments as required or authorized 
under the law, will it make back payments to these communities in 
Alaska? Why or why not?
    Answer. Since there is no separate appropriation for back payments, 
the BLM is not able to make back payments.
    The BLM has refused to release the regional solicitor's memorandum 
to my staff or Senator Stevens' office.
    Question. When will you provide this opinion to the Committee for 
us to use as we consider the fiscal year 1998 budget for PILT?
    Answer. The opinion has been provided.
                            range management
    For fiscal year 1998, the BLM budget proposes a reduction of $1.6 
million dollars in range improvement activities. The 1996 authorization 
was $9.1 million, the 1997 authorization is $9.1 million, and the 
request for 1998 is $7.5 million. The explanation for this reduction is 
an expected reduction in grazing receipts. According to the Public 
Rangelands Improvement Act (PRIA) of 1978, BLM should request the 
larger of $10 million or 50 percent of the grazing fees collected.
    Question. Given the requirements of PRIA, how can this reduction be 
justified, particularly in light of increases in other land management 
areas?
    Answer. The BLM 1998 request was based on a technical 
interpretation of what is available for this appropriation, which 
provided for 50 percent of the receipts projected for fiscal year 1997 
(half of $14.8 million) as opposed to the $10 million called for in 
PRIA.
    Quoting directly from the budget summary, ``The anticipated 
decreases in [range improvement activities] will have profound impacts 
on the BLM's ability to improve resource conditions on a landscape 
basis.''
    Question. Given this Administration's emphasis on environmental 
stewardship, how can you justify under-funding rangeland improvements? 
What do you say to the professional range management specialists in 
light of the fact that so many other land resource programs are 
proposed for increases?
    Answer. Based on the technical interpretation that 50 percent of 
the receipts (grazing fees) from permittees and lessees that graze 
livestock on public lands is available for this appropriation it was 
not under-funded. Efforts will be made to maintain the 1997 level of 
noxious weed management which is of major concern to Federal, State, 
and local governments as well as private land owners. This will be 
accomplished by deferring other types of range improvement projects 
such as fences.
                      wild horse and burro program
    In recent months, Interior has been criticized for its Wild Horse 
and Burro program. There have been allegations of BLM negligence, even 
concealment, with respect to slaughter of wild horses from public 
rangelands in the West.
    Question. What is your response to these allegations?
    Answer. The BLM's policy is to maintain animals as a natural part 
of the range ecosystem. When necessary to protect both the health of 
the range and to maintain a thriving herd, BLM oversees gather 
operations to remove excess animals which are placed in our Adopt-a-
Horse or -Burro Program. We treat all gathered equines humanely, 
assuring they receive veterinary care and are well fed and cared for 
prior to adoption. We also assign each animal a unique number--a freeze 
mark--which is useful in tracking that animal throughout its stay at a 
preparation center, its shipment to an adoption center, and its 
adoption to a private individual. This identifier is entered into a 
computer which can be queried by any BLM wild horse and burro office 
for tracking animals and answering questions posed by curious adopters.
    The BLM is committed to doing all that it can to ensure that wild 
horses are placed in homes that will provide humane care. The BLM 
screens individuals to assure they understand the financial 
responsibility and need for proper facilities to care for an animal; 
such as corrals and shelters. Under recently enacted regulations, BLM 
will begin offering some adoptable horses on a competitive bidding 
basis. When not using competitive bidding, BLM will charge a uniform 
base fee of $125 per animal. The competitive bidding process is 
expected to result in higher adoption fees for some animals, which will 
help defray expenses for the program. Higher adopter investment costs 
should also further diminish what minimal profiteering incentives may 
exist for adopting horses and sending them to slaughter after title.
    Title may be received for no more than four animals in a year. The 
majority of adopters adopt only two animals. The adopted wild horse or 
burro remains the property of the Federal Government for one year. 
While the title to the animal is retained by the Federal Government, 
BLM regulations prohibit the sale of the animal, prohibit use as rodeo 
stock, and prohibit neglectful treatment of the animal. This one-year 
waiting period serves as a deterrent to people who want to immediately 
profit by selling their untitled animals. The cost of caring for an 
animal for a year runs an average of $1,000 or higher, depending on the 
part of the country, making it economically impractical for people to 
profit after title is issued. Despite these safeguards, some wild 
horses that are titled and are no longer under Federal protection are 
sent to slaughterhouses. However, none of the animals cited in the 
articles were Federally protected.
    The BLM often performs compliance checks prior to passage of title 
to an animal. Compliance checks are done on all complaints; random 
checks are performed on other adopters. Title is approved only after 
inspection by a veterinarian, humane officer, or other similarly 
qualified individual. About 150,000 wild horses and burros have been 
placed in private ownership since the program began. In 1996, BLM 
conducted almost 3,000 random checks and responded to over 200 horse 
neglect complaints which led to the repossession of 52 horses and the 
reassignment of 317 horses to other adopters.
    Question. Is the Department investigating the allegations?
    Answer. In 1993, the BLM began implementation of the Strategic Plan 
for the Management of Wild Horses and Burros on Public Lands. This plan 
established goals which address wild free-roaming horses and burros as 
important and perpetual components of the rangeland ecosystem. The plan 
also ensures humane care and protection for those animals removed from 
the range and placed into the adoption program. We continue to evaluate 
our performance. We have recently completed two such evaluations: The 
Wild Horse and Burro Program Emergency Evaluation Team, completed in 
January, 1997; and the Wild Horse and Burro Adoption Program Policy 
Analysis Team, completed in April, 1997. The recommendations from these 
two teams will result in improved herd management, healthier animals on 
the land, and increased protection for animals in the adoption program. 
In addition to these completed evaluations, we currently have several 
evaluations underway targeting improving our veterinary practices and 
monitoring of animal health on public lands. These evaluations are 
being conducted with the participation of representatives from the 
veterinary and scientific communities.
    Because allegations that BLM employees may have been involved in 
deliberate profit-taking from the sale of wild horses for slaughter, 
Assistant Secretary for Land and Minerals Management, Bob Armstrong, 
ordered an immediate investigation by BLM's law enforcement special 
investigators. In the course of the investigation, teams of law 
enforcement agents and wild horse experts were sent to eight horse 
slaughterhouses in the United States and one in Canada. With the 
cooperation and assistance of meat processing plant owners and 
managers, the teams reviewed data from the last two years. They found 
that about 266,000 horses were slaughtered during 1995 and 1996 and 
that less than one quarter of one percent, about 350 per year, were at 
any time wild, Federally protected, or managed by the BLM. In contrast, 
the wild horse adoption program adopts approximately 8,000 horses each 
year to qualified adopters.
    About a month ago, BLM announced that it is moving management of 
the Wild Horse and Burro Program from Reno, Nevada, to Washington, DC.
    Question. How many personnel transfers will this move entail?
    Answer. On February 10, 1997, the Acting Director of BLM reassigned 
responsibility for the wild horse and burro program from Nevada BLM to 
the BLM headquarters in Washington, DC. The existing wild horse and 
burro staff in Reno will not be moved but will remain in their present 
location and report directly to Washington rather than the State 
Director for Nevada. The purpose of this reorganization is to provide 
for personnel in the headquarters office with expertise in the wild 
horse and burro program. These personnel will be responsible for 
coordinating policy, communicating with the Congressional delegations, 
the media, and national level organizations interested in the welfare 
of wild horses and burros, and coordinating the national budget. The 
Wild Horse and Burro National Program office, located in Reno, Nevada, 
will remain in its current location and be responsible for coordinating 
all operational matters relative to the management of wild horses and 
burros. None of the Reno staff will be relocated to Washington.
    The reorganization will require that several additional staff be 
added to the Washington Office. One new position is presently being 
recruited for the Washington staff and two additional staff persons 
will also be recruited sometime in the future.
    Question. How much is this going to cost?
    Answer. The reassigning of responsibility of the Wild Horse and 
Burro Program from Reno, Nevada to Washington, D. C., and the 
additional three personnel will cost approximately $250,000 annually.
    Question. Will there be cost savings for the Government?
    Answer. Although it will cost BLM more to have this staff in 
Washington, they will be the contact point to provide increased 
coordination with Congress, other agencies, and National Wild Horse and 
Burro advocacy groups.
    Question. Was this transfer in response to criticism of BLM 
mismanagement of the Wild Horse and Burro Program?
    Answer. The reassigning of responsibility for the wild horse and 
burro program from Nevada to Washington, D. C., was the result of a 
recommendation made by The Wild Horse and Burro Program Emergency 
Evaluation Team. This team was established in August 1996 as a result 
of the drought conditions experienced in Nevada last summer. The Team's 
recommendation for reorganizing the program was based on the need to 
improve wild horse and burro program representation in Washington. The 
recommendation was not based on criticism presented in the recent 
Associated Press article and, in fact, the draft report presented the 
recommendation for reorganization prior to release of the news 
articles.
    Question. How does moving management from the public land region of 
the West to Washington, D.C. solve the problem?
    Answer. The reorganization will allow the wild horse and burro 
program to have a stronger presence in the headquarters office and a 
stronger voice in coordination with other programs. Improved 
communication with the BLM Directorate will aid in resolving many of 
the recurring issues facing the program.
    Question. Is the transfer of management responsibilities temporary 
or permanent?
    Answer. This reorganization of the program is expected to be 
permanent.
    Question. What kind of assurances can you provide the members of 
this Committee that transfer of the management of the Wild Horse and 
Burro Program from Reno to inside the beltway, along with an increased 
budget, will solve the problems that exist within the Program?
    Answer. The BLM is committed at the highest level to improving our 
management and protection of wild horses and burros. We are continually 
evaluating the performance of the Wild Horse and Burro Program. We have 
recently completed two such evaluations: The Wild Horse and Burro 
Program Emergency Evaluation Team (Pierson Report), completed in 
January 1997; and the Wild Horse and Burro Adoption Program Policy 
Analysis Team (Culp Report), completed in April 1997. The Acting 
Director has accepted the recommendations from these reports. The 
Pierson report found that while operational parts of the Wild Horse and 
Burro Program such as scheduling and coordination of animal gathers and 
adoptions had improved, coordination with other closely related BLM 
programs such as Rangeland Management, Wildlife Management, and 
Watershed Management was disconnected under the old organization. It 
also found that the public who have a high degree of interest in Wild 
Horse and Burro management (ranchers and wild horse advocates) thought 
they had lost the ability to make their views known to the highest 
levels of BLM management. We believe that the new organization will 
remedy those problems while retaining the best aspects of the old 
organization. Other recommendations from these two teams will result in 
improved herd management, healthier animals on the land, and increased 
protection for animals in the adoption program. The increased funding 
is necessary to implement these recommendations. In addition to these 
completed evaluations, we currently have several evaluations underway 
targeting improving our veterinary practices and monitoring of animal 
health on public lands. These evaluations are being conducted with the 
participation of representatives from the veterinary and scientific 
communities.
    The Wild Horse and Burro Program is about a $16 million program 
annually. For fiscal year 1998, the Department's request includes a $2, 
443,000 increase.
    Question. The request was put together before announcement of the 
move of the program management to D.C. How much of the increase will be 
used for this move?
    Answer. The reassigning of responsibility of the Wild Horse and 
Burro Program from Reno, Nevada to Washington, D. C., and the 
additional three personnel will cost approximately $250,000 annually.
    The budget justifications indicate that it is BLM's goal to inspect 
a minimum of five percent of untitled wild horses and burros which have 
been adopted under the program.
    Question. Is this a sufficient goal, given the criticism and 
allegations surrounding the long-term outcome for the animals?
    Answer. One of the recommendations made in the Wild Horse and Burro 
Adoption Program Policy Analysis Team Report is to increase on-site 
compliance inspections to assure statistically that 95 percent of 
untitled animals within the last five years are being properly cared 
for. However, to accomplish this goal, an additional $1.1 million 
dollars will be needed.
    The BLM charges $125 to adopt a wild horse and $75 to adopt a 
burro. Your budget request indicates that the Department is considering 
increased adoption fees to offset the costs of the program.
    Question. What is the status of these considerations?
    Answer. In March 1997, the final rule was published in the Federal 
Register which established a minimum adoption fee for all wild horses 
and burros at $125. This new rule also allows for the competitive 
bidding of animals. We are conducting five pilot competitive fee 
adoptions in different regions of the country to evaluate different 
bidding procedures and to gauge public perception of the process.
    We have completed three of the pilots and are very pleased with the 
initial results. The public is very supportive of the competitive 
bidding fee structure, the adoptions take less time and thus cost less 
to conduct, and the average adoption fee has been above the minimum 
$125. Based on pilot events using this competitive bidding process, the 
average adoption fee for a wild horse or burro has been approximately 
$177 with some animals adopting for over $400. After conducting the 
five pilot events, BLM issued its policy in July 1997, on procedures 
for conducting a competitive bid adoption nationwide.
    Question. What other options are being considered?
    Answer. The Wild Horse and Burro Adoption Program Policy Analysis 
Team Report recommended evaluation of a security deposit each adopter 
would provide to BLM. The deposit would be returned to the adopter upon 
successfully caring for the animal for a period of one year and 
receiving title. Failure to properly care for the animal or failure to 
receive title would forfeit the deposit. We are still evaluating 
whether holding these funds would be cost beneficial to the Government. 
Implementing this recommendation would require a change to the 
regulations.
    Question. Would you need legislation?
    Answer. The recommendations from the Wild Horse and Burro Program 
Emergency Evaluation Team and the Wild Horse and Burro Adoption Program 
Policy Analysis Team were made within the parameters of the existing 
law. No new legislation is being proposed at this time.
                                 mining
    Taking out a $50,000 request for use in funding the Grand 
Staircase-Escalante Monument, the request for coal management is flat 
($5.071 million and 78 FTEs). I note with some interest that BLM is not 
asking for any more money for its coal program.
    Question. Given the President's request for funding increases in 
all the surface programs, do the reductions in oil and gas management 
and the flat funding for coal management suggest that the President is 
turning away from energy development on public lands?
    Answer. Energy development on public lands is an important source 
of the Nation's energy supply. In preparing the budget, the 
Administration had to make difficult choices between increases and 
decreases for various programs. Other BLM programs received increases 
because the Administration believes that the needs are greater in those 
programs. We believe that adequate funds are provided to support 
exploration, development, and production of energy resources from 
public lands.
    Question. Do you believe that the public lands are capable of 
making a contribution to the Nation's energy needs? If so, how does the 
BLM budget request reflect the agency's attitude toward energy 
development on public lands?
    Answer. The BLM lands provide approximately five percent of 
domestic oil and gas production, virtually all the geothermal 
production, and about 35 percent of coal production. As stated 
previously, the budget contains adequate funds to support exploration, 
development, and production of energy resources from public lands.
    The budget assumes that royalties will be available from hardrock 
mining operations to fund reclamation of abandoned mine sites. However, 
activities to remediate contamination from hazardous substances at mine 
sites is already governed to a substantial degree by the Superfund law. 
Under that statute, Interior has the same responsibilities to 
investigate and clean up releases of hazardous materials as a private 
party.
    Question. Could you describe how you intend to have the royalties 
in the Abandoned Mine Land Fund used, and how those actions will relate 
to Superfund cleanups?
    Answer. The Administration has not proposed creation of a fund for 
reclamation of abandoned hardrock mine sites as part of the fiscal year 
1998 budget process.
    Legislation to date has limited Interior's ability to use royalties 
in the abandoned mine fund only if a hazardous substance release has 
been ``listed'' on the National Priorities List (NPL). But, as we know, 
Superfund liability attaches for a release irrespective of whether the 
site achieves NPL status. Other Federal agencies address many Superfund 
sites that are not on the NPL.
    Question. If royalties in the AML Fund are used to respond to 
releases of hazardous substances governed by Superfund, would that make 
the royalty a new category of Superfund tax, similar to what is levied 
on the petrochemical industry?
    Answer. The Administration has not proposed creation of a fund for 
reclamation of abandoned hardrock mine sites as part of the fiscal year 
1998 budget process.
                              ward valley
    The Federal land sale for the Ward Valley site was approved by your 
predecessor in 1993. Studies were completed, more studies were ordered, 
and today, we are no closer to completing the land transfer than we 
were four years ago.
    In February 1996, Deputy Secretary Garamendi announced a second 
supplemental EIS and additional soil testing despite the California 
Department of Health Services' documentation that all the issues 
subject to the first supplemental EIS were addressed on the record. The 
State has announced it is ready to move ahead with some additional soil 
testing recommended by the National Academy of Sciences but has not had 
access to the site by your Department to conduct the tests. Instead, as 
I understand it, BLM is spending $1.7 million in fiscal year 1997 funds 
to duplicate tests that the State has said it is responsible for.
    The Department of the Interior has undertaken activities for a 
supplemental EIS, field work, testing, and analysis in relation to 
California's licensed low-level radioactive waste facility at Ward 
Valley. In responses to questions posed by a House Committee, the 
Department maintained that the funding for these activities were 
budgeted in BLM's fiscal year 1997 budget.
    Question. Where, precisely, were these funds identified in the 
fiscal year 1997 budget for a supplemental EIS at Ward Valley?
    Answer. Funding for Ward Valley and other land transfer or exchange 
proposals is contained in the Realty and Ownership Management Activity 
in the Management of Lands and Resources Appropriation and in the 
Acquisition Management Activity in the Land Acquisition Appropriation. 
However, Ward Valley is not specifically mentioned by name. Congress 
has provided BLM with the flexibility to work on the highest priority 
lands issues recognizing that they generally take several years to 
complete. Anywhere along the process issues can arise that could 
modify, delay, or terminate a realty action. If a specific lands action 
were delayed, BLM would proceed on to the next highest priority 
project.
    Question. What amount was budgeted?
    Answer. The Land and Realty Subactivity received $28.6 million and 
the Acquisition Management Activity received $2.5 million in the fiscal 
year 1997 Appropriations Act.
    Question. Can you specify the precise funding requirements for the 
supplemental EIS, field work, testing, and analysis that you 
envisioned? How could these items be budgeted and included in the 
fiscal year 1997 budget submission when the announcement of the 
supplemental EIS and additional testing was not made until February 15, 
1997?
    Answer. Costs for fiscal year 1997 as of May 1997 are listed below:

Funding requirements for supplemental EIS, field work, testing, and 
analysis

        Work                                                   Estimated

Prepare SEIS..................................................  $427,000
Prepare protocol for field testing............................    63,000
Conduct field testing (drilling for tritium)..................   870,000
Laboratory analysis of testing materials......................   150,000
Prepare report on field testing and laboratory analysis.......    40,000
Independent review of laboratory analysis and report 
    preparation...............................................    40,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total................................................... 1,590,000

    The announcement of the supplemental EIS and additional testing was 
made by the Deputy Secretary on February 15, 1996. The budget estimates 
were developed beginning in June of 1996 in consultation with personnel 
from BLM, the U.S. Geological Survey, Bureau of Reclamation (BOR), 
National Academy of Science, and the Interior Solicitor. The 
supplemental EIS contract was awarded on May 15, 1997.
    The scientific contracts for developing the testing protocol were 
awarded on April 21, 1997.
    The amounts required for laboratory analysis and field work are 
uncertain. The Department of Energy has received a request from the 
State of California to fund this effort. Interior is currently 
discussing with the Department of Energy and the State of California on 
how a joint testing effort might work.
    Question. Have any reprogrammings been sought for this purpose? How 
much is budgeted for these activities in fiscal year 1998 and where is 
it identified in the budget materials?
    Answer. The BLM and Department must complete arrangements with the 
State of California and the Department of Energy on funding 
responsibilities for the tritium drilling before specific decisions can 
be made on BLM funding needs and funding sources. The BLM will keep the 
Committee appraised of progress on this issue.
    The BLM has requested $29.4 million in the Land and Realty 
Subactivity in the fiscal year 1998 budget justification. Until funding 
arrangements are determined for the tritium testing it is impossible to 
know what funding requirements BLM may need for 1998.
    Question. Now that the State of California has agreed to perform 
the field testing, why is there a need for the Department of the 
Interior to seek funds for this purpose?
    Answer. In response to Governor Wilson's proposal for the State of 
California to conduct the testing unilaterally, Secretary Babbitt and 
Energy Secretary Pena outlined a joint Federal-State program on May 21, 
1997. The Departments of the Interior and Energy have held several 
meetings with the State of California. The Federal and State 
Governments are discussing how a joint tritium program would work. We 
continue to believe that a cooperative program will best serve the 
interests of both the State and Federal Governments, and will result in 
a credible test that is accurate, reliable, and objective.
    Question. Why is the Department spending additional Federal dollars 
to conduct another supplemental EIS when State documentation shows this 
is unnecessary?
    Answer. The Department is required under NEPA to prepare a 
supplemental EIS when ``there is significant new circumstances or 
information relevant to environmental concerns and bearing on the 
proposed action or its impacts; when the agency determines that the 
purposes of the Act will be furthered by doing so'' (40 CFR 1502.10 
(C)). In the May 17, 1996 Federal Register Notice of Intent, BLM 
identified nine new circumstances or information relating to the 
proposal or its impacts. During the subsequent scoping period, 
approximately 800 public comments provided further evidence of the need 
for the supplemental EIS. Such public concern is ongoing. The 
Department has also consulted with the Council for Environmental 
Quality confirming the need for a Supplemental EIS.
    If the tests are so important, then I agree they should be 
conducted.
    Question. Why aren't California's regulators being allowed to 
conduct them?
    Answer. As stated in the answer above, the Department is currently 
discussing arrangements for a joint testing program with the State of 
California. Should the State desire to undertake unilateral testing, 
however, a land use permit must be obtained from BLM. The existing 
authorizations issued to the State since 1987 do not allow new surface 
disturbance. The State of California has informed BLM that it would 
apply for such a permit but, as yet, no application has been submitted. 
Since the site where the tests would be conducted is within critical 
desert tortoise habitat, consultation with FWS would be required in 
accordance with Section 7 of the Endangered Species Act (ESA) before 
any work could be authorized.
                      fair value in land exchanges
    As you know, Mr. Secretary, the Office of Inspector General (OIG) 
of the Department of the Interior also files a budget request with this 
Subcommittee. The mission of the Office of the Inspector General is to 
detect and prevent fraud, waste and abuse, and to promote economy, 
efficiency and effectiveness in the operations and activities of 
government agencies.
    In the fiscal year 1998 budget justifications, the Inspector 
General's Office described its 1996 audits and investigations. One of 
these operations was the audit of the BLM's Nevada Office land exchange 
activities. The OIG reported that the BLM Nevada State Office did not 
consistently follow land exchange regulations or procedures and did not 
ensure that fair and equal value was received in completing three of 
the four exchanges the OIG reviewed. As a result, the BLM exchanged 
public land for 2,461 acres of private land, valued at $2.7 million, 
that ``had no discernible mission-related purpose.'' In addition, ``the 
Government may have lost revenues of $4.4 million in completing three 
of the four exchanges reviewed.
    Question. The OIG reported that BLM officials agreed with the OIG's 
findings. The description of the investigation ended there. I would 
like to know what is happening with respect to the lost revenues of 
$4.4 million?
    Answer. The BLM generally agrees with the OIG report 
recommendations but we disagree with several of the specific report 
findings. In the Audit report, the OIG recommendations outline 
opportunities for BLM to enhance our land exchange program and we are 
proceeding ahead in implementing these recommendations. However, we do 
not feel that the OIG was correct in their assessment of lost revenues. 
The majority of the claimed $4.4 million in lost revenue resulted from 
one transaction involving a parcel encumbered by a right-of-way for a 
flood control structure. We feel the value established by BLM for this 
parcel was accurate, given the information available to the BLM 
regarding the City of Las Vegas' intended use and need for the right-
of-way. Our response to the Draft Audit Report on Nevada Land Exchange 
Activities (pages 28 through 35 of the final Audit report, issued July, 
1996) provides a more detailed discussion of the report findings.
    Question. Can you tell us why BLM acquired 2,461 private acres that 
had no mission-related purpose?
    Answer. The 2,461 acres referenced were acquired to provide habitat 
and watershed protection for the woundfin, the Virgin River chub, and 
desert tortoise (all threatened or endangered species). The 2,461 acres 
were evaluated by qualified wildlife biologists and it was determined 
that these acquisitions would benefit these species and were consistent 
with the mission of the Department and with applicable land use plans.
                       Fish and Wildlife Service
                       arid lands ecology reserve
    The Fish and Wildlife Service and the Department of Energy have 
been negotiating a Memorandum of Understanding (MOU) for management of 
the Arid Lands Ecology (ALE) Reserve at the Hanford site in Washington 
State.
    Question. What is the status of the MOU? When will the MOU be 
completed? What role will the MOU likely establish for FWS in 
management of the Reserve?
    Answer. The FWS and the Department of Energy have completed the 
Memorandum of Understanding. The FWS will have full management 
responsibility subject to continued access by the Department of Energy 
and its contractors to pursue ongoing research programs and operation 
of communication facilities. The FWS will operate the ALE in accordance 
with the present Department of Energy-approved Facility Management Plan 
and will develop its own management plan with public participation 
within 36 months. It is expected that FWS will manage the ALE as a 
Research Natural Area with emphasis on research, environmental 
education, and interpretation. Other operating functions may be 
conducted through partnerships.
    Question. Is funding available in fiscal year 1997 to complete and 
execute the MOU? Are funds built into the fiscal year 1998 budget for 
this purpose? If so, how much and within what activity? If not, how 
much would be required in fiscal year 1998, for what purposes, and in 
what budget activity/subactivity?
    Answer. Since 1971, FWS has funded its operation of Saddle Mountain 
National Wildlife Refuge and its related Hanford coordination 
activities, including initial administration of the ALE, as part of the 
Columbia National Wildlife Refuge Complex. Under the ALE MOU, the 
Department of Energy is providing $300,000 to cover the FWS management 
of the Hanford site.
                            okefenokee swamp
    I understand you recently visited the Okefenokee Swamp to announce 
your opposition to a proposed titanium mine on the border of the 
refuge. I don't know enough about the project to know whether the mine 
itself is appropriate, but it does raise a concern.
    Question. Is it possible the Administration will propose a 
Headwaters type exchange in this instance?
    Answer. The Administration does not plan a Headwaters type land 
exchange in this instance.
                              space costs
    The budget request notes a slight increase in rental payments to 
GSA resulting from changes in rates.
    Question. How have Service rental payments to GSA changed over the 
past three fiscal years? How has the amount of actual space rented 
changed over the past three years?
    Answer. During fiscal year 1995, FWS rental payments to GSA totaled 
$25.5 million. In fiscal year 1996, the FWS's rental payments to GSA 
totaled $27.3 million. fiscal year 1997 payments to GSA are projected 
to be $27.5 million. In this three-year period, the FWS GSA rental 
costs have increased by almost $2 million or seven percent.
    In terms of the amount of space leased through GSA, the FWS fiscal 
year 1995 inventory totaled 2,099,341 square feet. Of this amount, 
993,426 square feet was designated as office space while the remaining 
1,105,915 was utilized for industrial, laboratory, and storage and 
parking purposes. In 1996, FWS leased a total of 2,177,033 square feet, 
of which 1,028,175 was office space and 1,148,858 was utilized for 
other purposes. In fiscal year 1997, FWS is leasing a total of 
2,249,531 square feet through GSA. The utilization of this space is 
broken down as follows: 1,040,271 is office space while 1,209,260 is 
used for industrial, laboratory, storage, and parking purposes.
    Over the past three years, the FWS inventory of total square 
footage has increased by 150,190 square feet. This is an overall 
increase of seven percent. The amount of office space has increased 
over this time period by 46,845 square feet or four percent, while non 
office space increased by 103,345 square feet or nine percent. These 
increases are primarily the result of increased appropriated funding 
for FWS field programs in the Pacific Northwest and Everglades. Both of 
these priority ecosystem-based initiatives have required additional 
biological staff to meet the Administration's goals.
                         endangered species act
    The Administration has requested an $11.4 million increase for FWS 
endangered species activities.
    Question. Will the Administration submit a legislative proposal to 
reauthorize the Endangered Species Act?
    Answer. The Administration is currently engaged in working 
cooperatively with the Senate Environment and Public Works Committee in 
aiding their efforts to reauthorize the Endangered Species Act. The 
Administration believes that the current ESA is an effective and 
flexible tool for maintaining biodiversity for current and future 
generations while at the same time allowing responsible economic 
development to proceed.
    Over the past several years, the Administration has designed a 
series of policies to improve the effectiveness of the ESA while 
enhancing its flexibility for businesses and private landowners. Full 
funding at the fiscal year 1998 President's Budget level of $78.8 
million for the endangered species program will allow these policies to 
continue.
    The Administration's March 6, 1995, announcement of ``Ten 
Principles For Federal Endangered Species Act Policy'' provides an 
overview of the Administration's approaches to minimize economic and 
social impacts on the economy, on private property and the affected 
public. The Ten Principles are:
    1. Base ESA decisions on sound and objective science.
    2. Minimize social and economic impacts.
    3. Provide quick, responsive answers and certainty to landowners.
    4. Treat landowners fairly and with consideration.
    5. Create incentives for landowners to conserve species.
    6. Make effective use of limited public and private resources by 
focusing on groups of species dependent on the same habitat.
    7. Prevent species from becoming endangered or threatened.
    8. Promptly recover and de-list threatened and endangered species.
    9. Promote efficiency and consistency.
    10. Provide State, tribal, and local governments with opportunities 
to play a greater role in carrying out the ESA.
    Candidate Conservation partnership efforts with Federal and State 
landowners and the private sector have been designed to avoid potential 
listings and litigation gridlock. Given the fiscal year 1998 
President's Budget request of $4.9 million for the candidate 
conservation program, FWS will be able to work on 292 actions.
    More is also being done with the use of Habitat Conservation Plans 
(HCP) to ease the regulatory burdens of the ESA on private landowners. 
The FWS estimates that it will work with 400 partners on HCPs given the 
fiscal year 1998 President's Budget request of $26.5 million for the 
consultation program thus demonstrating the flexibility of the ESA as 
it relates to the needs of private landowners. The Administration has 
produced concrete results with these HCPs. In the Pacific Northwest, 
the approved HCPs with State and private landowners cover over 4.2 
million acres in the States of Washington, Oregon, and California.
    Additional steps have been taken to provide landowners with 
certainty regarding potential future impacts of ESA actions. The ``no 
surprises'' policy assures private landowners participating in HCPs 
that no additional requirements will be imposed on plan participants 
for species covered by a properly functioning HCP.
    An HCP seeks to maintain adequate protection measures for species, 
while allowing for development activities. These plans often call for 
land protection or acquisition costs at the local level. The fiscal 
year 1998 President's Budget continues the Section 6 HCP land 
acquisition grants at $6 million to provide grants-to-States for land 
acquisition required at the local level as a result of the HCP planning 
effort.
    The ``safe harbor'' program encourages landowners to provide 
habitat for listed species. Under this program, private landowners with 
assistance from FWS or with other qualified Federal or State agencies 
develop a management program to be carried out on their lands for the 
benefit of listed species. Based on such a program, a safe harbor 
agreement is entered into by FWS and the landowner. The FWS, in turn, 
will issue the private landowner a permit for the future take of listed 
species above the existing baseline conditions at the time of the 
agreement. Over 37 agreements, mostly in the southeast and west, have 
been or are being developed. In the past year, for the Sandhill area of 
North Carolina alone, 18 non-Federal landowners have been given safe 
harbor agreements and it is anticipated that an additional 15 will be 
developed this year.
    The Administration has also developed an innovative way to avoid 
placing a significant and unnecessary regulatory restraint on thousands 
of private landowners in the Pacific Northwest hoping for 4(d) rule 
relief. Implementation of the 4(d) rule for the northern spotted owl 
would relieve certain prohibitions on private lands within the range of 
the owl. The FWS expects landowners will participate more readily in 
conservation and recovery activities because of the relief provided by 
the 4(d) rule.
    The budget justification indicates that funds for delistings and 
downlistings of species are within the Recovery activity rather than 
the Listing activity.
    Question. Does the Administration plan on delisting or downlisting 
any species in fiscal year 1998? Is the conduct of any delistings 
dependent upon the $3.8 million program increase for Recovery being 
funded? If held at the fiscal year 1997 level, would any delistings 
likely occur?
    Answer. Yes, the Administration plans to propose species for 
delisting and downlisting in fiscal year 1998. Up to 25 species will be 
evaluated for possible delisting in fiscal year 1998, provided the 
funding requested in the President's Budget is appropriated. The 
Administration strongly believes that the public is best served by 
removing species from the list of threatened and endangered species 
once recovery has been achieved. This results in a decreased cost and 
regulatory burden on the public and State and Federal agencies. To this 
end, FWS is working hard to recover as many species as possible in an 
expeditious manner. The FWS is responsible for both planning and 
implementing recovery actions for listed species, and accomplishing 
this recovery mission is contingent upon the funding in the fiscal year 
1998 President's Budget. The result of successful recovery planning and 
implementation is downlisting or delisting species. Therefore, given 
the increased recovery planning and implementation workload and the 
need to downlist and delist species, the $3.8 million increase is of 
critical importance to the FWS delisting program and to the extent to 
which FWS can engage in delisting and downlisting species in fiscal 
year 1998 is directly related to the increased funding.
    Question. Why were no delistings or downlistings performed in 
fiscal year 1997?
    Answer. Delisting and reclassification actions are currently funded 
under the ``listing'' line item in the FWS budget. Following the 
lifting of the listing moratorium in April 1996, significant program 
restart costs in terms of time and money were incurred by the listing 
program. The FWS developed listing program restart guidelines in fiscal 
year 1996 to help expedite the resulting backlog of proposed rules 
through the listing process. Due to the listing backlog FWS has at 
least twice the normal pending workload in the listing program in 
fiscal year 1997.
    Under the FWS Final Listing Priority Guidance for fiscal year 1997, 
published in the Federal Register on December 5, 1996, delisting 
activities were assigned to Tier 4, the lowest priority category for 
listing activities. The FWS assigned delistings the lowest priority 
because completing listing activities that provide protection for 
currently unprotected imperiled species is a higher priority and will 
best satisfy the intent of the Act.
    For fiscal year 1998, the delisting funding request is included 
with the recovery program budget. Because delisting is the ultimate 
goal and final step of the recovery process, the Department believes 
that it is more appropriate to include the delisting funding request 
with the recovery program.
    In order to delist a species, FWS must determine that it is no 
longer endangered or threatened based on surveys of its population 
size, recruitment, and habitat quality and quantity. The FWS is 
responsible for evaluating status survey results and coordinating 
conservation efforts with landowners and other Federal, State, and 
local agencies. Delisting and reclassification actions demonstrate the 
recovery successes of the ESA and remove regulatory burdens once they 
are no longer needed.
    Success stories, such as the reclassification of all bald eagles in 
the lower 48 States from an endangered to threatened status, 
demonstrate that there have been, and can continue to be, successes in 
endangered species recovery efforts. Several other species have 
improved in status to the point where they now near reclassification or 
delisting, such as the American peregrine falcon. The fiscal year 1998 
President's Budget requests $42.2 million for the recovery program, 
including an increase of $3.8 million. Part of this increase will be of 
critical importance to the delisting program.
    The budget justification states that no critical habitat 
designations will be made in fiscal year 1998 because this activity is 
a lower priority than responding to listing petitions.
    Question. Absent the designation of critical habitat, at what stage 
of the Endangered Species Act process are economic considerations 
formally taken into account?
    Answer. Species are listed under the ESA solely on the basis of the 
best scientific and commercial data available regarding the status of 
the species. However, economic effects can and should be taken into 
consideration in the planning and implementation of recovery 
activities. The current ESA provides flexibility with regard to 
recovery, and various policies recently implemented by the 
Administration, as well as increasing the role of stakeholders in 
recovery and focusing of Federal lands, will decrease the burden on 
private lands and work towards minimizing the economic effects of the 
ESA on private landowners.
    A new policy--part of the Administration's Ten Point Plan for ESA 
reform--significantly expanded recovery participation beginning in July 
1994. That policy directs that local jurisdictions, private 
organizations, and affected citizens be included in recovery plan 
development and implementation. Also, the public is invited to comment 
on draft recovery plans. These comments can supply important 
information about an affected community and can help to reduce or 
eliminate conflicts with listed species and their habitats. All 
comments are reviewed and addressed--if appropriate--in the final plan.
    The justification indicates FWS will ``significantly reduce its 
outstanding obligation'' under the settlement agreement in Fund For 
Animals v. Babbitt.
    Question. Given that FWS must cope with limited resources, does the 
Service feel its own listing petition management and priority system 
has been superseded or overwhelmed by lawsuits and settlement 
agreements such as the Fund For Animals? Does FWS manage its Listing 
workload according to national priorities that reflect threats to 
individual species, or is it forced to manage on the basis of the most 
recent court decision or lawsuit?
    Answer. Following the lifting of the listing moratorium and the 
restoration of listing funding in April 1996, significant program 
restart costs in terms of time and money were incurred by the FWS 
listing program. The FWS developed listing program restart guidelines 
to help expedite the resulting backlog of proposed rules through the 
listing process. The FWS was not able to finish the backlog during 
fiscal year 1996 using this triage approach and had at least twice the 
normal pending workload in the listing program in fiscal year 1997. To 
continue to address the backlog, FWS issued the Final Listing Priority 
Guidance for fiscal year 1997, published in the Federal Register on 
December 5, 1996. The Department is rigorously following this guidance 
to fairly and adequately address the backlog.
    Under the priority system, resources are apportioned among the 
following actions:
  --Emergency Listing Actions; and
  --Processing Final Decisions on Proposed Listings.
    Resolving the conservation status of candidate species and 
processing administrative findings to add species or reclassify 
threatened species to endangered
    Action on processing critical habitat determinations, is deferred 
because of the higher priority on resolving listing issues.
    The FWS fiscal year 1998 budget request proposes $78.8 million to 
support a workable Endangered Species program. This balanced request 
will address a variety of needs. The $4.9 million requested for the 
candidate conservation program will support 292 partnership efforts to 
keep species off the list. The listing program is funded at $5.2 
million to respond to petitions and answer legal challenges. To support 
full participation in Section 7 and Section 10 consultations, $26.5 
million is requested. This will provide for 900 formal consultations, 
1500 programmatic consultations, and 38,000 technical assistance 
consultations, as well as work on over 400 new and existing HCPs. With 
the $42.2 million request for the recovery program, FWS will be able to 
meet the growing workload demands and to help address the backlog of 
400 species without recovery plans. Delisting and reclassification 
actions previously funded in the listing activity would be funded at 
$500,000 within the recovery program.
    With the requested fiscal year 1998 listing program amount, the 
Department will continue to make progress in processing listings in 
accordance with the priority guidance. During fiscal year 1998, FWS 
anticipates that nearly 100 species will be proposed for listing and 
approximately 120 species will be added to the list. However, FWS does 
not anticipate designating critical habitat in fiscal year 1998, as 
this activity is a lower priority than responding to petitions and 
resolving the status of candidate species.
    The House Appropriations Committee has approved language to 
accompany the fiscal year 1998 appropriation for listing activities 
specifically restricting FWS from spending more than the allocated 
amount on the listing program. This language reads as follows: ``And of 
which not to exceed $5,190,000 shall be used for implementing 
subsections (a), (b), (c), and (e) of the Endangered Species Act of 
1973, as amended.''
    Together with the listing priority guidance, the appropriations 
language will put FWS in a better position to make listing decisions 
based on the best available scientific information, and not necessarily 
in response simply to litigation.
    Question. How much does FWS and the Department of Justice spend 
annually on ESA-related litigation?
    Answer. Our estimate reflects FWS and the Department of the 
Interior's Solicitor's Office costs only. The FWS costs are 
approximately $0.3 million and relate to document research and 
preparation, records assembly, and conferences with attorneys. The 
Solicitor's costs are approximately $0.9 million and assume a net of 12 
FTEs (at $75,000 each). Figures from the Department of Justice will be 
provided under separate cover.
    The budget justification indicates that FWS's Section 7 workload is 
steadily rising.
    Question. To what does FWS attribute this continued increase? At 
what point does FWS expect workload to level off? To what extent is 
increased use of programmatic consultations and Habitat Conservation 
Plans reducing funding requirements for the Consultation activity?
    Answer. The demand from Federal agencies for Section 7 
consultations, especially wide-ranging programmatic consultations, has 
greatly increased the FWS workload. As more species are listed, and as 
Federal agencies increasingly recognize their responsibilities in 
endangered species protection, the number and complexity of informal 
and formal consultations requested under Section 7 has increased 
significantly. This increase has been most dramatic in the southwest, 
southeast, and northwest regions of the United States. To support full 
participation in Section 7 and Section 10 consultations, $26.5 million 
is requested in the President's Budget which is critically important to 
ensure that FWS is able to issue accurate and timely biological 
opinions to other Federal agencies as required by Section 7, to 
maximize opportunities for the identification and informal resolution 
of potential conflicts in early project planning stages for both 
Federal (Section 7) and private (Section 10) actions, and to provide 
technical assistance to both Federal and non-Federal entities for the 
preparation of necessary compliance measures under both Sections 7 and 
10 as early in the planning process as possible.
    In addition, FWS is responsible for monitoring both the 
implementation and effectiveness of any measures required by 
consultations to minimize the take of listed species. As the number of 
formal consultations increase, the need to monitor compliance also 
increases. The increased popularity of HCPs, (Section 10(a)(1)(B) of 
the ESA) as a tool to resolve conservation and development conflicts on 
private lands has also resulted in an increased Section 7 workload 
because FWS must conduct an intra-FWS Section 7 consultation on the 
issuance of each Section 10 permit. As more species are listed, and as 
economic growth continues, the need for HCPs to address non-Federal 
actions on private lands will increase resulting in an increase in 
intra-FWS Section 7 consultations.
    The FWS expects the demand for consultations to continue to 
increase as Federal agencies continue to realize the need to consult, 
as the number of listed species continues to increase, and the 
continued increase in economic growth. However, FWS is taking every 
step to ensure that the consultation program is as effective and 
efficient as possible. To that end, FWS is finalizing a Section 7 
handbook that emphasizes efficiency in the implementation of the 
program. Additionally, we have developed streamlined consultation 
procedures for the implementation of the Pacific Northwest Forest Plan. 
These procedures serve as a model to develop and implement similar 
procedures in other parts of the country to further enhance our 
implementation efficiency.
    The FWS continues to be involved in many national, programmatic 
consultations on issues such as the EPA's registration of Department of 
Agriculture pesticides and pest control programs. The FWS anticipates 
that consultation on these and other national programs will continue in 
fiscal year 1998. Programmatic consultations tend to take longer to 
complete, but are often more effective and efficient in the long run 
because they allow FWS to address multiple actions affecting multiple 
species all at once, instead of several consultations on the same 
issue. The FWS believes that both Section 7 and Section 10 
consultations are equally important, and will need the increased 
funding requested in the President's Budget to address the workload 
associated with both types of consultations.
    A portion of the increase requested for Consultation is for Forest 
Plan activities.
    Question. How much Forest Plan funding is being allocated in fiscal 
year 1997 to Eastside ecosystem management? How much would be allocated 
for this purpose at the fiscal year 1998 request level? Why is this 
work included in the Forest Plan activity?
    Answer. The FWS has allocated $250,000 in fiscal year 1997 for 
participation in developing EISs to launch the Interior Columbia Basin 
Ecosystem Management Project (ICBEMP). The draft EISs were released for 
public comment in May 1997. The purpose of the ICBEMP is to restore and 
maintain long-term ecosystem health and integrity and to support the 
economic and social needs of communities by providing sustainable and 
predictable levels of products from Federal lands managed by the Forest 
Service and BLM. It is also the objective of the ICBEMP that no species 
would need to be listed under the ESA because of management actions of 
the Forest Service or BLM within the Columbia River Basin. Therefore, 
the participation of FWS along with the National Marine Fisheries 
Service was crucial in the development of the ICBEMP.
    Final EIS and Record of Decision (ROD) are planned for the third 
quarter of fiscal year 1998, with ICBEMP implementation to begin in the 
final quarter. The President's Budget requests an increase of $1.3 
million for Forest Plan consultations; approximately half of this 
funding increase would be allocated for the implementation of ICBEMP. 
Funding for the implementation of the Eastside EISs in the fiscal year 
1998 budget reflects the fact that the FWS expertise in these 
activities in the Pacific Region is in the Forest Plan program. 
Additional funding is critically needed for: 1) the FWS participation 
in the Ecosystem Analyses that are to be undertaken on Federal lands as 
a basis for future ICBEMP decision making; 2) the development of an 
HCP/Conservation Agreement capability to enable our non-Federal 
partners to pursue voluntary conservation agreements; and 3) required 
ESA Section 7 consultations on sharply increasing Forest Service and 
BLM activities associated with ICBEMP implementation. In the future as 
the ICBEMP program grows in importance, these funds will be displayed 
separately.
                         partners for wildlife
    The justification seems to indicate that proposed fiscal year 1998 
funding for the Partners for Wildlife program will continue the Klamath 
River Basin program, Nevada biodiversity research, and the Washington 
State Ecosystems Conservation project at the fiscal year 1997 level.
    Question. Is this accurate?
    Answer. Yes, the FWS fiscal year 1998 budget requests $1.7 million 
for the Klamath River Basin Restoration, $1.0 million for the Reno 
Biodiversity Initiative project in Nevada, and $1.5 million for the 
Washington State Ecosystem Conservation project, which is the same 
level as 1997.
    The justification indicates that the Nevada program will be 
completed in fiscal year 1998.
    Question. Are Partners for Wildlife funds for this program expected 
to be requested in fiscal year 1999? Will funding for follow-on 
activities be requested in other FWS activities?
    Answer. This initiative is an intergovernmental effort to assemble, 
analyze, and interpret data on the biological resources of Nevada. The 
University of Nevada at Reno, Stanford University, Nevada Division of 
Wildlife and the Nevada Natural Heritage Program work cooperatively 
with FWS, USGS Biological Resources Division, and the Forest Service to 
collect data and provide it in a usable format to agencies vested with 
the statutory responsibility to manage Nevada Public Lands. The 
initiative provides land management agencies with a planning tool, and 
a forum where they may discuss how they may coordinate their agendas in 
a way that best serves Nevada biodiversity. In addition, cooperators 
are developing a GIS system that would link University of Nevada, BLM, 
FWS, Forest Service, and Gap Analysis Systems, processing sensitive 
species occurrence data, and enhancing quality control procedures at 
the Nevada Natural Heritage Program. The FWS will consider the need for 
continued Federal assistance as it develops future budget priorities.
    The FWS is requesting an increase of $750,000 in Project Planning 
to accommodate work related to the relicensing of hydroelectric 
projects. The justification indicates that FWS will use the increase to 
``design, test, and prescribe technically sound fishways * * *.''
    Question. Does FWS currently have the type of resident expertise 
required to design and test fishways? Does FWS intend to establish or 
expand its resident design capabilities in this area? Wouldn't it be 
more cost-effective for FWS to focus on analysis and testing of fishway 
designs proposed by license applicants?
    Answer. When an applicant submits a fishway design, FWS must 
conduct a thorough biological, hydrological, and engineering analysis. 
It is imperative that the fishway fulfill the biological needs of fish, 
and function properly in a wide variety of river flow and environmental 
conditions when installed onsite. Often, trial field testing and 
modifications are in order to ensure fish will readily use and pass 
uninjured through the fishway.
    The FWS does not have facilities to test fishways, and does not 
propose to duplicate test facilities available with the USGS Biological 
Resources Division. The most cost-effective method is to focus our 
resources on analyzing the applicants' fishway designs. The $750,000 
requested in the President's Budget would help FWS modestly upgrade 
resident engineering and biological expertise needed to complete 
technical reviews of proposed fishway designs and participate more 
fully in trial testing with license applicants. With the requested 
funds, FWS can also improve customer FWS to Federal Energy Regulatory 
Commission license applicants by providing timely prescriptions for 
fish passage facilities that are biologically and technically sound, 
cost-effective, and reliable.
    Question. How much funding will be allocated to FERC-related work 
in fiscal year 1997?
    Answer. In fiscal year 1997, FWS estimates spending about $2.9 
million on all hydropower licensing activities, and will participate 
fully in the review of about one-third of the 231 projects currently 
pending relicensing, as well as all of the other actions above.
    During fiscal year 1998, FWS estimates that 100 additional license 
renewals will be initiated by applicants. To meet this increased 
workload, the fiscal year 1998 budget includes a request for an 
additional $0.75 million to allow FWS to develop non-regulatory 
partnership solutions by working upfront on 50 new FERC relicensing 
actions. Relicensing actions provide opportunities to mitigate for 
previous fish and wildlife impacts by improving instream flows, 
providing for fish passage, and creating or improving habitat.
    The FWS role in the hydropower licensing process is authorized by 
statute and the FERC regulations. The FWS participates by advising and 
assisting developers in preparation of study plans, developing terms 
and conditions, coordinating with other agencies, preparing mitigation 
plans, and participating in fishway, instream flow, and other studies. 
Relicensing activities are increasing nationwide as licenses for many 
hydropower projects expire. Since 1993, the licenses for over 260 dams 
across the country have expired. The licenses for over 550 more dams 
will expire in the next 15 years. Many of these dams were built without 
the benefit of fishways, instream flows, and other measures to conserve 
and protect fish and wildlife.
    Current workload is significant. During fiscal year 1998, FWS will 
work on almost 1,100 hydropower projects nationwide, including:

                                               HYDROPOWER PROJECTS                                              
----------------------------------------------------------------------------------------------------------------
                                                                                   Fiscal year--                
                                                                 -----------------------------------------------
                                                                       1996            1997            1998     
----------------------------------------------------------------------------------------------------------------
Prelicensing actions:                                                                                           
    Preliminary permits.........................................             150             140             130
    Original licenses...........................................             150             130             130
    Relicensing.................................................             160             200          \1\230
    Exemptions..................................................              30              40              40
Postlicensing actions:                                                                                          
    Licenses....................................................             350             450             500
    Exemptions..................................................              50              50              50
                                                                 -----------------------------------------------
      Totals....................................................             890           1,010           1,080
----------------------------------------------------------------------------------------------------------------
\1\ ``Rolling number'' includes 50 of the estimated new applications.                                           

                      national wetlands inventory
    The justification indicates that FWS is continuing to seek 
alternative data collection techniques that may lower the cost of data 
collection per unit.
    Question. What progress has been made in this regard in recent 
fiscal years? What prospects are there for further improvement? Has the 
level of cooperation from other agencies been satisfactory?
    Answer. The FWS has made considerable progress in recent years in 
working with its partners to determine alternative data collection 
techniques in order to lower costs in wetland mapping and collecting 
wetland status and trends data. These efforts are:
  --(1) Collaboration with EPA and the Natural Resources Conservation 
        Service on refining a cross-correlation technique. This 
        technique uses satellite imagery to monitor wetland changes in 
        the 30 percent of National Wetland Inventory maps that have 
        been digitized and are components of the wetlands layer of the 
        National Spatial Data Infrastructure.
  --(2) Work with the Central Intelligence Agency (CIA) and BLM on use 
        of recently declassified imagery to map wetlands and other 
        natural resources in remote regions of Alaska lacking existing 
        aerial photography.
  --(3) Refinement of the techniques involved with Analytical Stereo 
        Plotters and Global Positioning System satellites for 
        applications in mapping wetlands on military facilities and for 
        updating wetland status and trends plots.
    Improved efficiency and lowered costs are probable with all three 
methods. The only drawback is the scale limitation imposed by most 
conventional satellite imagery. However, the declassified CIA imagery 
may solve that problem. The level of cooperation among agencies 
continues to be congenial and productive.
                              maintenance
    The budget request includes a $9.75 million programmatic increase 
for Refuge Operations and Maintenance, which follows an $8 million 
increase in fiscal year 1997.
    Question. If funded at the request level, would the maintenance 
backlog in the refuge systems be reduced? If so, by how much? If not, 
why not?
    Answer. The budget includes a three-tiered effort to address the 
highest priority operational and maintenance needs of the Nation's 509 
National Wildlife Refuges. First, operational increases total $13.8 
million, or eight percent (including $4.1 million for pay and FERS 
retirement cost increases). Second, the budget continues the recreation 
fee demonstration program which will initially generate approximately 
$1.0 million for on-the-ground project work at the refuges which 
collect the user fees. Third, construction funding totaling $22.2 
million will be used for the highest priority infrastructure backlog 
needs including the rehabilitation of roads, dams and bridges; as well 
as $17.1 million in ongoing operations funding for routine maintenance. 
The $17.1 million plus the $22.2 million in the construction account 
will address the highest priority needs identified in the Maintenance 
Management System.
    The first increment of the operations increase is $9.8 million to 
protect wildlife, improve habitat, enhance recreation and education, 
and to accelerate comprehensive planning. The new Refuge Management 
Information System (RMIS) database was used to systematically rank 
priorities against nationwide goals to ensure project integrity and to 
compile a project list tied to the $9.8 million increase.
    The additional funding requested for habitat enhancement will be 
used to restore natural water flows and replant trees and prairie 
grasses. This funding will reverse the damaging effects of previous 
land uses which often include drainage, tree clearing, and elimination 
of native grasses. Restoring habitats now will ensure healthy and 
diverse ecosystems; ensure sustainable populations of fisheries and 
wildlife; and provide habitat for Threatened and Endangered (T&E) 
species. Implementation of wildlife dependent recreation and education 
projects will provide additional opportunities to the 29 million annual 
refuge visitors. Funding will also allow additional comprehensive 
management plans to be completed and guide future management of the 
refuge system.
    The second increment of the operations increase is $4.1 million to 
fully fund required pay and FERS retirement system costs for the 
approximately 2,800 employees of the refuge system.
                            law enforcement
    Question. The table on page 105 of the justification indicates that 
the number of shipments inspected in fiscal year 1996 fell dramatically 
from the number inspected in fiscal year 1995. Why?
    Answer. At the time the fiscal year 1998 budget was prepared, FWS 
had only preliminary information on shipments through July 24, 1996. 
The total shipments for fiscal year 1996 are 87,848. The shipments 
increased by 2,190 over the previous year.
                       migratory bird management
    A $1.5 million increase is requested for migratory bird management.
    Question. To what extent are activities that would be funded with 
this increase, particularly the increase for ``Species of Management 
Concern,'' activities that might otherwise be conducted with Endangered 
Species Candidate Conservation or Listing funds? How does FWS determine 
which accounts to draw upon for bird population monitoring activities? 
Are activities that will be conducted with funds identified for 
``Implement[ing] Conservation Actions'' similar to or the same as 
activities that will be funded with Candidate Conservation funds?
    Answer. Of the $1.5 million increase requested for migratory bird 
management, $600,000 is targeted for ``Species of Management Concern'' 
to implement those provisions of the Fish and Wildlife Conservation Act 
of 1980, as amended, that direct the FWS to ``identify species, 
subspecies, and populations of all migratory nongame birds that--are 
likely to become candidates for listing under the Endangered Species 
Act of 1973'' and to undertake appropriate conservation actions. We 
anticipate that fewer than one percent of the ``species of management 
concern'' will also be candidate species in fiscal year 1999.
    Migratory bird populations may also be monitored in conjunction 
with activities in the Candidate Conservation and Listing programs. 
These surveys are focused on specific threatened and endangered 
species, primarily to gather data needed for decisions on regulatory 
actions.
    The planned surveys on ``species of management concern'' 
concentrate on species that are not on the threatened and endangered 
species list. The monitoring information helps FWS and its partners to 
take actions to avoid future imperilment and listing of species of 
concern.
    No increase is requested for the North American Waterfowl 
Management Plan (NAWMP).
    Question. How many wetlands joint ventures currently exist? At what 
level are each of these joint ventures funded in fiscal year 1997? In 
the fiscal year 1998 request? How much of an increase would be required 
to provide currently unfunded joint ventures with a level of support 
comparable to funded joint ventures? Would such an increase enable 
currently unfunded joint ventures to coordinate a significant amount of 
additional wetlands restoration projects?
    Answer. Currently, 10 wetlands habitat joint ventures exist in the 
U.S. as part of the North American Waterfowl Management Plan. Of these, 
the six original joint ventures are funded through the FWS Regions. The 
table below presents the fiscal year 1997 allocation to each FWS Region 
in support of coordination activities for the original joint ventures 
(Atlantic Coast, Central Valley Habitat, Gulf Coast, Lower Mississippi 
Valley, Playa Lakes, and Prairie Pothole Joint Ventures). The table 
identifies funded and unfunded joint ventures in each Region and 
indicates the Region with lead coordination responsibility for each 
joint venture.

 FISCAL YEAR 1997 REGIONAL ALLOCATION TO SUPPORT ORIGINAL NAWMP HABITAT 
                             JOINT VENTURES                             
                        [In thousands of dollars]                       
------------------------------------------------------------------------
                          Joint ventures--                              
  FWS  ----------------------------------------------------- Allocations
region            Funded                   Unfunded                     
------------------------------------------------------------------------
     1Central Valley habitat     Pacific Coast \1\,               275   
       \1\                        Intermountain West.                   
     2Gulf Coast \1\, Playa      Intermountain West......         314   
       Lakes \1\, Lower                                                 
       Mississippi Valley                                               
     3Prairie Pothole, Lower     Upper Mississippi River/         357   
       Mississippi Valley         Great Lakes Region \1\.               
     4Lower Mississippi Valley   ........................         366   
       \1\, Atlantic Coast,                                             
       Gulf Coast                                                       
     5Atlantic Coast \1\         ........................         266   
     6Prairie Pothole \1\,       Rainwater Basin \1\,             713   
       Playa Lakes                Intermountain West \1\.               
------------------------------------------------------------------------
      \1\ Joint ventures indicate regional lead coordination            
        responsibility.                                                 

    The fiscal year 1998 President's Budget does not include an 
increase in funding for the North American Waterfowl Management Plan. 
Allocations to the Regions to support coordination of the six original 
joint ventures would remain essentially the same under the fiscal year 
1998 budget request. If appropriated, an additional $800,000 would fund 
the remaining joint ventures with a level of support comparable to that 
provided to the original six joint ventures in fiscal year 1997.
                  hatchery operations and maintenance
    In the fiscal year 1996 budget request, the Administration proposed 
to close or transfer to States 11 fish hatcheries.
    Question. To date, how many of these hatcheries have been 
transferred to States? What is the status of the remaining hatcheries, 
both with regard to fish production and any continuing discussions 
regarding transfer to the host States?
    Answer. Five hatcheries have been transferred to the States: three 
in fiscal year 1996 (Walhalla NFH, SC, to SC; Carbon Hill NFH, AL, to 
AL.; and Bo Ginn NFH, GA, to GA) and two in fiscal year 1997 (McKinney 
Lake NFH, NC, to NC; and Meridian NFH, MS, to MS). Transfer talks have 
been completed with the State of West Virginia for the transfer of 
Bowden NFH, WV, under a MOA that will take effect on July 1, 1997.
    Production at three of the hatcheries not transferred to the States 
(Chattahoochee Forest NFH, GA; Wolf Creek NFH, KY; Inks Dam, NFH, TX) 
will be redirected into high priority Federal Fisheries activities 
(i.e., providing fish to mitigate for the adverse effects of Federal 
water development projects, restoration of imperiled 
interjurisdictional fisheries, and recovery of T&E species). Because 
Mescalero NFH, NM, meets the needs of the Native American Pueblos in 
New Mexico, consistent with the FWS tribal trust responsibility, 
production at the hatchery will not be redirected.
    Valley City NFH, ND was originally proposed for transfer/closure in 
the President's fiscal year 1996 Budget. However, after a subsequent 
review of the hatchery's role, the hatchery was withdrawn and is no 
longer considered for transfer/closure.
    The FWS will continue to pursue State initiated transfer requests 
for Chattahoochee Forest, Wolf Creek, or Inks Dam, and offer the three 
year transition opportunity, through fiscal year 1997.
    Question. What savings from hatchery transfers, production cuts or 
closures will be realized in fiscal year 1997 for use in other 
fisheries programs? In fiscal year 1998?
    Answer. The total base funding of the 10 hatcheries of concern was 
approximately $2.37 million annually. As hatchery transfers proceed 
over the three year period that began in fiscal year 1996, an 
increasing portion of this base funding has been freed-up and 
redirected to meet high priority Federal fishery responsibilities. This 
freed-up funding is $655,000 for fiscal year 1996, $1.2 million for 
fiscal year 1997, and $1.5 million in fiscal year 1998.
    The savings from hatchery transfers have been reinvested into the 
fisheries program in an effort to restore the FWS ability to meet high 
priority Federal responsibilities. Had FWS not done this, the Fisheries 
program would have continued to fall substantially short of fulfilling 
its core responsibilities. The $1.46 million in savings is being 
redirected into: mitigation ($232,000), restoration efforts ($899,000), 
and threatened and endangered species recovery ($44,000). Transfer/
administrative costs ($282,000) will also be covered out of realized 
savings.
    Page 131 of the justification indicates that Hatchery O&M funds 
will be used to replace inadequate backup water supply systems at 
Dexter National Fish Hatchery.
    Question. How old are the systems that are being replaced? Why were 
these systems inadequate?
    Answer. The current backup systems are over 20 years old and rely 
on water from distant wells being redirected to rearing units where the 
water supply has failed. Because of the need to manually switch valves, 
water to some fish tanks has been disrupted for an hour before backup 
water arrives. This has led to the loss of endangered fish, most 
recently the loss of razorback suckers involved in a broodstock 
development program. A new backup system would provide an immediate 
water reserve through a 50,000 gallon water tower, with water supply 
redirection accomplished using automatic controls. The threatened and 
endangered fish species maintained at Dexter NFH and Tech Center are 
too valuable to be exposed to the risk of the current backup system.
    Over the past several years, the Pacific Northwest has been 
grappling with the issue of salmon recovery. The FWS hatchery system 
plays an important role in this process.
    Question. How have operations at salmon and steelhead hatcheries in 
the Pacific Northwest changed in response to ongoing salmon recovery 
efforts? Have funding requirements for individual hatcheries changed 
significantly? Have funding requirements for the FWS Northwest hatchery 
system changed significantly?
    Answer. In recent years, conservation needs for hatchery and wild 
salmon and steelhead stocks in the Pacific Northwest have become 
increasingly acute. Marine and freshwater conditions have been 
extremely poor in most areas. Habitat, hydropower, harvest, and 
hatchery issues also have received considerable attention. Resource 
managers have responded in a number of ways to ensure that healthy 
productive hatchery and wild salmonoid populations can be recovered, 
restored, and maintained to support sustainable fisheries and other 
important ecological and social values for future generations. The FWS, 
along with its other partners, are committed to a comprehensive 
conservation strategy for salmon and steelhead that has many 
complementary components (supplementation, mass marking, improved 
genetics, improved fish health, captive broodstock, comprehensive 
evaluation, etc.).
    The primary responsibility of FWS hatcheries is to meet the 
restoration/mitigation production and trust resources goals for which 
they were established. Production from these facilities directly 
supports recovery plans/objectives, legislative and judicial mandates, 
and Executive Orders. In order to meet these responsibilities, 
mandates, and goals, FWS must continue to meet hatchery production 
requirements with quality fish in an environmentally sound manner. In 
addition, the FWS hatcheries, fish health centers, and fish and 
wildlife offices must continue to expand their evaluation and 
monitoring programs to maintain production efficiency and assure that 
the genetic integrity, diversity, and fitness of hatchery stocks are 
sustained.
    In response to ongoing recovery efforts, and activities designed to 
preclude species listing, FWS hatcheries and supporting offices have 
initiated many of the following actions:
    1. Develop captive broodstock (maximize effective population size 
and genotypes).
    2. Initiate new broodstock development techniques (improve mating 
protocol, reduce effects of inbreeding, maximize biodiversity, increase 
effective population size, incorporate wild stocks, etc.).
    3. Increase hatchery evaluation and assessment.
    4. Mark additional hatchery fish to assess impacts between hatchery 
and wild populations.
    5. Utilize hatchery stocks for supplementation activities where 
wild stocks have been extirpated.
    6. Restrict locations of hatchery fish releases to reduce impacts 
on wild stock (do not release on top of emerging native fry).
    7. Adjust operational practices to produce hatchery fish which are 
released at the size and time that reduces impacts to wild stocks and 
eliminates competition and displacement of wild populations.
    8. Produce salmon and steelhead smolts that are ready to migrate 
immediately upon release.
    9. Improve fish health and increase disease diagnosis and 
monitoring of hatchery populations (reduce disease impacts of hatchery 
outplants).
    10. Increase fish health monitoring of wild stocks. 11. Mark 
additional hatchery stocks to address harvest management concerns.
    The FWS National Fish Hatcheries and supporting Fish Health 
Centers, Fish and Wildlife Offices, and Fish Technology Center have to 
establish annual funding priorities to meet the growing demands for 
evaluation and monitoring programs that maintain production efficiency 
and assure that the health, genetic integrity, diversity, and fitness 
of hatchery stocks are sustained. Mass marking of hatchery releases is 
also becoming increasingly important.
                     cooperative endangered species
    In fiscal year 1997, the Department for the first time received 
funds for a land acquisition grants to States program.
    Question. How are funds allocated under this program? Has the 
Department established grant criteria for this program? Have such 
criteria been published?
    Answer. The HCP Land Acquisition Grants to States program provides 
grants for land acquisition at the local level for approved HCPs. The 
Department considers the States' use of Federal acquisition dollars for 
habitat protection within, and adjacent to, HCP areas to be an 
important and effective mechanism to promote the recovery of threatened 
and endangered species. These acquisition and land exchanges 
complement, not supplant, private and/or local government 
responsibilities required for mitigation related to implementing HCPs. 
Of the $6.0 million available for the program for fiscal year 1997, 
$2.75 million has been allocated as follows:
  --Balcones Canyonlands HCP, Texas ($1.0 million): The BCCP is a 
        regional HCP that protects 35 listed and candidate species, 
        including the golden-cheeked warbler, black-capped vireo, and 
        six invertebrates, among others.
  --Orange County Coastal Central HCP, California ($0.5 million): This 
        HCP covers the California gnatcatcher, peregrine falcon, 
        southwestern willow flycatcher, and 34 other rare species.
  --Volusia County HCP, Florida ($0.5 million): This plan protects 
        three species of nesting sea turtles as well as piping plovers.
  --Washington County HCP, Utah ($0.75 million): This HCP covers 34 
        listed and candidate species, including the desert tortoise, 
        peregrine falcon, and bald eagle.
    The remainder of the funds will be allocated later this year as FWS 
continues to evaluate project proposals. The fiscal year 1998 
President's Budget continues this program at the $6.0 million level.
                         National Park Service
                            special use fees
    In a 1995 audit report, the OIG concluded that the National Park 
Service ``did not implement its authority to collect and retain fees 
for special park uses in a consistent manner. This occurred because the 
Park Service has not completed its efforts to revise the existing 
guidance (NPS-53, ``Special Park Uses'') to address the changes created 
by the Appropriations Acts of 1991, 1992, 1993, and 1994 * * *.''
    Question. Has NPS revised its guidelines for collection of special 
use fees subsequent to the OIG's report? If not, why not?
    Answer. The NPS has a draft revision that is out for review.
    Question. Does NPS intend to make such revisions? When, and through 
what process?
    Answer. Yes, after the review is completed, the guidelines will be 
finalized and sent to the field. The NPS expects to complete this by 
late fall or early winter of 1997.
                              grand canyon
    Non-commercial boaters have expressed concern about the level of 
fees that have been levied on their activities in Grand Canyon National 
Park.
    Question. What fees are currently charged for these activities?
    Answer. Individuals participating in noncommercial river use within 
Grand Canyon National Park currently pay a $100 Permit Application Fee, 
a $25 Annual Renewal Fee (to maintain their position on the Permit 
Waiting List), a $200 Launch Fee, and a $4 per night/per person 
Backcountry Impact Fee. These fees are in addition to the $10 per 
person Park Entrance Fee. This fee program has been specifically 
designed to spread the costs to the users over the life of the 
relationship between the permittee and NPS, which averages nine years. 
Payment is made as services are rendered. Taking all of these fees 
together, split among the average number of participants in a 
noncommercial Grand Canyon river trip, the average cost is $100 per 
person for all services rendered, preservation of the resource, and the 
opportunity to participate in this world class river experience.
    Question. How do the fees compare to the estimated cost to the Park 
Service of managing such activities?
    Answer. The cost recovery component of this fee program is designed 
to achieve 95 percent recovery of direct NPS costs associated with 
managing noncommercial river use in the park, in compliance with the 
law and OMB Circular A-25.
    Question. If the fees are in excess of the costs of managing the 
activity, why?
    Answer. The $4 per night/per person Backcountry Impact Fee is being 
collected as part of the new Recreation Fee Demonstration Program. As 
such, this new fee does generate revenue above and beyond the amount 
necessary to cover current operational costs. In compliance with the 
legislation authorizing the Recreation Fee Demonstration Program, this 
revenue will be used to address a large backlog of resource related 
projects in the backcountry and the river corridor. These funds will 
only be used for projects directed at the prevention, monitoring, and 
rehabilitation of impacts caused by backcountry and river use.
    Question. Are any of the fees assessed on this activity part of the 
recreation fee demonstration program?
    Answer. As described above, the $4 per night/per person Backcountry 
Impact Fee is being collected as part of the new Recreation Fee 
Demonstration program.
                      presidio and presidio trust
    I recently had the opportunity to visit the Presidio in San 
Francisco. While impressed by the beauty of the property, I am perhaps 
more convinced than ever that the Presidio would more appropriately be 
managed as a city or local park. Nevertheless, we have passed 
legislation establishing the Presidio as a national park to be managed 
by the Presidio Trust. My principal concern is now how to pay for the 
operation of this very expensive park.
    The fiscal year 1998 budget request for the Presidio is $24.6 
million dollars. This same amount was approved for fiscal year 1997. On 
April 18, 1997, the Secretary announced selections for the Board of 
Directors of the Presidio Trust.
    Question. What activities will occur during fiscal year 1997 by the 
Board of Directors to move forward with plans to designate sites within 
the Presidio which will be managed by the Board?
    Answer. The NPS expects that through the summer and fall of 1997, 
NPS and the Presidio Trust's Board of Directors will organize the 
transition of responsibilities between NPS and the Trust. Orientation 
provided by NPS will help familiarize Board members with the Presidio, 
their responsibilities as Board members, and the first year's 
requirements as outlined in P. L. 104-333. Once this is accomplished 
the Board can then move forward in designating sites within the 
Presidio they will manage and develop the appropriate plans to guide 
future management decisions.
    Question. Has the agency developed plans and alternatives for 
consideration by the Board?
    Answer. The NPS is developing plans and alternatives to transition 
responsibilities from NPS to the Trust. However, actual decisions 
regarding administration of the Presidio areas managed by the Trust 
rest with the Board.
    Question. Does the agency have estimates of what the long-term 
operations costs will be for those sites not selected by the Board to 
be operated by the Trust?
    Answer. The NPS has not developed long-term operational costs for 
non-selected sites.
    Question. Does the agency have estimates for the potential ``seed'' 
money necessary to restore specific sites which may be designated by 
the Board?
    Answer. The Presidio Trust plans to hold its first meeting in early 
July, 1997. As part of the planning process, it is expected that the 
Trust will develop estimates of funds needed to redevelop the Presidio.
    Question. In your mind, how long should it take for the Presidio to 
generate sufficient revenues to finance its own operation?
    Answer. The authorizing legislation requires the Board to present a 
financial plan within a year of the their first meeting, which is 
expected to occur in July, 1997. The financial plan will review 
Presidio leasable space, current market conditions, trust financing 
authorities, and related factors. That plan will also provide a 
timetable by which the lease revenues will finance the operation of the 
areas managed by the Trust.
    Question. How many years do you envision Federal support for 
Presidio operations remaining at the level requested in the fiscal year 
1998 budget?
    Answer. The Department lacks the appropriate information to 
determine the exact time when Federal appropriations will diminish. 
However, the Department notes that significant work must occur before 
the buildings can be leased. To achieve this result, the Trust has 
several financial tools by which it can guarantee loans, provide direct 
loans, or issue Treasury obligations. All of these financial 
authorities are subject to Federal appropriations and the use of these 
tools will require the appropriation of funds in excess of the amounts 
requested in the fiscal year 1998 budget.
    Question. How long before we reduce that amount by half?
    Answer. As stated previously, the Department lacks sufficient 
information to determine when Federal appropriations will be reduced 
for the Presidio. The financial plan that the Trust is required to 
prepare should provide an indication of the timeframe.
             government performance and results act (gpra)
    The agency budget justification states that by Spring 1997, a 
revised strategic plan will be produced.
    Question. What is the status of the strategic plan development?
    Answer. The strategic plan should be published in the late summer 
of 1997.
    Question. Are copies available? If not, when will they be 
available?
    Answer. Copies of the final draft strategic plan (published October 
1996) are now available, as are the revised interim goals. The final 
strategic plan is expected to be available late this summer.
    Implementation of GPRA requires the establishment of national 
accomplishment and accountability standards.
    Question. How will such uniform standards be established for the 
agency which is highly decentralized, and in which decision making 
authority is delegated to individual park managers?
    Answer. The GPRA requires common outcomes rather than uniform 
standards throughout the agency. Development of an Eight-Step process 
of GPRA implementation--which goes from the mission of NPS to daily 
activities to reporting on annual accomplishments, and by setting 
Servicewide outcome goals--will enable individual parks to use the 
Servicewide goals (which will be aggregated) as well as develop park-
specific goals. The entire NPS GPRA implementation system is designed 
to work at both the national (Servicewide) and park-specific levels.
    Question. Will GPRA reduce costs for the agency?
    Answer. Once GPRA is fully implemented, NPS expects this will make 
the agency more efficient.
    Question. Does the agency intend to discontinue the use of any 
other planning processes upon implementation of GPRA?
    Answer. The NPS is considering eliminating the Statement for 
Management as redundant to the annual performance plan. The agency is 
also working to integrate GPRA with current NPS planning and management 
reporting processes.
    Question. Does the agency intend to continue its consultation 
process with Congress?
    Answer. The NPS has consulted with Congressional offices since 
August 1995, on GPRA and its implementation. Because GPRA 
implementation is an ongoing process, the NPS intends to continue 
consulting with Congress in the future.
                            park operations
    A $65.7 million increase is planned for park operations. The agency 
budget justification states that parks will receive a one percent 
across-the-board increase. In addition to the one percent across-the-
board increase, the agency proposes to increase operations at various 
park sites by $16.3 million.
    Question. How are operating costs and efficiencies assessed 
annually to determine if some parks need more or less in funding?
    Answer. The NPS maintains a data base which identifies all unfunded 
park operating requirements. This data base is generally updated twice 
a year: 1) in the spring prior to the beginning of the budget 
formulation process; and 2) in the fall, after enactment of the current 
year budget request. The increases identified in the data base undergo 
review at all levels of the organization, beginning with the park and 
park cluster management, and continuing with the Regional and 
Headquarters Offices. After review, the requests are prioritized within 
the amount of funding allowance provided at each stage of the budget 
process.
    The agency budget request states that 63 units will receive an 
increase of 214 FTEs and $16.3 million.
    Question. How will these FTEs be allocated among each of the units?
    Answer. If the entire $16.3 million is enacted as proposed, the 
FTEs associated with each request and identified by the requesting 
office, would be allocated as described in the NPS fiscal year 1998 
Budget Justifications. Should the requested dollars not be provided, 
NPS would reexamine staffing requirements prior to any allocation so as 
to fit the needed FTE within available targets.
    A $7.1 million increase is requested to improve capabilities within 
the natural resources management program. Included in this amount is 
funding for establishment of Cooperative Ecosystem Studies Units to 
focus on science needs of NPS.
    Question. What portion of the total scientific program will be 
funded from this effort?
    Answer. The NPS defines its ``scientific program'' as inclusive of 
both its research and resource management activities. Natural resource 
management applies the scientific findings of inventory, monitoring, 
and research to the management of park natural resources. The NPS 
technical specialists in natural resource management generally are 
trained in one of the natural or social sciences and use their training 
as scientists to guide their application of scientific information in 
their routine work. The Service's natural resource budget request in 
fiscal year 1998 (Natural Resources Applied Research, Natural Resources 
Management, Everglades Restoration and Research) totals $93.2 million. 
The requested increase of $7.1 million represents 7.6 percent of this 
total request. The Cooperative Ecosystem Study Unit (CESU) portion of 
the increase represents 2.5 percent of the total natural resources 
request.
    Question. What portion of total science needs are handled ``in 
house?''
    Answer. Very little research is conducted in-house. The NPS does 
have structured air-quality and social science research programs. 
However, NPS obtains most of its needed scientific research from its 
partners in the USGS Biological Resources Division (BRD), other 
governmental research organizations, the academic community, and other 
science partners. The Park Service relies on BRD to fund and conduct 
much of the biological research NPS needs, but in some cases also 
directly funds the applied, site-specific biological research that BRD 
either is unable, or does not want, to fund. The NPS receives research 
support from other divisions of the USGS and also directly funds some 
of its water and geology research needs.
    The NPS usually defines ``science needs'' to include its resource 
management activities--that is, the application of science to 
management of resources. The Park Service handles inhouse almost all of 
its resource management science application needs within its resource 
inventory, monitoring, and management activities. The NPS seeks 
technical assistance to support this inhouse application from BRD and 
other government researchers and science-educated professionals, from 
university scientists, and from scientists in other partner 
organizations.
    Question. How does work to be performed by these units differ from 
work performed by the Biological Research Division of the U.S. 
Geological Survey?
    Answer. The BRD conducts biological research, but not research in 
other disciplines and not routine, management-oriented inventories, 
monitoring, and operational management activities that apply science. 
The NPS science-educated resource management professionals analyze and 
apply scientific information from a wide range of physical, biological, 
social, and cultural sciences in conducting their inventory, 
monitoring, and resource management responsibilities. The CESUs will 
provide technical assistance to NPS and other land managers in these 
activities, as well as in a wide range of research disciplines.
    The CESU partnership is designed to provide NPS professionals daily 
consultation with BRD research biologists, as well as with university 
and other Federal researchers in non-biological disciplines. The work 
performed at these units will be directed and overseen by a CESU 
managers committee (from land management and other agencies).
    A $6.5 million increase is planned for cultural resource management 
program needs. Of this amount $3.5 million is planned for the Vanishing 
Treasures program.
    Question. How much of this program involves cooperative 
arrangements with other government or private interests?
    Answer. To date, there are no cooperative agreements with other 
government or private interests in the Vanishing Treasures program. It 
is likely, however, that some parts of the program, for example the 
training, will involve cooperative agreements with educational 
institutions that possess demonstrated expertise in ruins preservation 
in arid lands. There could be room for other agreements as well.
    Question. Is any funding for this effort received through 
leveraging?
    Answer. The vast majority of the need for the Vanishing Treasures 
initiative involves straightforward operational activities of the 
National Park System, in which opportunity for leveraging is limited. 
It is anticipated that private philanthropists will want to 
participate--probably in some area of work that would not normally be 
done with appropriated dollars. The Vanishing Treasures Working Group 
would endeavor to use both appropriated and donated funds in a manner 
that maximize the benefit to the resources and the taxpayers, and that 
might be described as leveraging. We also believe that, should the 
Congress fund the program, the private sector will be more likely to 
support the program, thus allowing appropriated funds to leverage 
donated funds.
    Question. Are Native American Tribes active partners in this 
program?
    Answer. The Vanishing Treasures Working Group has not yet enlisted 
Tribes as active partners, however several Tribes are aware of the 
initiative and could be involved if the program is fully funded. In 
addition, a plan has been developed for consultation with Tribes known 
to have affiliation with the places to be preserved, and preliminary 
consultations will begin within the next several weeks.
    A report by the General Accounting Office, dated April 1997, states 
that ``decisions about spending and operating priorities associated 
with park operating funds are delegated to individual park managers.'' 
The report also states: ``According to park managers we (GAO) spoke 
with, regional or headquarters staff rarely, if ever, discussed with 
them operation priorities or results accomplished * * *. No 
expectations have been established for the goals that are to be 
achieved in the parks, and there is no process for measuring progress 
toward these goals.'' The GAO's conclusions are that national priority 
setting and accountability is lacking regarding expenditures and 
accomplishments at the parks.
    Question. What action is the agency taking to address the issues 
identified in this GAO report?
    Answer. The NPS acknowledges that most of the day-to-day operating 
and spending decisions at parks have been delegated to the park 
managers. The need to balance competing priorities as ever-changing 
circumstances warrant is best left to managers on the scene. The NPS 
disagrees with the report's conclusion that operational priorities are 
``rarely, if ever, discussed'' with park managers by regional and 
headquarters management. Overall NPS operational policies and 
priorities are communicated to park managers in many forms, ranging 
from official memorandum, electronic mail, and formal meetings. For 
example, in fiscal year 1997, the Acting Deputy Director of NPS 
communicated to the field the expectation that the fiscal year 1997 
enacted appropriations should prove sufficient to preclude significant 
closures as was the case in fiscal year 1996. Special emphasis program 
thrusts, such as messages on employee safety and enhanced fee 
collection, are frequently highlighted by central office personnel in 
various communications. In addition, park managers are evaluated by 
regional directors based upon performance in park operations, and 
specific priorities are frequently highlighted in these evaluations to 
stress the importance placed upon them. These practices will continue 
and further emphasis will be placed on effective communication of NPS 
priorities to the field.
    Question. How will these findings be addressed in the development 
of GPRA goals for fiscal year 1998?
    Answer. The NPS is implementing GPRA by requiring the development 
of goals and annual performance plans at the park level. These plans 
will be in conformance with the NPS Strategic Plan and will be approved 
by Regional Directors. This GPRA implementation plan, to begin for 
fiscal year 1998, will ensure that further emphasis is placed on what 
results are anticipated from a park manager's efforts.
    The process of developing appropriate and meaningful goals is 
dynamic. When developed and stabilized, they should provide a linkage 
of budget resources to results achieved. This process may take several 
years, but should lead to performance measurement in a more systematic 
manner than at present.
    A General Accounting Office report dated April 1997 states that the 
agency's flexibility is greatly diminished due to the large proportion 
of permanent employees. The GAO states that 93 percent of the Park 
Service staff is permanent which contradicts with the highly seasonal 
use of the parks.
    Question. Why is the amount of permanent staffing at this 
percentage level?
    Answer. The percentages cited are incorrect. The percentage of 
permanent employees in NPS ranges from 60 to 75 percent of the total 
work force, depending on the time of the year. The number of seasonal 
employees peaks during the summer season. For example, at the beginning 
of the summer season, only approximately 60 percent of NPS employees 
on-board would be classified as ``permanent.'' This number grows as 
seasonals go off the payrolls throughout the summer and into the fall.
    While the number of permanent employees is currently higher than it 
has been in the past, there are several reasons for this trend. So as 
to ensure that health and life insurance benefits are provided to 
eligible employees, NPS has taken steps to more appropriately classify 
long-term temporary employees who work longer than six months of the 
year and are employed without separation for a series of years. This 
has resulted in a reduction of ``temporary'' employees in NPS. Another 
factor which has lessened the number of ``seasonal'' employees is a 
change in the pattern of park use by visitors. It is increasingly 
common to see rising visitation at parks in the ``off-peak, shoulder 
seasons'' of the fall and spring. This practice has resulted in 
seasonals being required for longer than a six-month period, and a 
reclassification of these employees to permanent.
    Most importantly, at many parks, limited funding has decreased the 
number of seasonals able to be hired. The reduction in the seasonal 
program is a common management action taken to offset mandated cost 
absorptions in recent years, particularly the absorption of pay raises 
costs not provided. These actions have reduced the percentage of 
``seasonals'' in the NPS work force.
    Question. Does the agency foresee an increase in the percentage of 
the workforce comprised of temporary employees?
    Answer. The NPS management has made it clear to park and regional 
managers that the growing percentage of permanent employees is a 
practice that is not generally conducive to good management. 
Accordingly, should the budget of NPS at parks continue to grow 
steadily as in fiscal year 1997, and as requested for fiscal year 1998, 
the percentage and number of temporary employees is likely to 
stabilize, at the least, and should potentially grow.
                          resource stewardship
    During the State of the Union message the President announced the 
establishment of 14 National Heritage Rivers.
    Question. How will NPS be impacted by the establishment of these 
rivers?
    Answer. Communities will submit nominations to designate rivers, 
and some that are identified that may include reaches that run through, 
or near, parks. In the event that one of these rivers gets designated, 
it is likely that park staff will be invited to participate in the 
partnership that is established to work on the community's plans.
    In addition, several technical assistance and grants programs in 
NPS have been identified as useful components of the Federal 
``toolbox'' that is available to assist communities with river 
conservation and historic and cultural resource preservation. These 
programs include Rivers, Trails, and Conservation Assistance, Historic 
Preservation Tax Incentives program, Comprehensive Historic 
Preservation Planning, the Historic Preservation Fund, and others. It 
is anticipated that NPS, operating these programs according to their 
customary criteria, may be able to assist some American Heritage River 
communities.
    Question. What criteria will be used for designating a National 
Heritage River?
    Answer. The American Heritage Rivers initiative was outlined in a 
Federal Register notice (published May 19, 1997) that invited public 
comment. The criteria listed in the Federal Register notice (which are 
still subject to change) are:
                          qualifying criteria
    The qualifying criteria are intended to be broad, flexible, and 
credible. Designation is available both to community-led efforts that 
are well underway and to communities just beginning. In making a 
nomination, sponsoring communities or organizations must demonstrate 
broad community support; notable resource qualities; local and regional 
partnership agreements; strategies that lead to action; and an ability 
to achieve measurable results.
  --(1) Broad Community Support.--A broad spectrum of private citizens, 
        such as landowners, businesses, educational and arts 
        organizations, community leaders, economic developers, 
        nonprofit organizations, public and private institutions, local 
        and State government agencies, Indian Tribes, elected 
        officials, and/or other parties within and adjacent to the 
        proposed area or areas support the designation and the goals of 
        American Heritage Rivers.
  --(2) Notable Resource Qualities.--There are within the proposed 
        river area (as defined by the community or organization) a 
        range of natural, economic, scenic, historic, cultural, and/or 
        recreational features that demonstrate distinctive qualities of 
        America's river heritage.
  --(3) Local and Regional Partnership Agreements.--The principal party 
        or parties nominating the river and local or regional 
        governmental entities show their willingness and capability to 
        enter into new, or to continue and expand existing, partnership 
        agreements with each other as well as with Federal and State 
        agencies, Indian Tribes, and/or other parties to implement a 
        plan for the river area.
  --(4) Strategies That Lead to Actions.--The principal local 
        sponsoring party or parties has in hand, or is developing, a 
        broad plan of action for the river area. Any actions planned on 
        the designated area should not impact downstream communities.
      At a minimum, the strategy includes the following components: 
        community vision; operating procedures and policies; 
        description of how the proposal takes into account existing 
        plans for the area; public participation and public education; 
        projects and products (including any anticipated impacts beyond 
        the designated river area); resources committed and anticipated 
        (including means for generating additional and matching support 
        from both public and private sources; schedule of actions; what 
        the community expects the Federal role to be; obstacles to 
        community action, including those the community believes can be 
        resolved by joint Federal, State, and local support; and 
        Measures of success.
  --(5) Measurable Results.--Implementation of the community's vision 
        must result in measurable benefits to the river community 
        reflecting the community's goals, including, but not limited 
        to, protection of water resources and/or public health, 
        restoration of rivers, protection and highlighting historic and 
        cultural resources, revitalization of local and regional 
        economies, and/or implementing sustainable development within 
        the river area.
                           selection criteria
    A selection council, convened by the President and discussed below, 
will, for those nominations meeting the qualifying criteria, also seek 
to ensure that, individually or as a group, American Heritage Rivers 
will exemplify America's river heritage at its best, in all its 
natural, historic, cultural, social, economic, and ecological 
diversity. The selection council will judge whether the designated 
rivers will showcase a variety of stream sizes and situations, in 
urban, rural, and mixed contexts. They will also assess the potential 
for an American Heritage River to showcase one or more innovative 
programs in such areas as watershed planning, historic preservation, 
wildlife management, fisheries restoration, community revitalization, 
floodplain management, and recreation. Applicants should keep in mind 
the selection criteria in their responses to the qualifying criteria.
    In addition, designated rivers will be able to benefit 
significantly from a broad range of refocused or retargeted Federal 
programs or other assistance and help generate broader public support 
for the goals and guiding principles of American Heritage Rivers as 
excellent examples and models for emulation throughout the Nation.
    Question. How much will the President's initiative cost the Park 
Service?
    Answer. Because the work done for this initiative falls entirely 
within the scope of existing programs (and their mandates and 
criteria), it is anticipated that the only cost to NPS for support of 
the American Heritage Rivers initiative will be the time associated 
with FTE dedicated to American Heritage Rivers.
    A $2.5 million increase is planned in the Applied Research program. 
Three projects are scheduled for completion in fiscal year 1997 which 
relate to air quality monitoring.
    Question. Based on findings from these studies, how will 
alternatives be developed to determine the Administration's approach to 
air quality management around these three study areas?
    Answer. The $2.5 million increase for the Natural Resources Applied 
Research Program is primarily for establishing Cooperative Ecosystem 
Studies Units at universities; none of this increase will fund 
additional air quality monitoring and research activities. 
Coincidentally, $2.5 million of the $8.3 million fiscal year 1998 
budget request for applied research is earmarked mostly to support all 
of the ongoing long-term visibility monitoring and research performed 
in national parks--especially those designated as ``Class I'' under the 
Clean Air Act.
    However, a $1.0 million increase is being requested within the 
Natural Resource Management portion of the fiscal year 1998 budget 
primarily for the much needed modernization of the NPS air quality 
monitoring network.
    With respect to the three projects slated for completion in fiscal 
year 1997, the Administration will rely heavily on collaborative 
decision-making processes with all major stakeholders--i.e., 
appropriate Federal, State, local regulatory agencies and legislative 
bodies, business and industry groups, other Federal land managing 
agencies, foreign governments and environmental agencies (in the case 
of the United States-Mexico Aerosol Study) and the public--to develop 
alternatives in determining its approach to air quality management 
around the three study areas. The NPS is already an active participant 
in numerous multi-stakeholder, regional (and international) 
partnerships that have been formed to carry out these and other studies 
and to formulate appropriate solutions to air quality management 
problems facing national parks.
    Question. What mitigation measures are being employed to stop or 
stall the spread of exotic plants and animals in the national parks?
    Answer. While individual parks conduct many control activities, 
there is currently no Servicewide program in place to control exotic 
plants and animals. However, some examples include herbicide 
applications to control exotic plants, and beneficial (biological 
control) insects have been released at dozens of parks. Several western 
parks require horse and mule owners to use hay which is certified to be 
free of weed seeds. The NPS has played an active role in developing 
``Pulling Together A National Strategy for Invasive Plant Management'' 
and has assisted with several Congressional briefings, developed park-
specific educational materials and helped fund other educational 
materials. St. Croix National Scenic River in Wisconsin has an 
aggressive education campaign and boat inspection program to prevent 
the introduction of zebra mussels. Eastern parks use funds transferred 
from the Forest Service to spray gypsy moths and hemlock wooly 
adelgids. Wild pigs have been eliminated from Channel Islands National 
Park in California and are being managed at Great Smoky Mountains 
National Park in Tennessee and at the Hawaii Parks. Fencing is being 
constructed at White Sands National Monument in New Mexico to control 
gemsbok. $100,000 is requested for the Northwest Ecosystem Office.
    Question. Does this office have any association with the former 
Office of Forestry and Economic Assistance located in Portland?
    Answer. This Administration established two offices in Portland, 
Oregon in support of the Northwest Forest Plan. One office, the U.S. 
Office of Forestry and Economic Development in Portland, dealt 
primarily with economic assistance to the States and local communities 
that were affected by the Northwest Forest Plan. After publishing its 
final report to the President and Congress, the Economic Development 
office closed, as scheduled, in December 1996. The second office, the 
Regional Ecosystem Office, is an operating, multi-agency office that 
works for various Federal land and regulatory agencies that have 
responsibility for implementing the Northwest Forest Plan. While both 
offices were part of the Northwest Forest Plan, they worked separately 
and on different aspects of the plan.
    The estimated number of acres of park land which have been 
inventoried to current scientific standards for archeological resources 
is 1.5 million.
    Question. What is the long term timetable to obtain an inventory of 
the total acres needed to be assessed?
    Answer. Beginning in 1992, each NPS Region developed a plan 
establishing long-term strategies and priorities for conducting 
archeological inventories on park land within the Region. The plans 
currently are being reviewed and revised to reflect NPS's new cluster-
level organization. The plans contain a ranked list and schedule of 
needed archeological inventory projects. The inventory program is a 
long term one that will take many decades to complete, depending upon 
the funds available each year to undertake projects.
    The agency proposes $750,000 for finalization of the Cultural 
Landscapes Inventory Procedural Guidance Manual.
    Question. Once the manual is finalized, what are long term 
inventory plans? Be specific relative to timing and cost.
    Answer. Development of the Cultural Landscapes Inventory Procedural 
Guidance Manual is only a small part of the $750,000 allocated in 
fiscal year 1997 for the Cultural Landscape Inventory (CLI). Also 
included is finalizing the development of the associated database, 
Cultural Landscapes Automated Information Management System (CLAIMS); 
conducting CLAIMS training; and ongoing inventory field work 
Servicewide.
    Long-term inventory plans include performing the CLI research and 
field work Servicewide in accordance with the goals of NPS Strategic 
Plan and the GPRA; entering collected data into CLAIMS; refinement of 
CLAIMS management queries and reports; and training to maintain high 
professional standards regarding the information collected. Each region 
has prepared implementation plans establishing long-term strategies and 
priorities for performing the CLI research, field work, and data entry.
    The NPS anticipates this process will take in excess of a decade. 
The total costs associated with the long-term plans are unknown, due to 
the unknown quantity of resources that will be available. In order to 
be more specific regarding timing and costs, a goal has been 
established to complete reconnaissance surveys of all parks by the end 
of fiscal year 1999 to identify the potential scope of cultural 
landscapes in the National Park System.
    The agency states that funding to provide enforcement protection of 
fossil resources has been minimal while documented violations have 
increased.
    Question. How will the proposed increase of $2.5 million affect 
these protection efforts?
    Answer. The $2.5 million increase refers to the estimated increase 
in budgetary resources proposed in fiscal year 1998 to address the 
``resource protection'' program component of the budget subactivity 
``Resource Stewardship.'' Most of this funding ($1.5 million) would 
cover the increased benefit costs for NPS rangers who have been 
appropriately shifted to a new retirement plan similar to that provided 
for other law enforcement officers.
    The remaining $1.0 million reflects an estimate of the ``resource 
protection'' share of the funding requested for park base operational 
activities in fiscal year 1998. The total amount requested within park 
management is $24.4 million and would allow a one percent across-the-
board increase for all park units to maintain current program 
capabilities and selectively address unfunded, high-priority needs at 
63 individual units. Examples of parks proposed for increases which 
would involve resource protection activities include Cape Hatteras 
National Seashore, Kenai Fjords National Park, Florissant Fossil Beds 
National Monument, Whiskeytown National Recreation Area, and Manzanar 
National Historic Site.
    The Park Service just completed its Servicewide strategy for 
management of exotic vegetation. The NPS has a prioritized list of park 
projects that for potential funding. It is estimated that current 
funding has met less than 10 percent of the documented need.
    Mining operations are expected to increase in the California desert 
parks.
    Question. What long term staffing and funding needs will be 
necessary to manage the Desert mining program?
    Answer. At this time it is difficult to discern future long-term 
staffing and funding needs beyond the current baseline of active mining 
operations, number of proposed mining operations, abandoned mine sites, 
and associated resource impact issues. The fiscal year 1998 program 
increase request for salary and support costs for six FTE ($580,000), 
combined with the increase for Mojave National Preserve ($318,000 and 5 
FTE) is the minimum necessary to meet currently anticipated 
specialized, technical assistance needs of the Desert park units. The 
six FTE in the Servicewide program will serve the parks in various 
technical capacities, including conduct of claim validity examinations, 
regulatory and policy guidance, mine land reclamation, and hazardous 
substance toxicology and remediation. However, events beyond Park 
Service control (e.g., significant price increase of mineral 
commodities, increased demand, and development of more cost-effective 
mining technologies) could result in more proposed operations beyond 
the current and projected level, thereby increasing the need for 
additional NPS staff and funding resources to handle management 
demands.
    If an unanticipated increase in mining activity occurs, NPS will 
need additional FTE and support funds to conduct the requisite mining 
claim validity examinations to verify whether a claimant possesses a 
bona fide mineral right and to process proposed plans of operations. In 
addition, NPS may need funding to acquire mining claims if future 
mineral development of specific claims will be in derogation of park 
resources and values.
    Mojave National Preserve's fiscal year 1998 program increase 
request for salary and support costs dedicated to mining claims 
management should meet the current and future park-based workload. 
However, fiscal year 1998 park-based program increases do not address 
long-term mining claims management staffing and funding needs at Death 
Valley and Joshua Tree National Parks.
    Question. Is the proposed addition of six FTEs sufficient?
    Answer. As addressed above, salary and support cost increases for 
six FTE in the Geologic Resources Division will meet current technical 
assistance needs in the California Desert park units. The fiscal year 
1998 program increase proposed for Mojave National Preserve should meet 
current and future park-based mining claims management program needs. 
Death Valley and Joshua Tree National Parks may need additional mining 
claims management FTE depending upon the number and frequency of future 
mining operation proposals.
                            visitor services
    Interpretive and education programs are provided at all 374 units 
in the system.
    Question. How many units present this information only through 
displays (without personal contact with employees or volunteers)?
    Answer. It is difficult to separate the units with only non-
personal services (exhibits, wayside exhibits, publications) from those 
with personal (ranger-led programs) and non-personal services. There 
are approximately 324 staffed sites which offer both types of visitor 
experiences. Only the smallest of sites offer just displays. Parks such 
as Shenandoah National Park offer all types of display services and 
interpretive staff. Others such as Theodore Roosevelt Island have a few 
wayside exhibits but no permanent staff and the Netherlands Carillon 
only has a single wayside exhibit. There are a small number of sites 
that offer only information displays and no permanent onsite staffing.
    Question. Are there more such units today than in the past?
    Answer. Small, unstaffed sites, in the past, were usually added to 
the System through boundary changes and other adjustments affecting 
larger NPS units. Areas added to the Park System in the past five years 
such as Washita Battlefield and Nicodemus National Historic Sites will 
be staffed by permanent NPS personnel. These areas will likely also 
feature wayside exhibits to assist in interpreting events that took 
place at various locations at these park areas.
    Question. What is the past five year data on this question?
    Answer. The NPS does not maintain historical information on the 
number of units that present interpretive information without staff 
resources. However, information is maintained on the demands for non-
personal service displays, publications, and the workloads involved in 
production. A survey completed in June 1995 indicated the Service had 
791 visitor center exhibits, 10,618 wayside exhibits, 1,233 media 
programs, 370 folders, and 163 park handbooks. This Harpers Ferry 
Center Interpretive Media Rehabilitations Survey defines the media 
rehabilitation needs for the Service in each category. The following 
statistics represent the work accomplished over the past five years in 
the area of non-personal services. A very small portion of this work 
was accomplished for non-staffed NPS units.

                                                  PUBLICATIONS                                                  
----------------------------------------------------------------------------------------------------------------
                                                                                                   NPS folders/ 
                 Fiscal year                   Units print   Quantity printed    Total visitors      visitors   
----------------------------------------------------------------------------------------------------------------
1992.........................................          221         20,142,000        274,694,549            1:14
1993.........................................          259         25,609,900        273,120,925            1:11
1994.........................................          247         31,117,000        268,636,169             1:9
1995.........................................          243         27,965,500        269,564,307            1:10
1996.........................................          218         29,532,050        265,713,599             1:9
----------------------------------------------------------------------------------------------------------------


                                                WAYSIDE EXHIBITS                                                
----------------------------------------------------------------------------------------------------------------
                                                                                     Waysides                   
                           Fiscal year                           -----------------------------------------------
                                                                        New        Rehabilitated       Total    
----------------------------------------------------------------------------------------------------------------
1992............................................................             606             417           1,023
1993............................................................             961             370           1,331
1994............................................................             433             259             692
1995............................................................             570             109             679
1996............................................................             503             217             720
----------------------------------------------------------------------------------------------------------------

Total exhibits completed--new and rehabilitated

        Fiscal year                                             Exhibits
1992..............................................................    25
1993..............................................................    13
1994..............................................................    10
1995..............................................................    28
1996..............................................................    39

    Question. Is the ``Parks as Classrooms'' program utilized away from 
park units?
    Answer. Yes, the Parks as Classrooms program is an integrated, 
curriculum based activity that is designed to meet local school 
curriculum and classroom needs. The program is typically made up of 
three activities: (1) a pre-site visit by a Park Service interpreter to 
the classroom where students are prepared for an on-site learning 
activity, (2) an on-site learning experience at the park, and (3) a 
follow-up activity where the learning experience is evaluated. The park 
interpreter works closely with the classroom teacher to assure that the 
teaching/learning objectives are met. Many parks also produce theme-
related teaching materials such as traveling trunks, teaching kits, 
interactive CD-ROM programs and teaching materials which are sent to 
schools. The Park Service is also using its Internet website, ParkNet, 
and has recently entered into an agreement with NASA's Goddard Space 
Center to provide cooperative education materials and programs 
nationwide.
    Question. Is this program presented in urban non-park areas?
    Answer. Yes, all urban national park sites provide some degree of 
outreach programs to urban populations. For example, Santa Monica 
Mountains National Recreation Area in Los Angeles participates in the 
``Wonderful Outdoor World'' program which provides outdoor learning and 
camping experiences for youth in their own inner-city neighborhood. At 
Independence National Historical Park in Philadelphia, park personnel 
offer an outreach program called the ``Traveling Ambassador'' which 
takes programs on jobs, history, and the National Park System to the 
inner-city. During the 1996-97 school year, the program was presented 
to over 7,000 students in 54 schools. Ecology Village at Gateway 
National Recreation Area in New York City offers off-site programs to 
over 3,000 children from January to March while the park's Outreach 
Office provides programs to thousands more throughout the year.
    There are similar programs at Golden Gate National Recreation Area 
in San Francisco; Martin Luther King National Historic Site in Atlanta; 
Jefferson National Expansion Memorial in St. Louis; Lake Mead National 
Recreation Area near Las Vegas; Jean Lafitte National Historical Park 
and Preserve in New Orleans; and Boston National Historical Park in 
Boston. Some urban area parks such as those found in Washington, D.C., 
work with other organizations such as Project Learning Tree, Project 
Wet/Wild, and Urban Tree House to provide educational programs off park 
lands in urban settings. Many parks also offer drug prevention programs 
to urban school groups.
    A Departmental OIG report found that NPS has failed to do an 
adequate job of recovering costs of emergency services from 
beneficiaries. The report states that ``at least $4.5 million were not 
recovered,'' and ``fee collections totaling $757,800 were 
inappropriately retained by park units''.
    Question. What action is the agency taking to rectify this problem?
    Answer. The NPS disagreed with the Office of Inspector General 
Report (96-I-806) recommendation which we felt was in opposition to 
Congressional intent behind current law (28 U.S.C. 2671 et seq.), under 
which NPS has discretion to provide emergency medical services. Loss of 
such discretion would result from a practice of charging for emergency 
services, consequently extinguishing the immunity Congress intended for 
these activities. The Department has taken this matter on itself for 
resolution, and NPS is awaiting the Department's decision.
    Question. What specific changes will be made in billing procedures 
to improve collections and make a more consistent process?
    Answer. The NPS agreed to make the proper deposits into the 
miscellaneous receipt accounts of the U.S. Treasury, but disagreed that 
emergency search and rescue fees or emergency medical fees should be 
collected, absent willful and wanton negligence on the part of the 
lost, rescued, or injured visitor.
    Question. How extensive is the problem of illicit drug 
manufacturing on park lands?
    Answer. The NPS has had, and continues to have, a significant 
impact in the campaign to halt illegal drug production on National Park 
lands. As a result of numerous sustained law enforcement initiatives 
implemented by NPS there are indications that a number of marijuana 
growers have either stopped growing marijuana or have moved their 
operations from NPS lands onto private land or indoors.
    In Hawaii, drug producers avoid national park lands for fear that 
they will be caught by park rangers, convicted in Federal Court, and 
sent to mainland prisons. Rangers have waged a relentless ``Marijuana 
Campaign'' since 1986 on marijuana growers who have historically used 
park lands as their garden sites. These joint eradication operations 
have been so successful that, today, most growers admit that NPS lands 
in Hawaii are off limits to the production of marijuana. The parks 
continue to produce large numbers of plant seizures and arrests.
    The NPS Southeast Region is now the most prolific marijuana 
producing area in the System. Park rangers are producing a continuous 
stream of marijuana production cases. Efforts have increased 
significantly in 1997 to reduce this illicit crop and to arrest those 
responsible. In recent years the Big South Fork National Recreation 
Area has been used for the growing of marijuana plants. Joint 
eradication operations with the Forest Service on the Tennessee and 
Kentucky border have seriously affected the local drug economy and 
resulted in the destruction of large numbers of marijuana plants.
    The NPS areas located on the United States/Mexico border are 
aggressively pursuing counter-drug operations with a sustained year-
round effort. The U.S. Customs Service and the Border Patrol have 
provided cross training to the rangers with the Customs Service 
providing some cross delegation authority for the rangers. Smuggling 
activities continue and the violence appears to be escalating. Most 
smuggling cases are considered far more dangerous than marijuana 
cultivation because most smugglers are Mexican nationals who are more 
accustomed to violent conflicts with police in Mexico.
    The NPS anticipates continued violent contacts with growers and 
smugglers in the future. The park rangers assigned to the border parks 
are better trained and equipped than they were five years ago. Most of 
these border and marijuana growing park areas have one or two rangers 
who have experience and training in the areas of smuggling and 
surveillance of suspected growth locations.
    Based on Park Service jurisdiction the agency is required to 
enforce all Federal laws and regulations within park units.
    Question. Is there any significant cooperation occurring with local 
authorities on Park land?
    Answer. Yes; NPS is working with a number of local task force 
operations which are being used to conduct coordinated counter-drug 
operations. The NPS is also assisted by the military in a support mode 
where the military provides transportation and other non-law 
enforcement support when requested. The NPS is transitioning to more 
electronic surveillance of the areas where drugs are grown or 
manufactured thus saving overtime costs and operating funds until they 
are actually needed. For the most part, all operations of this nature 
occur within park boundaries. The drug problem has increased in the 
last three years with the production of marijuana on the increase on 
park lands. Special emphasis is being undertaken to eliminate this 
activity, not only due to its illegality but because this farming 
method also causes harm to the park environment.
    Question. To what extent can State and local statues be enforced on 
park land?
    Answer. In areas of proprietary jurisdiction, the State may enforce 
State law, but generally chooses to leave NPS to provide the level of 
enforcement activity that is called for on park land. In areas with 
concurrent or exclusive jurisdiction, NPS cooperates with the United 
States Attorneys Offices that handle court prosecution of violations. 
The decisions regarding jurisdiction are made by Department of Justice 
personnel. For the most part, States consider the parks responsible for 
enforcement actions within park boundaries. Cooperation is excellent 
between NPS and State and local law enforcement officials. 
Additionally, NPS does not volunteer to operate outside its boundaries 
or jurisdiction unless in a cooperative capacity with our State and 
local counterparts.
    Question. Will the agency make increased use of visitor 
transportation systems at more park units in the future?
    Answer. There will be increased use of these systems in park units 
in the future due to growth in park unit visitation and limited funds 
for improving park roads and providing additional parking. In many 
instances roadways cannot be widened or parking areas enlarged to 
accommodate private vehicles because of the need for resource 
protection and other environmental constraints.
    A new visitor transportation system will become operational in Zion 
National Park and systems will be expanded in Grand Canyon and Yosemite 
National Parks in the near future. System planning has been undertaken 
in special studies or in NPS General Management Plans for: Acadia, 
Crater Lake, Sequoia, Mount Rainier, and Yellowstone National Parks; 
Indiana Dunes National Lakeshore; Presidio (Golden Gate National 
Recreation Area); and Bandelier National Monument.
    While there has been major storm damage to facilities at Yosemite 
National Park, there is an opportunity to implement restoration efforts 
which will enhance the outstanding values. A significant aspect of this 
opportunity involves planning the visitor transportation system. The 
fiscal year 1997 Supplemental appropriations bill contains funds for 
repair and restoration of visitor transportation systems.
    Question. What long term plans are being made to implement the best 
possible transportation system?
    Answer. The NPS is working to identify options for a regional 
system through its involvement in the Yosemite Area Regional 
Transportation Strategy (YARTS). The YARTS is currently conducting 
public workshops to help in proposing a level of service for the 
forthcoming plan for a regional system. The local system that will move 
people around Yosemite Valley will be defined through the NPS Valley 
Implementation Plan, which is scheduled to be released for public 
comment in September 1997. This plan is considering an in-valley 
transfer and staging area. A transfer facility in Yosemite Valley is 
needed to provide the linkage between the local in-park system and the 
regional system. The staging (parking) area is being considered as a 
potential interim facility to be constructed and reduced in size with 
the maturation of a regional system. If a regional system develops 
concurrently, then NPS can elect not to construct parking or to 
proportion it based upon the capabilities of the regional system.
    Question. What is the Park Service's ongoing relationship with 
local communities in the planning of the transportation system?
    Answer. The NPS has a formal relationship with its gateway 
communities through its membership on the YARTS board, which consists 
of representatives of Madera, Mariposa, Merced, Mono, and Tuolumne 
counties, Cal Trans, the Federal Highway Administration, Forest 
Service, and NPS. Citizens, such as business and environmental 
interests, also are invited to participate.
    Question. To what extent will the supplemental funds involve local 
communities in the planning of the system?
    Answer. Local communities will be invited to help NPS define the 
criteria and decision points for whether to develop in-valley parking, 
the size of such parking capacity, and the conditions under which to 
downsize parking facilities based on the capabilities of the regional 
system. The NPS will also invite participation from businesses and 
environmental interests, representatives of State and Federal agencies, 
and staff from the offices of the California Congressional delegation.
    Question. Will short term ``fixes'' to the storm damage affect long 
term transportation system options?
    Answer. The repairs undertaken at the park will assure that NPS is 
prepared to link with the long-term regional transportation system if 
such a system is developed in the future. If a regional system were to 
move forward without additional in-valley shuttle buses, then our bus 
capacity would be less than half of that required to effectively move 
the number of visitors that come to Yosemite Valley. Our system is 
currently designed to handle the numbers of people that we can get out 
of their cars and into our bus system, not the number that would be 
utilizing the system under a planned transportation system, where 
automobiles would no longer be used to move about the valley. A 
transfer facility would provide a point of linkage with a regional 
system. A parking area, developed under the criteria mentioned above, 
would be reduced in size and possibly not constructed at all based on 
the capabilities of the regional system.
    Question. Has NPS considered the use of advanced alternative fuel 
vehicles, such as Fuel Cell buses?
    Answer. Currently, two electric buses are in operation in Yosemite 
Valley and two more have been ordered. The supplemental funds will be 
used to purchase electric buses and possibly compressed or liquid 
natural gas buses. Because of the demands that will be placed on that 
system, fuel cell technology is not economically feasible at this time. 
Should the cost be reduced in the future, the electric buses that NPS 
has acquired would be able to take advantage of that technology.
    Question. Of all the agency's facilities used by the public, what 
percent are fully accessible to persons with disabilities?
    Answer. In 1983, NPS established an official policy statement that 
asserted that, ``it is the policy of NPS to provide the highest level 
of accessibility in all visitor and management buildings and facilities 
as is possible and feasible, consistent with the nature of the area and 
facility.'' Over the past several years, NPS has conducted an extensive 
program of education and technical assistance to help the parks 
understand what they should be doing and the methods and techniques for 
doing it appropriately and effectively. Over the past several years, 
most of the parks have conducted evaluations to identify barriers to 
access and have made some modifications and corrections, utilizing 
existing operating funds. Unfortunately, NPS has not conducted a 
comprehensive evaluation of all of its facilities to determine if all 
facilities are 100 percent accessible to persons with disabilities.
    Question. Is there a timetable for achieving 100 percent 
accessibility? If so, what is that timetable?
    Answer. Presently, there is no time table to achieve this level; 
however, all significant modifications and new construction must be in 
compliance with current code related to handicapped access.
    Question. If so, what is that timetable? What are the costs?
    Answer. In 1988-89 NPS asked each park to conduct a ``self-
evaluation'' of their facilities and programs, utilizing the best 
information available at the time. Using the information generated by 
that evaluation, NPS made some estimates of the cost for correcting the 
access barriers that were identified and projected the cost for 
systemwide improvements. At that time, NPS estimated that it would need 
between $60 and $100 million to bring all of its facilities into 
compliance. However, that estimate was not comprehensive and actual 
costs could be more or less than that amount. Employee compensation 
costs are expected to increase by $1.7 million.
    Question. What is the agency's historic worker's compensation costs 
for the past five years?
    Answer. The NPS actual Worker's Compensation Payments for the past 
five years were as follows:

NPS actual worker's compensation payments

                                                           Whole dollars
1992..........................................................$9,364,000
1993..........................................................10,249,000
1994..........................................................11,816,000
1995..........................................................12,332,000
1996..........................................................14,345,000

    Question. What specific action is the agency taking to reduce these 
costs?
    Answer. The NPS has adopted the following strategy to address the 
issue: (1) the National Leadership Council has committed itself to 
ensuring that all new workers' compensation cases are managed; (2) it 
is the Service's strategic plan goal under GPRA to reduce the cost of 
new workers' compensation cases by 50 percent by 2002; (3) a Workers 
Compensation Case Management Guideline has been drafted and will be 
issued servicewide along with a supportive training video; (4) training 
for case managers is being planned; and, (5) the Department is 
identifying cases on the long-term disability roles that are 
recommended for intervention. The NPS will focus on bringing personnel 
on this list back to work. The limiting factor is lack of funds to 
support FTE for personnel brought back to work, and the lack of 
personnel to manage these cases, but both some of the funding for these 
needs are requested in NPS fiscal year 1998 budget. The NPS is also 
recruiting for a Workers' Compensation Case Manager as a point of 
contact for case management and as a liaison between NPS and the U.S. 
Department of Labor, Office of Workers' Compensation.
    Question. Does the agency have an aggressive program to return 
former employees to positions which will result in reducing 
compensation costs?
    Answer. The NPS has proposed increased funding of $320,000 in 
fiscal year 1998 for the Office of Workers' Compensation Program 
(OWCP). The proposal outlines a complementary program to the 
Department's current policy which provides FTE for two years to 
organizations wishing to reemploy injured workers who have obtained new 
skills. The NPS program would provide funding for those positions, also 
for a two-year period. At the end of the two-year period, the FTE would 
be returned and made available for use by other park units or offices. 
The request would fund nine positions servicewide.
    Question. What are Departmentwide statistics relative to this 
issue?
    Answer. The Department's actual Worker's Compensation Payments for 
the past five years were as follows:

Department's actual worker's compensation payments

                                                           Whole dollars
1992....................................................     $35,126,916
1993....................................................      36,452,000
1994....................................................      40,528,288
1995....................................................      42,282,473
1996....................................................      44,661,217

    The agency manages 18 percent of the land on the border with 
Mexico.
    Question. Have there been increased impacts to NPS lands as a 
result of illegal immigration and drug smuggling?
    Answer. Yes, NPS has found that increased foot traffic has degraded 
park features as well as contributed to littering and resource 
degradation in park areas. Drug smuggling has also made nighttime 
activity in these parks extremely dangerous and campground thefts have 
also increased.
    Question. Does the Border Patrol cooperate with the Park Service in 
the apprehension of illegal entrants?
    Answer. Both the Border Patrol and NPS work together to investigate 
border crimes and to apprehend those individuals entering the United 
States illegally. The NPS has an interest in protecting park resources 
which prevents the use of some Border Patrol vehicles for routine 
patrol activity; these areas are patrolled by NPS on foot.
    Question. Does the NPS utilize State, local, or other Federal 
agency law enforcement dispatch and radio systems for use by law 
enforcement rangers? If not, why not?
    Answer. Yes, in locations where there are dispatch and radio system 
resources are available. However, for the most part, State and local 
agencies do not position there communication operations on border areas 
where parks are located. The NPS, in a number of areas, provides 
communication support, dispatch services, and similar assistance for 
other agencies in ``dead areas'' where State and local communication 
systems do not work. The Park Service works closely with the U.S. 
Customs Service and in some cases shares communications systems. The 
NPS has also received grants to upgrade communication systems for 
cooperative counter-drug work.
    Question. Has the agency investigated the prospect of shared law 
enforcement communication?
    Answer. Yes, NPS has, when possible, joined with other agencies and 
local departments to share communications systems. The main problems 
are that State and Federal radio frequencies and radio equipment often 
are not compatible. For example, NPS has a presence in a consolidated 
Federal facility in Riverside, California, which is comprised mostly of 
Federal law enforcement, fire, and other law enforcement agencies. The 
NPS also shares a facility in Flagstaff, Arizona, which covers NPS, 
BLM, and Forest Service sites.
                              maintenance
    A $13.5 million increase is requested in the Operational 
Maintenance program in fiscal year 1998, which includes a net 
programmatic increase of $7.3 million.
    Question. What is the past five year history of funding in this 
area?
    Answer. The total funding enacted for Operational Maintenance over 
the last five years was as follows.

Operational maintenance--enacted amount

        Fiscal year                                         In thousands

1997..........................................................  $295,830
1996..........................................................   275,788
1995..........................................................   273,842
1994\1\.......................................................   301,086
1993..........................................................   271,078

\1\ In fiscal year 1994, NPS restructured its budget and budget 
monitoring system to more accurately reflect costs in various functional 
areas. In fiscal year 1995, after using the new structure and reporting 
mechanism for a year, functional amounts were revised to reflect the 
results of this use. In doing so, the amount estimated for operational 
maintenance was adjusted downward by about 10 percent. Subsequent 
monitoring activity in fiscal year 1996 confirmed the accuracy of this 
revision, in effect verifying the overestimates of the previous years.

    Question. How will the increase be allocated to specific park 
facilities?
    Answer. The $7.3 million in programmatic increases requested for 
fiscal year 1998 will be distributed to a number of parks based on 
needs identified by specific parks. The parks receiving this and other 
park base funding are listed and their funding need identified and 
justified in NPS budget justifications. Examples of the parks that are 
proposed to receive this funding include areas such as Antietam 
National Battlefield, Canyonlands National Park, Chickasaw National 
Recreation, Mount Rushmore National Memorial, and Natchez Trace 
Parkway.
                              park support
    The use of volunteers is estimated to increase to 90,000 in fiscal 
year 1997.
    Question. Has the agency had difficulty locating volunteers to 
perform work?
    Answer. No; the NPS's Volunteers-In-Parks Program continues to 
experience growth in popularity. The NPS is attempting to increase the 
numbers of volunteers with specific skills relevant to NPS mission. To 
that end a ``Volunteer Opportunities'' homepage has been recently 
established on the Internet to allow individuals interested in the 
program to have direct access to existing volunteer vacancies. The 
following statistics represent the development of the VIP Program 
between 1992 and 1996.

                              DEVELOPMENT OF THE VIP PROGRAM BETWEEN 1992 AND 1996                              
----------------------------------------------------------------------------------------------------------------
                                                                      Number of volunteers--                    
                           Fiscal year                           -------------------------------- Percent annual
                                                                       Total           Hours          growth    
----------------------------------------------------------------------------------------------------------------
1992............................................................          73,350       3,057,660               4
1993............................................................          78,500       3,204,880               7
1994............................................................          80,743       3,471,418               3
1995............................................................          79,497       3,289,153              -2
1996............................................................          89,242       3,468,903              12
----------------------------------------------------------------------------------------------------------------

    The total number of projects in the challenge cost-share program 
has remained constant for fiscal year 1995-1997.
    Question. What is the future potential to increase the number of 
projects in future years?
    Answer. The number of projects have remained relatively constant 
primarily because the amount of funds earmarked for the Challenge Cost-
Share Program have remained the same at $1.8 million. The NPS attempted 
to increase the number of projects funded starting in fiscal year 1996 
and fiscal year 1997 by emphasizing in our implementation instructions 
to Regional Office selecting officials that all programs and projects 
of the Service, both inside and outside of parks, were now eligible for 
funding, and also by reducing the Federal share maximum contribution 
from $40,000 to $30,000.
    However, despite the relatively constant numbers of projects funded 
with challenge cost-share money, parks and programs consistently 
receive more than twice the number of applications than can be funded 
by the $1.8 million.
                        wildland fire management
    The agency proposes a funding increase of $2.5 million which will 
result in operations at 88 percent of the most efficient level (MEL).
    Question. What level is the agency operating at in fiscal year 
1997? Assuming this level is less than the 88 percent goal for fiscal 
year 1998, what consequences have occurred due to this lower level? How 
does the 88 percent goal compare to requests made by other land 
management agencies?
    Answer. The Park Service Budget Justification provides a summary of 
likely funding allocations from BLM to the NPS Wildland Fire 
Preparedness and Wildland Fire Operations budget activities. The 
ultimate allocation is subject to the final 1998 appropriation made to 
the BLM Wildland Fire Management account. At the request level 
contained in the President's Budget, all four Interior bureaus would be 
allocated amounts at roughly equal levels of preparedness, based on 
historical use patterns for equipment, salaries, and the other costs 
that figure in the calculation of the most efficient level (MEL). At 
the request level, this would equal about 85 percent of MEL, up from 84 
percent in 1997.
                         historic preservation
    An increase of $9.4 million is requested for the grants-in-aid 
program.
    Question. When providing matching funds for historic preservation 
efforts, is the ratio of matching always 1:1, or does it vary?
    Answer. The ratio it is not always 50 percent Federal and 50 
percent non-Federal matching share. Section 101(e)(1) and 101(e)(2) of 
the National Historic Preservation Act authorize ``matching grants'' to 
State Historic Preservation Offices (SHPO's) and to the National Trust 
for Historic Preservation, respectively, and Section 102(a)(3) 
stipulates that grants to SHPO's may not exceed 60 percent Federal 
share.
    However, Section 101(e)(3)(B) of the National Historic Preservation 
Act authorizes direct grants to ``nonprofit organizations representing 
ethnic or minority groups for the preservation of their cultural 
heritage.'' While Section 101(e)(3) is silent about a matching share 
requirement for direct grants, it is within the Secretary's 
administrative authority to require a non-Federal matching share. The 
$4.3 million cumulative total of grants awarded to historically black 
colleges and universities in fiscal years 1995 through 1997 were made 
to the United Negro College Fund (UNCF), which raised most of the $4.3 
million non-Federal matching share in accordance with the Memorandum of 
Agreement then in effect between NPS and the UNCF, and subgranted the 
funds to individual colleges.
    However, Section 507 of Public Law 104-333, the Omnibus Parks and 
Public Lands Management Act of 1996, authorizes $29 million in grants 
and identifies 12 HBCUs selected by Congress. Public Law 104-333 also 
provides authority for the Secretary to waive the non-Federal matching 
share requirement. Recent discussions between NPS, UNCF, and the 12 
HBCU's indicate that neither the HBCU's nor the UNCF can promptly raise 
the 50 percent matching share that has been contributed for previous 
HBCU grants.
    Question. If it does vary, please provide a project specific list 
for fiscal year 1998 showing the matching fund shares.
    Answer. As indicated previously, NPS does not vary the matching 
share ratio except as prescribed by the National Historic Preservation 
Act. For fiscal year 1998, it is still too early to know how much 
funding the UNCF will raise for HBCU's.
    Question. What process is used to award grants under this program?
    Answer. The $4.3 million in HBCU grants awarded during fiscal years 
1995 through 1997 were selected based upon the following criteria: (1) 
the building was listed in the National Register of Historic Places; 
(2) the building possessed greater architectural and historical 
significance than other HBCU structures; and (3) the building was in 
such a State of disrepair that, if structural deficiencies remained 
uncorrected, then the structure would be critically endangered. As a 
result, 11 of the most historically significant and threatened 
structures were evaluated by a joint Department of the Interior-private 
sector field assessment team and ranked in order. Seven of the 11 HBCUs 
selected have received grants during 1995-97. Section 507 of Public Law 
104-333, the Omnibus Parks and Public Lands Management Act of 1996, has 
identified 12 HBCU's and has authorized specific amounts for these 
individual HBCU's ($22.9 million was earmarked for the 12 schools from 
the $29 million total authorization). The Administration has requested 
a $9 million increase in HBCU grants for fiscal year 1998, and proposes 
to award grants to the 12 schools in the order they were listed by 
Congress in Section 507 of P. L. 104-333. This would be a multi-year 
effort; in order to complete enough work to make each building safe and 
usable, only three HBCU's could be assisted with the funds requested in 
fiscal year 1998.
                              construction
    The requested allocation for the construction program calls for a 
$20.7 million decrease.
    Question. What affect will this decrease have on the construction 
backlog?
    Answer. The NPS has requested over the past number of years a Line 
Item Construction program level of $80 to $100 million worth of high 
Servicewide construction priority projects as well as other projects 
which can be linked to eliminating deteriorated conditions and 
achieving park development goals. This amount of funding is what NPS 
expects to accomplish each year given its planning and contracting 
abilities and workloads. The $20.7 million reduction from the Line Item 
program appropriation does not represent a decrease in the Service's 
effort to reduce the backlog. It is, in fact, an increase of $5.8 
million over our fiscal year 1997 request.
    Question. What are projections for income from the Recreation Fee 
Demonstration project that will be allocated to construction projects?
    Answer. The President's Budget anticipated that the Recreation Fee 
Demonstration project would raise $48 million in fiscal year 1998; 
however, since that estimate was made, Congress has amended the program 
in ways that provide for additional revenue. At this time, however, it 
is too early to know how much will be allocated to construction and how 
much will fund simple repair and rehabilitation projects.
    Question. What are projections for allocation to maintenance 
projects?
    Answer. As noted above, revenue from the demonstration fee program 
will be used to fund various high priority park projects, however, 
funding to be allocated to any particular program has not been 
determined.
    The agency has been involved in a recent consolidation of design 
services with BLM and FWS.
    Question. How is this consolidation working in terms of efficiency, 
project timing, and the ability to coordinate and prioritize between 
agencies?
    Answer. The BLM and FWS are co-locating with NPS. In December 1996, 
FWS completed their move into NPS building. The BLM will complete their 
move into NPS building by July 1997. This physical co-location of 
bureaus affords all bureaus the opportunity to share and make efficient 
use of NPS technical support systems. These systems include telephones, 
computer LAN, micrographic reproductive services, technical information 
databases, and interagency contracts. Even though each bureau continues 
to maintain the lead on their construction program, overall project 
timing is expected to improve. The co-location affords greater 
opportunity for all project mangers to confer about alternative ways to 
schedule and sequence their projects. This exchange of information and 
techniques across bureaus will allow work to be more uniformly produced 
through ``best practices.''
    The prioritization and coordination of work between agencies will 
be enhanced through the availability of a more technically diverse and 
singularly located workforce. Should there be a project that exceeds 
the capability or capacity of any one bureau, the sister bureau will be 
able to immediately assist. This sharing of technical expertise is 
currently happening through the archeological services NPS is providing 
to FWS.
    An increase of $3.5 million is planned for equipment replacement. 
The agency justification states that a total of $3.5 million is 
proposed for allocation to narrow band radio conversion and information 
management equipment modernization.
    Question. Does this represent the total $3.5 million increase?
    Answer. The increase would be devoted to only these two areas; $3.0 
million of the additional $3.5 million would be used to initiate a 
multi-year plan to modernize NPS computer hardware and software by 
placing this equipment on a scheduled replacement cycle and allowing 
the technology used by NPS to remain current for maximum effectiveness. 
The remaining portion of the proposed increase, $500,000, would be 
devoted to the implementation and testing of the narrow band technology 
for radio communications equipment in selected parks.
    The agency reports a $75 million vehicle/equipment replacement 
backlog.
    Question. How have vehicle maintenance expenses (for vehicles 
retained past planned life) been affected by this backlog?
    Answer. The current inventory of NPS equipment fleet identifies 
passenger cars, trucks, and heavy equipment that are operating well 
beyond their designed life expectancy. As equipment nears or reaches 
this stage, fleet operational costs increase. This is due in part to 
more frequent equipment breakdowns and more expensive drive train 
components wear out and have to be replaced, all resulting in more 
frequent and costly maintenance activities. This does not include the 
staff hours lost to efficiently perform work when equipment fails to 
perform.
                         everglades restoration
    The land acquisition program for the Everglades restoration project 
states that 58,000 acres will remain to be acquired after fiscal year 
1997. A request of $63.6 million is being made for fiscal year 1998 
land acquisition. The Administration is also proposing to establish the 
Everglades Restoration Fund which is expected to result in the receipt 
of $35 million for land acquisition.
    Question. What are long-term projections for the Everglades 
Restoration Fund in terms of reducing land acquisition requests from 
regular appropriations?
    Answer. The Everglades Restoration Fund consists of two components. 
First, is the request for direct appropriations of $100 million every 
year for four years, for a total of $400 million. The President's 
Budget had requested $100 million for fiscal year 1998, with the 
remaining funding requested as an ``advance appropriation.'' The second 
component consists of revenues of about $35 million per year as a 
result of enacting a sugar marketing assessment on Florida sugar 
producers. If enacted this year, the Department estimates that about 
$35 million would be available every year to acquire lands in the 
Everglades ecosystem. At some point, this income would reduce, but not 
eliminate, the requirement for direct appropriations to protect land in 
the Everglades region.
    Restoration of the Florida Everglades and the South Florida 
Ecosystem is a high priority of the Administration. Much of the program 
emerged during a time of contentious litigation with Florida's sugar 
industry. This required the industry to contribute a total of $312 
million towards this acquisition through the Restoration Fund. 
Successful implementation of the program requires extensive 
coordination with other Federal agencies as well as State and local 
governments and industry. Plans are very ambitious and involve a major 
effort to mimic, not restore, nature's processes.
    Question. What is the current overall status of the restoration 
effort?
    Answer. The Department believes that significant achievements have 
been made since the Administration established the South Florida 
Ecosystem Restoration Task Force in 1993. Lands that have been 
identified for protection are being acquired; scientific research is 
on-going; construction of the modified water delivery project for 
Everglades National Park continues; the Task Force has been expanded to 
include State, tribal, and local representatives; the Army Corps of 
Engineers' restudy of the Central and South Florida project continues; 
and an unprecedented level of partnership among Federal, State, tribal, 
and local governments is occurring.
    Question. How well is cooperation with other agencies and private 
parties working?
    Answer. As stated above, an unprecedented level of partnership is 
occurring among all the parties to the restoration effort. At the field 
level, Federal, State, tribal, and local representatives have formed 
work teams to address numerous issues that affect the restoration 
effort. Similarly, at the Washington level, there is coordination among 
all the parties.
    The NPS portion of the Everglades Restoration effort proposes $12 
million for science in fiscal year 1998. In fiscal year 1997, $8 
million will be spent on science.
    Question. If the agency is actively engaged in a major scientific 
study effort, is it getting the ``cart before the horse'' in 
implementing this major program?
    Answer. No, studies completed to date and the consensus of Federal, 
State, and local partners in the ecosystem restoration effort indicate 
that certain actions can and must proceed immediately while some 
scientific research remains on-going. Generally, completing Federal 
land acquisition, acquiring additional land outside Federal areas, and 
completing the modified water delivery project to restore a more 
natural hydrologic flow for Everglades National Park are three 
components of the Everglades Restoration Fund that do not require 
additional scientific study. In addition, these areas also comprise the 
majority, or $88 million, of the $100 million requested for the 
Everglades Restoration Fund, with the $12 million proposed for 
scientific research comprising the remainder.
    Question. How much confidence does the Department have in the 
scientific and engineering studies made so for, to be sure the attempt 
to mimic Mother Nature will actually work?
    Answer. The Department believes that the key to success of the 
restoration effort is in our ability to understand how the natural 
system functioned in the past and how man-made changes have affected 
that system. The knowledge gained from research efforts in these areas 
will guide future management decisions in an attempt to avoid similar 
mistakes in the future. The Department has a great deal of confidence 
that such research will allow it to design future systems that will 
replicate the natural system as much as possible.
                  recreation fee demonstration project
    This program will allow the Director of the Park Service to 
disperse 20 percent of the funds collected from a specific site to be 
distributed at sites on a service-wide basis.
    Question. What criteria will be used to determine the allocation 
process for this 20 percent?
    Answer. The Director has requested all units of NPS to submit 
priority projects for funding from the 20 percent funds available from 
the total new revenue collected from the Recreation Fee Demonstration 
project. A panel will be established to review and recommend selected 
projects for the Director's approval. Once approved by NPS, the 
Department will review the proposals and approve the selected projects. 
The ``20 percent'' money will be largely targeted at parks that do not 
collect fees or are not part of the demonstration program.
    Question. How will the recent the recent storm damage in Yosemite 
affect implementation of fee demonstration plans?
    Answer. The recent storm damage in Yosemite affected the fee 
demonstration program only by causing a two month delay in implementing 
the program in Yosemite. Yosemite's visitation figures, however, are 
showing a decline that is greater than anticipated. The NPS is now 
doing a formal estimation of what this will mean to Yosemite's 
projected income, based on two full months of normal operation after 
the flood. The best current estimate is that the impacts of the flood 
will cost Yosemite nearly $2 million in returned revenue this fiscal 
year.
    Question. Please provide a project specific list for each of the 
Recreation Demonstration sites which will be accomplished under the 
program.
    Answer. At this time, the specifics of what will be accomplished 
under the program is still under review. The Park Service will provide 
this information to the Committee once final decisions are made.
    Up to 100 park sites will operate under this program.
    Question. What is the projected income from the sites designated?
    Answer. The fiscal year 1998 President's Budget estimated that NPS 
would collect about $48 million in additional revenue from parks 
participating in the demonstration program. Since the President's 
Budget was submitted, the Congress has amended the demonstration 
program by changing the base year for which the new fee revenue is 
calculated from 1995 to 1994, which would result in $12 million more in 
revenues. After the completion of the first year, NPS should be able to 
provide a more accurate estimate.
    Question. What are the priority uses for income through the fee 
demonstration program?
    Answer. The priorities of the program are the reduction of 
maintenance and resource backlogs as well as projects or activities 
that directly enhance the experience of the park visitor.
                          administrative costs
    A Department of the Interior OIG Report 96-I-1259 dated September 
1996, made five recommendations to address the issue of extended travel 
costs for Denver Service Center employees.
    Question. What is the status of implementation of those five 
recommendations?
    Answer. The OIG found that the policies and procedures of the 
Denver Service Center for extended travel of construction supervisors 
were in compliance with Federal and Department of the Interior 
requirements. However, the Inspector General found that the Denver 
Service Center did not adequately justify, or keep adequate records to 
justify operational decisions. To rectify this situation, NPS is 
reissuing its policy regarding extended travel costs. Following is more 
detail The five recommendations and the status of their implementation 
follows.
    Recommendation 1: Either ensure compliance with existing policy or 
revise the policy for extended travel to include consideration of other 
relevant and appropriate factors.
    Recently, all Denver Service Center employees received a copy of 
the reissued policy in the form of DSC Guideline 97-01.
    Recommendation 2: Develop procedures for estimating the cost of per 
diem versus the cost of employee relocation.
    DSC Guideline 97-01 contains procedures for estimating the cost of 
per diem versus the cost of employee relocation.
    Recommendation 3: Document the specific considerations that 
resulted in the determination to either pay per diem or relocate 
construction supervisors.
    DSC Guideline 97-01 requires Construction Quality Leaders to 
prepare a ``Record of Decision'' form to document the decision-making 
process of whether to execute a permanent change of station move or to 
place an employee on extended duty when the duration of an assignment 
is expected to exceed two years. Factors to be considered include cost, 
human, and business/project factors. No one factor is more important 
than another.
    Recommendation 4: Develop and implement procedures for authorizing 
per diem rates that consider actual expense levels at the specific 
locations of travel.
    DSC Guideline 97-01 requires that per diem rates are computed under 
the lodgings-plus per diem system with the total not to exceed the 
applicable maximum per diem rate for the location. DSC Guideline 97-01 
provides a flat rate for meals and incidental expenses that will be 
reviewed and reestablished every two years. Employees are responsible 
for obtaining lodging and for documenting their search, investigating a 
minimum of three equivalent lodging units. This procedure will 
determine the lodging flat rate for the location. Every six months the 
employee must certify that their costs have not been reduced. When an 
employee moves, their circumstances change, or an adjustment is 
requested, the same procedure will be followed to verify the applicable 
per diem rate.
    Recommendation 5: Require travelers either to note annual leave 
taken on the travel voucher or to certify ``no leave taken.'' on the 
voucher.
    DSC Guideline 97-01 requires the recommended certification.
    The agency recently went through a downsizing exercise and buyout 
program.
    Question. For the hearing record will you provide the Committee 
with a detailed analysis of the cost savings which have occurred as a 
result of the NPS reorganization?
    Answer. The NPS reorganization resulted in streamlined and 
reengineered administrative processes and downsized central offices. 
Since fiscal year 1993, NPS estimates that it has achieved annual 
operational savings of approximately $31.5 million through these 
efforts. These annual savings have been shifted over the last four 
years, through both the President's Budget requests and Congressional 
appropriations, to help support the additional park and program 
increases that have been appropriated to NPS.
    Question. How many central office positions were transferred to 
individual park units?
    Answer. Since fiscal year 1994 central office FTE have been reduced 
by over 20 percent while available park-based FTE allocations have 
increased by about 1,100, allowing more staff at the operational level 
while keeping overall NPS FTE levels stable. This includes 264 
employees transferring from central office positions to fill vacancies 
in park areas through Operation Opportunity--a program developed at the 
time of the implementation of our reorganization.
    Question. How many positions were vacated as a result of the buyout 
and early retirement incentive programs?
    Answer. In 1994 and 1995, 868 employees took advantage of the 
buyouts offered. The survival of pre-reorganization or pre-buyout 
positions cannot be tracked for two reasons. At NPS central offices, 
where 528 of the buyouts occurred, a job vacated by a buyout was 
allowed to be refilled as long as another central office position was 
not. Simultaneously, the reorganization caused changes to many position 
designations causing situations where certain positions were 
``vacated'', but not because of downsizing.
    Question. How much money will be expended in the buyout and early 
retirement incentive program for NPS?
    Answer. The cost NPS will incur to cover the Voluntary Separation 
Incentive Payments and the nine percent early-out charge for those 
taking the buyout offer will be approximately $22.1 million. This is a 
one-time only cost.
    Question. Is the composition of the NPS headquarters and regional 
offices as lean as it should be?
    Answer. The NPS continues to analyze reengineering possibilities 
and make additional reductions where possible.
    In total, the agency proposes to add 440 FTE's to the workforce.
    Question. Please stratify these positions for the record in terms 
of field, regional, and headquarters employees.
    Answer. The 440 FTE's would be distributed as follows:

Adding 440 FTE's to the workforce

Field.............................................................   376
Regional..........................................................    36
Headquarters......................................................    28
                        -----------------------------------------------------------------
                        ________________________________________________
      Total.......................................................   440

                          parkway divestiture
    A September 11, 1996, report from the agency acknowledges that 
Maryland and Virginia strongly oppose a ``plan in its present form'' to 
divest four parkways in the greater Washington area. Specific standards 
for continued management of the Parkways are contained in the present 
divestiture plan.
    Question. What proposed standards could be relaxed to make the 
divestiture more appealing to Virginia and Maryland?
    Answer. All of the standards contained in the proposed conditions 
of transfer are essential to ensure that management of these parkways 
meet the legislative intent that they serve as scenic gateways to the 
Nation's Capital. In our judgment, the States were not objecting to the 
standards as much as they were concerned about the maintenance costs, 
and the feeling that these roads should be a Federal responsibility as 
part of the park system of the Nation's Capital.
    Question. What portion of United States Park Police staffing is 
directly attributable to traffic enforcement on the major parkways in 
the suburban parkways of Washington DC?
    Answer. The U.S. Park Police assigned to the Glen Echo, Greenbelt, 
and the Anacostia Stations provide law enforcement services to the 
George Washington Memorial Parkway, Clara Barton Parkway, Baltimore-
Washington Parkway, and Suitland Parkway 24 hours a day. Each police 
cruiser beat requires 5.3 FTE to maintain 24 hour-per-day coverage.
    Three police cruiser beats are assigned to patrol the George 
Washington Memorial Parkway and the Clara Barton Parkway. In addition, 
five sergeants assigned to the Glen Echo Station, dedicated to 
supervising law enforcement activities on the parkways, assist in the 
patrols. Furthermore, in an effort to reduce excessive speeding that 
has led to serious traffic accidents along George Washington Memorial 
Parkway, the U.S. Park Police has redirected existing resources on an 
intermittent basis to provide increased coverage, especially during 
peak traffic hours. Two primary police cruiser beats are assigned to 
patrol the Baltimore-Washington Parkway. Due to extensive long-term 
highway construction, three additional officers are being used to 
supplement traffic enforcement efforts, eight hours per day. In 
addition, four sergeants assigned to the Greenbelt Station, dedicated 
to supervising law enforcement activities on the parkway, assist in the 
patrols.
    One cruiser beat is assigned to patrol the Suitland Parkway. Five 
sergeants from the Anacostia Station, who provide necessary supervision 
of officers assigned to the parkway as well as other areas within the 
confines of the station, assist in the patrols.
    Question. If divestiture occurs, what will happen to these 
positions?
    Answer. If divestiture of the four parkways were to occur, the U.S. 
Park Police would reassign the previously mentioned parkway positions 
to other areas within the force. With the ever-increasing drug and 
criminal problems within our Nation's Capital and the increased 
responsibilities of new memorials and other areas within the District 
of Columbia, these positions would be effectively utilized.
                         U.S. Geological Survey
                              program base
    According to the budget proposal, the U.S. Geological Survey (USGS) 
will be required to absorb fiscal year 1998 uncontrollable 
administrative increases, which are estimated at a minimum of 
$11,895,000, from within their current program base. No other Interior 
Department agency funded through this bill has been required to meet 
additional costs of this same magnitude from within its current program 
base.
    Question. How was the determination made to propose funding 
uncontrollable increases for some agencies, such as BLM, NPS and the 
Bureau of Indian Affairs, but not USGS?
    Answer. In an optimum budget with unlimited resources, each of the 
bureaus would request increases for uncontrollable costs. The 
Department began the formulation process for fiscal year 1998 with that 
goal in mind, but the realities of balancing the budget forced 
difficult choices about priorities for program increases and overall 
funding levels for individual bureaus. As a result, some bureaus were 
able to cover uncontrollable costs with funding increases and others 
were not. The USGS presentation of uncontrollable costs is different 
from other bureaus because USGS elected to show their uncontrollable 
costs as non-adds rather than show the specific program reductions. It 
must be noted that regardless of the display methodology used, these 
are real costs that must be paid by all agencies of the Department in 
1998.
    In addition to absorbing uncontrollable increases, current program 
levels are proposed to be reduced further in fiscal year 1998 in order 
to offset funding for new program proposals, such as the Kalamazoo 
Project (+$9 million). A significant increase for the Global Seismic 
Network (GSN), a relatively new program, is also offset from the 
current program base; the fiscal year 1997 appropriation for the GSN is 
$800,000, with a proposed increase of $3 million in fiscal year 1998.
    Question. Why isn't there greater emphasis on enhancing traditional 
USGS programs? Are these programs now funded at sufficient levels to 
accomplish their purposes? Or is there a need to redefine the programs 
that comprise the Survey's core that is represented by the budget 
request?
    Answer. Research conducted by USGS is not static; programs 
continually adapt and change to respond to emergency needs brought on 
by natural disasters, changing priorities of its clientele, and 
increased basic operating costs. Shrinking budget levels and the need 
to balance the Federal budget have created an environment in which 
managers and agency directors are forced to do more (and, in some 
cases, less) with fewer resources. They attempt to find programs and 
functions that can be eliminated or carried out in a new manner, 
thereby allowing for the redirection of funds to higher priority 
programs. In many instances, the proposed decreases in the fiscal year 
1998 budget reflect estimated savings achieved under efforts to further 
Phase II of the National Performance Review goals of Reinventing 
Government (REGO II). As a result, USGS carries out program reviews and 
strategic planning to ensure an appropriate level of funding, so that 
its programs continue to provide credible and impartial information 
relevant to society's needs. There is no need to redefine the programs 
that comprise USGS' core represented by the budget request, because 
each budget submission of USGS portrays the changing nature of USGS 
science programs.
    Buyouts and reductions-in-force have reduced the ranks of the USGS 
by over 1,000 people since 1994. In July of 1995, USGS indicated to the 
Subcommittee its concern that the division's ability to carry out its 
programmatic responsibility had been severely eroded by absorption of 
salary and other fixed costs.
    Question. Inasmuch as the program base is proposed for further 
reductions through the continued absorption of fixed costs and new 
programs, please comment on the current ability of USGS to fulfill its 
mandate.
    Answer. In the past five years USGS has absorbed over $43 million 
in uncontrollable costs. The USGS has sought to deal with the effects 
of this absorption, as other bureaus have--by streamlining processes, 
by working more efficiently, and by setting priorities. In recent 
years, USGS has also had to conduct a Reduction-in-Force, pursue buyout 
relief, defer recruitment, defer replacement of equipment, and reduce 
travel and training in order to sustain operations at levels sufficient 
to carry out programmatic responsibilities. In fiscal year 1998 another 
$12 million is proposed to be absorbed, with attendant impacts on 
program quality, timeliness, and output. The following are examples of 
the types of impacts to programs that can be expected from continued 
absorption of uncontrollables.
  --Decline in timeliness and geographic extent of data collection and 
        deferred modernization and upgrade of monitoring networks 
        impacting availability of information for flood warning, water 
        quality assessments, and geologic hazards assessments of 
        earthquakes, volcanoes, and landslides.
  --Reduction in the amount of geospatial data and satellite imagery 
        that can be acquired, integrated, and made available to users 
        each year to help resolve environmental and land and resource 
        management issues facing the Nation.
  --Reduction in the amount of effort to implement national digital 
        data bases further delaying implementation of accessible, 
        standardized frameworks of data.
  --Decline in the number of research and development investigations, 
        reducing the USGS ability to address emerging national problems 
        and future needs of local, State, and other Federal Government 
        agencies.
  --Reduction in work with partner agencies and organizations in 
        developing scientific information and management tools to 
        enable wise use of resources.
                        national mapping program
    An $850,000 reduction in research for the National Mapping Program 
is proposed for the purpose of advancing REGO II goals. Funds will be 
redirected to higher priority programs in other divisions. The 
reduction modifies the mapping program's operational management 
strategy so that the original plan for relational data implementation 
will be postponed.
    Question. How does the postponement of this work advance REGO II?
    Answer. The proposed $850,000 decrease represents an acceleration 
of anticipated REGO II savings which were originally scheduled for 
fiscal year 1999 and 2000. The decrease will delay implementation of a 
standard relational database management system for program operations. 
Savings from REGO II are expected to result from efficiencies gained 
through public access of cartographic data and products via the 
Internet. New Internet access capabilities have allowed the public to 
investigate USGS data holdings, determine the availability and 
characteristics of the data being sought, and arrange for delivery of 
the data, usually instantaneously, without the need for USGS personnel 
to assist in the process. This new mechanism saves the need to produce 
search materials and operate search mechanisms, saves salary and 
related costs for personnel no longer needed to operate the systems, 
and saves costly computer processing times, materials, and mailing 
expanses to retrieve, replicate, and transmit data to customers.
    $1.2 million of the National Mapping Program's budget is proposed 
to be refocused for the Urban Dynamics project, a three year program 
scheduled to begin in fiscal year 1998.
    Question. What programs are being reduced or have been completed in 
order to begin this initiative?
    Answer. The redirection of $1.2 million to increase work on urban 
dynamics will result in curtailment of research projects that support 
the data programs of the National Mapping Division. These programs 
focus on improving existing production methods, supporting the 
development of new spatial data products, and improving the methods of 
spatial data acquisition and integration.
    The other major area of research activity within the National 
Mapping Program, data applications development, has no flexibility for 
adjustment, and is a higher priority activity because of its direct 
support of customer requirements for methods to use geographic data in 
addressing issues of national importance related to the environment, 
resource management, and socio-economic topics. Production system 
maintenance and computer support activities also are not adjustable 
because the National Mapping Program hardware and software systems are 
dependent upon them and because of their direct linkage into the 
private sector, which provides most of the services in these areas.
    Question. How was it determined which four metropolitan areas would 
be the focus of the program?
    Answer. The four cities were selected from the American Farmland 
Trust (NFT) list of high priority cities where urbanization threatens 
agricultural land. Further refinement of the list was done by examining 
cities where there was concern for impacts on ecological diversity in 
very different ecological regions. Specific city selections had 
additional regional criteria as well. Philadelphia and New York were 
then identified as major urban areas that would continue the work 
started in the Washington/Baltimore area. Chicago was identified as a 
critical mid-western city that met the NFT and ecological criteria. 
Portland, Oregon was selected because the effect of different land use 
planning models being used in Washington and Oregon can be compared in 
subsequent research. All cities were chosen to meet multiple criteria 
important for geographic research.
    The National Mapping Program has complied with the Congressional 
directive to increase its use of contractor services for data 
collection and integration.
    Question. Please comment on the results of this action to date.
    Answer. The USGS has increased the level of contracting for 
services in map and digital production by a third over the levels of 
fiscal year 1996. This represents nearly a doubling of the fiscal year 
1995 level. Contracting has extended the capacity for several data 
categories of the National Mapping Program.
    Developing successful contracting partnerships has required a 
significant investment of USGS resources. Some delivery schedules have 
slipped as new contractors adapt to USGS product and quality 
requirements. The USGS has had to curtail spending on other efforts to 
redirect funds to production contracting, thus reducing programmatic 
flexibility. The National Mapping Program will continue to pursue a 
policy of contracting with the private sector throughout the program 
and in all areas where it is in the best interests of the Government to 
do so.
    Last year, Congress included funds to assist USGS in preparing an 
Electronic Atlas of the United States.
    Question. Please report on the progress of this project.
    Answer. Significant progress has been made on the electronic 
National Atlas of the United States in fiscal year 1997. 
Accomplishments during fiscal year 1997 included initial development of 
a suite of National Atlas products, development of a prototype, 
conducting market research activities, developing atlas products for 
the World Wide Web (WWW), and seeking private sector partners.
    The USGS has completed the revision of basic digital map layers 
such as boundaries, highways, and streams for the entire country. These 
data have been compiled according to exacting standards so that they 
will serve as an accurate and reliable framework for the integration of 
thematic data sets, such as geology, soils, major groundwater 
reservoirs, and demographic information. Work has begun on integrating 
thematic data from the U.S. Bureau of the Census and the National 
Center for Health Statistics.
    The USGS has also completed an electronic prototype that 
demonstrates the vast potential of the National Atlas. Prototype 
development provided an opportunity to investigate the integration of 
multimedia software with geographic information systems capabilities as 
well as an opportunity to experiment with differing graphical user 
interfaces. The National Atlas prototype has been demonstrated to 
prospective partners in Government and the private sector. It will be 
used to assess consumer attitudes towards the National Atlas in focus 
groups scheduled for later this summer. The USGS has also initiated 
work on several map prototypes that will be available for customer 
assessment during the first quarter of fiscal year 1998.
    The USGS has begun other market research activities that will help 
to determine the initial content and functional capabilities of the 
National Atlas and support the production of a comprehensive and 
cohesive marketing plan for all National Atlas products. These 
activities include a comparative assessment of atlas-like products 
currently marketed, point-of-sales tracking for these products, focus 
groups, and customer surveys to aid in focusing product development.
    We are currently developing National Atlas products for the WWW. 
These include information products such as fact sheets, promotional 
materials, and project status reports. Also under development is a 
basic geographic information system capability that allows WWW users to 
select, symbolize, view, and query the data collected by this project. 
The WWW will be used to deliver National Atlas data and provide access 
to other sources for local, more detailed data and information. The WWW 
site for the National Atlas will be fully operational during the third 
quarter of fiscal year 1997.
    The USGS has sought the participation of private sector partners to 
ensure the success of the National Atlas. The USGS has held discussions 
with companies involved in software development, market research, 
publishing, and product distribution. At present, USGS has formed a 
partnership with Environmental Systems Research Institute of Redlands, 
CA, to develop the National Atlas WWW prototype. This cooperative 
research and development agreement will expand to include development 
activities that exploit emerging technologies for managing large 
digital cartographic data sets and for serving map products via the 
WWW.
    Question. How much is included in the fiscal year 1998 base to 
continue work on this project?
    Answer. There is $2.0 million included in the fiscal year 1998 base 
to continue work on this project.
                         global seismic network
    The GSN is proposed to receive an increase of $3 million to its 
current base of $800,000 in order to begin the operation and 
maintenance phase of the program. The GSN is part of an international 
monitoring system being developed to verify compliance with the 
recently signed Comprehensive Test Ban Treaty.
    Question. Specifically what will the proposed increase be applied 
to? What enhancements, if any, are anticipated to the GSN and how will 
long-term operation and maintenance costs be affected?
    Answer. The proposed increase of $3.0 million for fiscal year 1998 
will be spent in the following manner: 1) $1.7 million is for network 
deployment and support. This involves the preparation and testing of 
new equipment at the Albuquerque Seismological Laboratory remote 
diagnosis of equipment problems, and repair of equipment malfunctions; 
2) $200 thousand is for routine maintenance visits to USGS-operated GSN 
sites within the U.S. and its territories; and 3) $1.1 million is for 
data management and quality control. This involves shipment of data, 
extensive quality control, data archival, and reformatting of raw data 
for dissemination to users.
    The GSN currently consists of 107 stations of which USGS maintains 
77. When fully implemented, the GSN will have approximately 150 
stations for which USGS will have operational responsibility for 106. 
Funds currently spent on testing and deployment of new equipment will 
be shifted to network maintenance and support as the network is 
completed.
    Question. What agencies will be responsible for interpreting the 
data collected by USGS relating to implementation of the nuclear test 
ban treaty? Will USGS be reimbursed for their costs by these customers? 
Can the network eventually become self-sustaining?
    Answer. The International Monitoring System (IMS) defined by the 
test ban treaty will consist of 50 primary seismic stations, 120 
auxiliary seismic stations, and other technical sensors. The auxiliary 
stations are to be used to clarify the nature of events detected and 
located by the primary network. The GSN contains 69 of the auxiliary 
seismic stations. The Air Force Technical Applications Center (AFTAC) 
is responsible for the interpretation of all IMS data. Additionally, 
GSN data are used in treaty related research programs supported by the 
Department of Defense (DOD) and the Department of Energy (DOE). Because 
of initial capital investment in the GSN program by DOD and DOE, USGS 
does not expect to be reimbursed by these agencies for their use of GSN 
data.
    The GSN is also supported in part by each of the host countries. 
They provide the local infrastructure required to keep the stations 
running. Nevertheless, because of the technical complexity of GSN 
stations, a central maintenance and support facility is also required 
for operation of the network. The USGS does not expect the network to 
become self-sustaining.
    The Office of Science and Technology Policy (OSTP) reviewed the GSN 
funding issue in November 1995. As a result of this review, OSTP 
recommended that funding for the GSN should not be placed in DOD, but 
rather within the budgets of USGS and the National Science Foundation 
(NSF).
    Question. How much and in what ways are other partners in the 
International Monitoring System contributing to the project? Why will 
USGS bear the responsibility for funding the operation of this network?
    Answer. The NSF has provided substantial funding to USGS to install 
GSN stations. The NSF will continue to provide funds for the operation 
of those GSN stations not installed by USGS. It is appropriate for USGS 
and NSF to bear the responsibility for operating this network because 
its primary use is in the routine reporting and characterization of 
earthquakes and in research. The USGS' National Earthquake Information 
Center analyzes GSN data on a daily basis to determine the location, 
depth, magnitude, and ``source mechanism'' of large earthquakes 
worldwide. These results are usually obtained within an hour or less of 
the occurrence of the event. These results are used in emergency 
response and to determine if an earthquake is likely to have generated 
a tsunami which may affect coastal regions of the Pacific Northwest, 
Alaska, and Hawaii.
    Data from GSN also are used in research for scientific exploration 
of the Earth's interior and for studies of the earthquake sources. For 
example, the recent discovery of the differential rotation rate between 
the Earth's inner and outer cores was based, in part, on data from GSN. 
This discovery is a major advance in understanding the source and 
nature of the Earth's magnetic field. Data on the source mechanisms of 
earthquakes worldwide, particularly those occurring in the middle of 
continents, can be applied to the understanding of earthquake hazards 
in the United States.
    The GSN is a multiple-use activity. Data from GSN are used for 
disaster warning and response, research on earthquake and the interior 
of the Earth, and in arms control research and monitoring. The primary 
users of the data are USGS and the academic community and thus it is 
appropriate that USGS and NSF assume responsibility for the operation 
of GSN.
    Question. To what extent have defense and intelligence-related 
functions traditionally been performed by USGS? Does USGS anticipate a 
greater program emphasis in these directions in the future?
    Answer. Since World War II, USGS has been involved in varying 
degrees in defense and intelligence-related functions. Most of this 
involvement has been in the collection and interpretation of geological 
and geophysical data from foreign sites. Generally it has been on a 
reimbursable basis but in some cases cost sharing has been applied 
where mutual program benefits are identified. Most of the work is done 
in-house, but USGS personnel have been assigned to other agencies for 
extended periods for specific purposes. During the past decade, USGS 
has made increasing use of data collected for defense and intelligence 
purposes in the revision of topographic maps, geologic mapping, and in 
assessments of natural hazards, mineral resources, and environmental 
changes.
    Although USGS does not plan greater program emphasis on traditional 
defense and intelligence roles, it expects and welcomes an expansion of 
data sharing with these communities. In some cases, such as in the 
collection of satellite imagery data, the defense and intelligence 
communities carry the major costs of data acquisition. In other cases 
where USGS interests prevail, costs of data collection are borne by 
USGS.
             national cooperative geologic mapping program
    In order to fund higher priority programs, a program reduction of 
$1,726,000 to the National Cooperative Geologic Mapping program is 
proposed. It would be disbursed among the three program components as 
follows: -$1,346,000 to the FEDMAP program; -$345,000 to the STATEMAP 
program; and -$35,000 to the EDMAP program.
    The budget request could not provide information on the effects of 
decreases to the STATEMAP and EDMAP programs.
    Question. Why was the decision made to reduce these programs when 
the impact of the reductions cannot be assessed?
    Answer. The general impacts can be assessed; however because 
STATEMAP and EDMAP activities are based on annual proposals, the 
specifics cannot be determined until after the individual State mapping 
advisory panels meet this summer and the national awards panels meet 
during the late Fall of 1997. The STATEMAP awards committee consists of 
five representatives from State geological surveys, three USGS 
scientists, and the coordinator of the program's external funds. The 
EDMAP awards committee consists of three University professors, two 
State Geologists, and the coordinator of the program's external funds. 
The general impact of the decrease is the equivalent of funding four 
fewer cooperative projects with State surveys (STATEMAP) and four fewer 
cooperative projects with universities (EDMAP).
    The FEDMAP program decrease would delay or terminate projects 
engaged in mapping earthquake faults, urban geology and risks 
associated with geologic hazards, along with a number of others. 
Dissemination of geologic map information would also be curtailed.
    Question. What factors led to the decision to reduce this 
particular program? Why don't the activities accomplished with these 
funds merit a priority?
    Answer. Difficult decisions were required in order to meet target 
allowances associated with formulating the fiscal year 1998 budget. In 
addition, within the geologic programs of USGS, decisions are made 
within the context of the recent Reduction-in-Force which was 
undertaken to correct a decade long problem of excessive personnel 
costs, the absence of operating funding, and the inability to carry out 
a financially balanced program. Based on these experiences, the 
decision was made to achieve the allowed funding level for fiscal year 
1998 through cutbacks in a limited number of programs. This approach 
enables preservation of the financial viability of remaining programs 
as opposed to spreading these cutbacks across all programs and thereby 
eroding the financial balance that was achieved through the Reduction-
in-Force.
    This proposed reduction does not suggest that USGS considers 
geologic mapping to be a low-priority activity. In addition to 
construction of a digital National Geologic Map Data Base, the National 
Cooperative Geologic Mapping Program is conducting geologic mapping to 
address pressing issues related to natural hazards, water resources and 
quality, land-use planning, urban geology, and non-renewable resources. 
The program's activities are focused mainly on urban corridors in 
Washington-Oregon, California-Nevada, New Mexico, Colorado, Nebraska-
Iowa, Kansas-Missouri, Georgia, South Carolina, Virginia-Maryland, 
Vermont, Florida, and Alaska. Priorities for FEDMAP projects are set in 
partnership with other Federal, State, and local agencies and industry. 
During the past year, the program has sponsored regional workshops to 
assess geologic mapping needs in the East, upper Mid-West, and West.
    In addition, the program funds cooperative geologic mapping 
projects with State surveys and universities in more than 40 States on 
an annual basis. Significant funding would remain in the National 
Cooperative Geologic Mapping Program to support the continuation of a 
number of important projects, although the program be downsized to 
match the proposed reduced funding level.
                          continental surveys
    The continental surveys program is slotted for elimination and its 
funding of $2,848,000 proposed to be used for higher priority programs. 
Results of the interdisciplinary research accomplished by this program 
are used by other USGS programs to help assess alterations of the 
earth's surface, earthquake hazards, volcano hazards, and petroleum 
energy resources. It is proposed in the budget request that, when 
feasible, some activities will be integrated into other USGS programs.
    Question. Is there currently a determination of what activities 
will be continued in other programs? If so, please explain.
    Answer. Program and financial plans for fiscal year 1998 are being 
prepared this summer. Through this planning process opportunities to 
absorb staff and functions of Continental Surveys in other geologic 
programs will be thoroughly explored.
    The budget proposal does not specifically address the merits or 
lack of them that resulted in the proposed elimination of the 
continental surveys program.
    Question. Please provide the Committee with the rationale for this 
action.
    Answer. One aspect of the REGO II exercise conducted two years ago 
required the identification of program areas for termination. Because 
the Continental Surveys Program was conducting research and 
investigations supportive of other USGS programs it was selected for 
elimination on the grounds that these other programs might be able to 
absorb some of these activities.
                           kalamazoo project
    The Kalamazoo project proposes to use $9 million in new budget 
authority within the National Water Quality Assessment program to 
implement the President's announcement of an initiative last August to 
improve a community's knowledge about the quality of its water supplies 
and increase its ability to protect this resource. Offsetting 
reductions were taken in other USGS projects in order to absorb the 
proposed increase.
    Funds for this project were not requested by USGS or the 
Department, but were included by OMB in the final budget proposal 
submitted to Congress.
    Question. Please explain.
    Answer. The Kalamazoo Initiative was introduced by the President in 
August 1996, too late to be included in the USGS budget submission to 
the Department or OMB. Although this initiative was a Presidential 
initiative which did not originate at USGS, the USGS strategic plan 
states that USGS will increase emphasis on ``studies involving 
population centers, quality, and accessibility of resources''. Further, 
the strategic plan identifies Environmental Effects on Human Health as 
an integral business activity of USGS. The President's Initiative is 
consistent with these provisions of the plan.
    Question. How do you justify decreasing already reduced programs 
further in order to accommodate a new start?
    Answer. The Administration places a high priority on the public's 
``right to know'' what is in its drinking water, which is addressed 
directly by this initiative. But in order to fund this work within a 
shrinking Federal budget, it is necessary to provide partially 
offsetting decreases from other programs.
    As presented on page 164 of the budget proposal, there are five 
distinct components of this initiative.
    Question. Please explain how much of the $9 million will be 
allocated for each component.
    Answer. Allocation of funding among the five components of the 
Kalamazoo Initiative will change over the course of the planned four-
year effort. Emphasis the first year will be on assembling existing 
information and identifying information gaps. Additionally, efforts in 
the first year will build the linkages necessary for easy public access 
to the data and information. In subsequent years with data gaps 
identified, much more of the funding will focus on collecting 
additional samples, expanding the available data on source water 
quality. For data collection activities to be effective and efficient 
in the out-years, a thorough analysis of existing information is 
planned the first year. Resulting funding allocations for fiscal year 
1998 are:

Funding allocations for fiscal year 1998

                                                                Millions
Analyze existing information, design data base, build public 
    access........................................................  $5.6
Develop fact sheets summarizing current knowledge.................   1.0
Augment some existing NAWQA sampling in urban areas...............   1.0
Identify and sample new streams and aquifers......................    .5
Enhance existing research capabilities for contaminants...........    .9
                        -----------------------------------------------------------------
                        ________________________________________________
      Total...................................................       9.0

    A major emphasis of the program is dissemination of information to 
the general public through published fact sheets, as well as a Web 
Site, in order to meet the American public's right to know.
    Question. Is water quality assessment information currently 
reaching experts at the Federal, State, and local levels where 
productive work can be accomplished to effect change?
    Answer. In addition to describing the status and trends in the 
quality of the Nation's waters, and understanding the natural and human 
factors affecting water-quality conditions; the third goal of the 
National Water Quality Assessment Program (NAWQA) is providing 
information to Federal, State, and local water-resource managers. There 
are liaison committees for each of the 36 study units begun in either 
1991 or 1994. These liaison committees include more than 800 
representatives of Federal, State, local agencies, and non-governmental 
organizations. At the national level there is also a Federal and non-
Federal Advisory Council with more than 50 members. These committees 
meet annually. An example of recent impact can be found in Washington 
and New Jersey. Using USGS information on the vulnerability of shallow 
aquifers to pesticide contamination, the regulatory agencies in these 
two States instituted waivers (from Safe Drinking Water Act 
requirements) on source water sampling where the pesticide 
contamination risk was low. Each State saves about $5 million annually. 
The Kalamazoo Initiative will provide for expanding communication with 
more managers in geographic locations beyond NAWQA study units.
    This project is intended to be a collaborative effort with the EPA 
and National Oceanic and Atmospheric Administration (NOAA).
    Question. How much is each of the other agencies proposed to 
contribute? What will their roles be? What are the anticipated costs 
for this program in future years for USGS and its Federal partners?
    Answer. Each agency would have a different responsibility under the 
Initiative. The USGS ($9.0 million) will provide information on the 
character of drinking water sources and how the quality varies 
temporally and geographically. The EPA ($35.0 million) will work with 
cities serving information to the public on water conditions in the 
urban area, including toxic release information, types of water 
treatment for municipal supply, and impacts of the water delivery 
system infrastructure which partly determines the quality of water 
consumed. The NOAA ($4.0 million) will evaluate the impact of cities on 
coastal water resources, and provide information to the public on beach 
and shell fish bed closures. In summary, USGS would work with the 
source water, EPA would focus on treated water consumed by the public, 
and NOAA would address the impacts of cities on coastal areas. Outyear 
estimates for each agency are:

                                        OUTYEAR ESTIMATES FOR EACH AGENCY                                       
                                            [In millions of dollars]                                            
----------------------------------------------------------------------------------------------------------------
                                                                           Fiscal year--                        
                                                 ---------------------------------------------------------------
                                                       1998            1999            2000            2001     
----------------------------------------------------------------------------------------------------------------
USGS............................................               9              12              12              12
EPA.............................................              35              35              35              35
NOAA............................................               4               3               2               2
                                                 ---------------------------------------------------------------
      Federal total.............................              48              50              49              49
----------------------------------------------------------------------------------------------------------------

    Question. What steps have been taken to assure that this proposal 
will not duplicate work already being done at the State and local 
levels, or by other Federal agencies? Is there a consistent set of data 
standards to which State and local agencies adhere currently?
    Answer. At the Federal level, this proposal is coordinated with 
major water-quality activities of EPA. The USGS effort will build on 
and expand efforts underway at EPA. Through its network of 
communication with over 1,100 State and local cooperators across the 
country, USGS will ensure that this initiative does not duplicate 
existing efforts. Further, across the country, consistent data 
standards have not been adopted at the State and local level. That was 
one of the reasons for initiating the NAWQA Program, and it remains the 
reason why the Program's results are of high interest to national 
organizations. Because this initiative will not duplicate existing 
efforts locally, work under the Initiative will have varying emphasis; 
however, no matter the emphasis, the approach and methods will be 
nationally consistent. In some locations the emphasis may be on 
disinfection by product precursors, and in other areas the emphasis 
could be on arsenic; consistent national methods will be used in either 
case.
                           acid rain program
    The acid rain program is proposed to be discontinued as an isolated 
monitoring program in fiscal year 1998. Its current funding level is 
$1,657,000. Some of the deposition monitoring activities of this 
program will be incorporated into the National Water Quality Assessment 
program.
    Question. Which of the activities in the acid rain program will be 
discontinued altogether?
    Answer. The USGS remains committed to its role as the lead Federal 
agency for the monitoring of atmospheric deposition. There are no 
immediate plans to change funding support for acid rain monitoring or 
to alter activities at any of the 71 USGS monitoring stations currently 
funded by the Acid Rain Program. Any changes in program composition 
based on this consolidation of programs will affect core NAWQA 
activities, rather than acid rain activities. The USGS will continue 
working closely with many other Federal, State, and local partners in 
the National Atmospheric Deposition Program (NADP) to ensure that the 
network continues to produce high-quality, relevant, and timely 
information needed for policy decisions on many critical environmental 
issues, and that any proposed modifications to USGS monitoring network 
arising from effects of inflation or future budget constraints will be 
fully coordinated with the multi-agency NADP.
    Question. If NAWQA is capable of assuming a number of this 
program's activities without additional funding, why hasn't this 
consolidation been proposed before now?
    Answer. There are three reasons why the change occurred in fiscal 
year 1998: 1) funding for the Acid Rain Program is slated for 
elimination in fiscal year 1998 as part of REGO II; 2) in fiscal year 
1998, the Acid Rain Program would have been eliminated as a separate 
line item as part of a budget restructuring process; and 3) the 
importance of atmospheric contributions to the quality of ground water 
and surface water being studied in the NAWQA program has become 
increasingly important, so that only recently have the benefits of 
incorporating the two programs become obvious.
                federal-state cooperative water program
    A decrease of $1,214,000 is proposed for the Federal-State 
Cooperative Water Program. In terms of data collection, all activities 
at 120 streamflow gaging stations would cease. Additionally, the budget 
notes that important water supply and contamination issues would not 
begin as a result of this decrease.
    Question. Are any of the stations proposed for closure among those 
that were damaged in recent floods? If so, were replacement funds 
included as part of the current supplemental request?
    Answer. The stations which would be closed as a result of the 
proposed reduction in the Cooperative Program for fiscal year 1998 have 
not yet been identified. Since the stations supported by this program 
are funded by a combination of Federal appropriations and State 
matching funds, USGS will need to consult with its State and local 
cooperators to determine which stations should be closed. This 
consultation is necessary to ensure that the hydrologic information 
needs of State and local government agencies who participate in the 
Cooperative Program will continue to be met, to the fullest extent 
possible, despite the station closures.
    Question. Why doesn't the work produced through this program merit 
sufficient priority to receive continued funding?
    Answer. The funding proposal is not a judgment on the merits of 
this program. In these times when the Federal budget is under tight 
fiscal constraint, the reduction is proposed as one of several 
decreases to partially offset the increase for the Kalamazoo Initiative 
(to provide the public with information on the quality of their 
drinking water sources). Within the current fiscal climate, difficult 
decisions had to be made to accommodate new work, often at the expense 
of other programs.
                  water resources research institutes
    A proposed budget reduction of $2,803,000 could result in the 
closure of institutes that cannot find a replacement for Federal funds. 
About one-third of the institutes now receive all or most of their 
funding from this appropriation and its matching funds. This reduction 
would also result in a loss of some data collections activities and 
interpretive studies dealing with water management issues.
    Question. Please explain the reasons used to determine that this 
program lacks the priority of others.
    Answer. The Institutes Program, though very important, supports 
USGS core mission less than other funded programs. By design, the 
programs of the Institutes are to be focused on priority needs of the 
States and are not required to contribute to national data bases or 
resolve multi-State water issues. Funding from the States and from 
Federal agencies such as the NSF, EPA, and Department of Agriculture, 
along with specific project-related funding from USGS, will continue to 
support water science in the States.
    Since there are alternatives for funding water science which 
addresses issues of specific concern to the States, and since there is 
no alternative for funding the types of work that are done in-house at 
USGS, the Administration's priorities lie in ensuring continued support 
for long-term research and monitoring activities that take a national 
perspective. These activities cannot be undertaken by the States or by 
academia because there is no national infrastructure to support such 
work at the State or local level. In addition, there is no other single 
Federal agency which has the interdisciplinary scientific expertise to 
carry out an integrated national program of water resources research 
and monitoring.
                      biological research division
    Question. Please comment on the consolidation of the Biological 
Resource Division's functions into the USGS. What problems, if any, 
have been encountered?
    Answer. The consolidation of the functions of the former National 
Biological Service (NBS) into USGS as BRD is largely complete. This is 
the second fiscal year that USGS and the former NBS budget 
presentations are combined in budget to Congress. Administrative and 
personnel functions are being merged in line with the schedule 
presented in the USGS/NBS Steering Committee Merger report that was 
completed in late 1996. For instance, the Washington area BRD staff 
moved into the USGS National Center in Reston in September 1996. 
Science programs are being integrated through both day-to-day research 
and in planning for future inter-divisional science initiatives. These 
efforts are applying the strengths of traditional USGS culture with 
those of NBS to develop improved, integrated, and efficient Bureauwide 
procedures.
    Question. Are the Interior agencies that are served by the BRD 
satisfied with the support they receive under this consolidated 
division?
    Answer. Given the diversity and magnitude of the resources for 
which the Department is responsible, the needs of its resource 
management bureaus related to scientific information will most likely 
always exceed the available resources of USGS. Department bureaus are 
generally satisfied with the support they have received from BRD and 
see the future stability of the organization as improving the ability 
of BRD to address their science needs effectively. In particular, BRD 
has worked hard to maintain and foster its working relations with the 
resource management bureaus. Improvements in identifying Bureau 
Information Needs (BIN) are being pursued to ensure that the critical 
needs of the bureaus are communicated to BRD and that the science 
conducted by BRD is responsive to these needs. While BRD is taking 
actions to improve this process, its initial success can be judged by 
the positive actions that have been stimulated in these bureaus.
    The FWS has established and filled a senior management position to 
coordinate the identification of information needs within the Service. 
The BLM has formalized its strategic science planning process to 
systematically provide its science information needs directly into the 
BRD BIN process in a timely manner. Various avenues are used to report 
back to the bureaus on BRD responses to information needs. For example, 
BLM recently received a major report on the status of their information 
needs and on projects and activities underway to address these needs. 
The BRD Research Centers are holding workshops and meetings with 
counterparts at the regional and local level to discuss progress in 
addressing information needs. These actions have enhanced communication 
between BRD and bureaus at all levels.
    Question. Has the integration of BRD into the Survey's activities 
enhanced the two divisions' abilities for interdisciplinary research, 
or is the nature of their work such that they perform as two distinct 
entities?
    Answer. The BRD integration into USGS has enhanced the opportunity 
for interdivisional collaborative research. The BRD is a full equal 
partner on bureauwide councils and task forces. Interdivisional 
planning and discussions are a key feature for identifying and 
developing budget initiatives for future years. Interdivisional 
meetings of program managers are regularly held to foster such 
discussions and collaborations of ongoing activities. Points of contact 
for specific topics (e.g., environmental contaminants) are identified 
at headquarters and regional levels to facilitate interactions between 
scientists at the working level. Collaborations are beginning where 
expertise and ongoing activities in each Division complement each 
other. For example, BRD was incorporated into the planning and 
implementation of the Abandoned Mine Lands Initiative.
    A $6,000,000 increase is requested for biological research and 
monitoring activities.
    Question. Please provide the committee with a list of these 
programs with the currently appropriated levels of funding and 
prioritize the program increase request.
    Answer. The biological research and monitoring activities 
constituting the requested $6 million are listed below. The science 
addressed by the requested increases are the top information needs 
identified by bureaus submitted in 1995 and 1996.

Biological research and monitoring activities

                                                             In millions

Science support for management of Federal Lands................... +$3.0
                        -----------------------------------------------------------------
                        ________________________________________________
Invasive species (base: $3.3):
    Weeds in the West.............................................  +1.2
    Exotics in the East...........................................  +0.7
    Integrated monitoring (base: $0)..............................  +0.8
    Air quality impacts on biological resources (base: $0)........  +0.3
                        -----------------------------------------------------------------
                        ________________________________________________
Endocrine disrupters (base: $0.6).................................  +1.0
                        -----------------------------------------------------------------
                        ________________________________________________
Restoration of degraded lands and resources (base: $0)............  +1.0
    Coastal habitats..............................................  +0.5
    Pacific salmon................................................  +0.5
                        -----------------------------------------------------------------
                        ________________________________________________
Restoration of Great Lakes fisheries and habitats (base: $5.0)....  +1.0

                      Minerals Management Service
                          director's statement
    The Minerals Management Service Director issued a statement to the 
House of Representatives regarding the fiscal year 1998 program. The 
Subcommittee has the following questions relative to this statement.
    The agency states that it is accomplishing streamlining goals by 
reducing management layers.
    Question. What are the specific statistics regarding this 
accomplishment? How many positions at mid-level grades have been 
reduced over the past three years? What savings have been derived from 
this effort? How have these savings been reallocated to other MMS 
programs?
    Answer. Under the recently implemented MMS 2000 reorganization all 
organizations reflect fewer reporting layers. The organization has 
flattened by eliminating layers of supervision and having Divisions and 
Regions reporting directly to the Associate Director. In that vein the 
following actions have been implemented:
  --Five Deputy Associate Director (DAD) positions have been abolished. 
        Pre-MMS 2000 there were seven DADs whereas post-MMS 2000 there 
        are only two.
      For both the Royalty Management and Offshore programs two DADs 
        have been combined into one; General Administration (2) and PMI 
        (1) have eliminated their DADs.
  --A number of Divisions have been combined and or abolished as 
        follows:
      In General Administration, the Budget and Finance Divisions have 
        been combined into one division; the EEO office has had 
        training functions combined into it from Personnel, creating 
        the Equal Employment and Development Opportunity Division; and 
        the Management Services and Security Division has been 
        eliminated.
      In Offshore, the Engineering and Technology, and Inspection 
        Compliance and Training Divisions have been combined and 
        retitled to Engineering and Operations Division.
      In Royalty, the Data Management Division, and Reports and 
        Financial Division have been combined as the Accounting and 
        Reports Division; and the Valuation and Standards Division and 
        all solid minerals functions from the Data Management Division 
        have been combined as the Royalty Valuation Division.
    From October 1994 to the end of May 1997 MMS has been striving to 
reduce the number of GS 14s, GS 15s, and SES positions. As a result of 
that effort, to date MMS has 40 fewer GS 14s, 14 fewer GS 15s, and nine 
fewer SESs. A large majority of these vacancies were created by 
individuals accepting the voluntary separation incentive program 
(buyouts). The savings attributable to buyouts was partially offset by 
the buyout payment itself and the cost of an individual's lump sum 
annual leave. The funds not used to support the buyout program have 
been rolled back into their respective programs. Legislative and 
regulatory authorities have increased over the past three years, in 
most cases without a commensurate increase in funding availability.
    The agency is attempting to reduce and streamline industry 
reporting requirements with a goal of 100 percent electronic reporting.
    Question. What is the target date for achieving this goal? How has 
this goal been viewed by industry?
    Answer. The Royalty Management Program's (RMP) target date for 
receiving 100 percent of its reports electronically is the end of 
fiscal year 1998. The industry is cooperative and recognizes the 
benefits of electronic reporting. The RMP currently receives 80 percent 
of its royalty reporting lines and 50 percent of its production 
reporting lines electronically which account for less than 10 percent 
of its total reporter universe. To assist reporters, the RMP provides 
free reporting software and many electronic reporting options that 
require minor conversion commitments. To ensure conversion, the RMP is 
drafting a proposed rule to require electronic reporting, but will 
include an exception for hardship cases.
    Question. How does the Indian Royalty Internship intend to achieve 
its objectives of having Tribes manage their minerals affairs? What is 
the long term objective in terms of specific transfer of functions to 
Tribes for performing royalty management work? What is the cost of this 
program? How will personnel costs be affected by this program?
    Answer. The program is intended for mineral producing Tribes 
considering self-governance or self-determination contracts and for 
Tribes who want to become more knowledgeable about royalty management. 
After consulting with the Tribes, we decided to offer a very flexible 
training program, built around on-the-job training and customized as 
much as possible to the needs of each participant. Interns can receive 
hands-on training in various aspects of RMP's mineral revenue 
management activities, including royalty accounting, report processing, 
exception resolution, audit, and valuation. The program will entail 
some classroom training, but will consist primarily of work assignments 
in one or more of our operating divisions.
    The MMS is committed to providing opportunities for Tribes to 
manage or monitor their own affairs with regards to mineral revenues. 
The Royalty Internship Program is being designed for two purposes: (1) 
to provide tools and expertise for Tribes to monitor and oversee their 
mineral interests as well as the royalty management functions MMS 
performs in behalf of Indians; and (2) to help Tribes gain the 
experience and information they need to make decisions about potential 
assumption of royalty management functions.
    Currently we have one intern from the Cherokee Tribe in the 
program. We have received interest from several other Tribes and expect 
to begin two additional intern training programs later in year. Costs 
for the program are difficult to predict until we have worked with the 
individual Tribes to design the best program for their needs. The cost 
for the initial trainee is expected to be less than $20,000.
    We do not anticipate any change in personnel costs due to this 
program. The objective of the internship is to provide Tribes with 
enough information so they can make an informed decision concerning the 
assumption of Federal duties regarding the management of their mineral 
resources. It is unknown at this time what, if any, functions may be 
assumed by the Tribes.
    In June 1996, the agency announced plans to streamline its EIS 
process.
    Question. Has this effort been fully implemented? In the Gulf of 
Mexico, the agency states that ``EIS work for the period 1997-2002'' 
will be reduced by 80 percent due to streamlining. What specific 
requirements have been eliminated to result in such a reduction of 
process? What cost savings have resulted from this streamlining effort? 
Has this increased the vulnerability to environmental appeals?
    Answer. We are streamlining the EIS process in two ways. First, we 
are providing more focused, narrowly written lease sale EISs, making 
them less repetitive, less voluminous, less expensive to print and 
distribute, and easier to use. A recent lease sale EIS in the Gulf of 
Mexico (Sales 166 and 168) was reduced in size by 35 percent resulting 
in a $9,800 savings in printing and distribution costs. This savings 
was accomplished through improved internal procedures for document 
preparation while continuing to fulfill NEPA requirements. Making these 
documents more readable will not increase our vulnerability to 
environmental appeals.
    A second effort, limited to the Central and Western Gulf of Mexico 
planning areas, is also under way. We are eliminating the repetitive 
issuance of lease sale EISs for annual sales in the Central and Western 
Gulf. The results of such sales are similar in nature and level of 
environmental impact. The Council on Environmental Quality (CEQ), in 
their regulations at 40 CFR 1502.4(c)(2), recommends assessing similar 
actions in a single EIS. We cover all approved proposed sales in each 
planning area in one EIS. Producing, printing, and distributing two 
multisale EISs instead of five annual lease sale EISs is estimated to 
save approximately $110,000 over a five year period. While this is a 
reduction of up to 80 percent in the cost of preparing and publishing 
lease sale EISs, it does not result in a concomitant reduction of NEPA 
work and manpower requirements. In order to meet CEQ requirements, we 
conduct an additional NEPA analysis for each lease sale to ascertain 
whether the coverage in the ``multisale'' EIS is still applicable. The 
Environmental Assessment (EA) or Supplemental EIS (SEIS) that results 
from this analysis cost somewhat less than the EIS's that were produced 
annually. The principal cost savings result from the fact that an EA 
does not entail publication and distribution costs, and an SEIS, if and 
when required, is a much smaller document than a full EIS.
    By using a multisale EIS approach, coupled with additional sale 
specific NEPA coverage, MMS can continue to fulfill its environmental 
requirements, and there should be no increased vulnerability to 
environmental appeals.
    Question. What are the receipt implications of allowing the 
Secretary more discretion to set royalty terms which adjust 
automatically to changing market conditions?
    Answer. Our royalty receipts already adjust automatically to market 
conditions. Since the vast majority of Federal leases have ad valorem 
royalties, royalty receipts vary directly with the value of production. 
However, one could increase the Government's share of market risk by 
making the royalty rate vary with changes in prices or production 
value. In principle, given a set of expected market conditions, one 
could design royalty terms that, on average, would provide the same 
revenues as the current, fixed royalty rate terms. However, the 
receipts could increase or decrease, depending on; 1) the formula used 
to adjust the royalty rate; and 2) actual market conditions.
    The agency claims to have made significant reductions in 
procedures, processes, and paperwork, through an aggressive 
reengineering effort. These reductions have been cited as offsetting 
the need for significantly more funds to meet rising agency demands.
    Question. How does the agency account for the ability to make such 
significant reductions? Was it inherently inefficient prior to the 
reengineering effort? As the effort to further reduce the Federal 
budget deficit continues into future years, should it be expected that 
the agency will be less able to accomplish significant reductions?
    Answer. Recent operational and procedural efficiencies in MMS have 
been motivated by a number of internal and external initiatives. These 
include:
  --Implementation of Congressional legislation meant to reduce 
        regulatory reporting requirements for industry.
  --Implementation of Congressional and Administrative initiatives to 
        streamline and downsize Federal agencies.
  --Advances in electronic technology.
  --Frequent reviews of MMS processes by internal staff and oversight 
        organizations, to assure program objectives are accomplished 
        and customer needs are met.
    The MMS is committed to continuously looking for ways in which to 
improve the efficiency and effectiveness of its operations while 
delivering high quality service to its customers at the lowest possible 
cost. Through aggressive performance improvement initiatives and now 
reengineering, MMS has been able to identify ways to simplify its 
regulatory requirements; consolidate and flatten its organizational 
structure; and streamline or eliminate internal procedures, processes, 
and paperwork needed to accomplish its mission. In some cases, 
organizational structure, work processes, and regulatory requirements 
were found to be inefficient and in need of improvement, yet in other 
cases significant advances in technology and automation have permitted 
program performance gains.
    In looking toward the future, the RMP Reengineering Initiative is 
now addressing core business processes and support systems in its 
accounting, financial, and compliance operations. The objective of the 
initiative is to design, develop, and implement new business processes 
and support systems for the 21st century. Continued Federal downsizing 
and growing expectations for better service at less cost led us to 
conclude that maintaining the status quo, with improvements on the 
margin, is not an acceptable strategy for the future. Furthermore, the 
Royalty Simplification and Fairness Act of 1996 (RSFA) has served to 
amplify the need for us to pursue a strategy of significant change. 
Clearly, capability for further reductions will depend on both the 
success of the reengineering effort and future legislative 
requirements.
                       royalty simplification act
    This act was enacted in August 1996. The act provides for a seven 
year statute of limitations on royalty collections.
    Question. What are the receipts implications of the act relative to 
this statute? Over the past three years what total sums have been 
``receivable'' to the Treasury that are more than seven years in 
arrears?
    Answer. The MMS does not believe the seven year statute of 
limitations will impact compliance collections because the major 
initiatives currently underway apply mostly to production that occurred 
prior to September 1996, the effective date of the seven year statute. 
Assuming these and other special initiatives are timely completed and 
progress is made on current reengineering initiatives, such as 
shortening the lease compliance periods to much less than seven years, 
the RSFA statute period should not impact collections.
    By 2003, when the provision is fully effective, we believe we will 
be contemporaneous with respect to auditing as well as valuation and 
other issues. Our goal is to have leases verified in less than the 
seven year statute.
    When MMS issues a bill for royalty underpayment, the payment is 
accounted for in the year in which it is received. An audit identifies 
the period and amount of underpayment and calculates interest due. 
While we have the basic data needed in our Auditing and Financial 
System, a separate report/query is not maintained that would track how 
much of the total underpayments are attributable to any prior year(s) 
period. To provide ``receivables'' to the Treasury that are more than 
seven years in arrears would be time consuming and extremely 
burdensome.
    Question. How much interest has been paid by the agency since 
implementation of the act due to overpayment?
    Answer. The RMP has processed three months of royalty data 
(February, March, and April) since implementing the interest programs. 
During each month, we process the reports and payments received during 
the previous month. In other words, reports and payments received 
during February were processed during March. Since RSFA has an 
effective date of February 13, 1997, for interest due to payors for 
overpayments, only overpayments made and corrected after that date 
would be included in the interest due to payors calculations. Very few 
payments qualified under this criteria when we ran the first cycle 
after implementing the software. In fact, from the first run we 
calculated only 18 cents in overpayment interest due payors.
    The interest programs create prebills from which we verify the 
accuracy of the interest exceptions before the interest statements are 
sent to the payors. The prebill amounts have generally been reduced 
during prebill verification by up to 25 percent. For the March 1997 
reporting month, we have verified about 50 percent and we are just 
issuing some of the statements which reflect interest MMS owes the 
payors. The third cycle, the April 1997 reporting month, is in the 
early verification stages. The data below summarizes the information 
contained on the prebills.

                                   PREBILL INTEREST CALCULATIONS--(UNVERIFIED)                                  
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                         Reporting month--        March 1997 and
                                                                 --------------------------------   April 1997  
                                                                    March 1997      April 1997        totals    
----------------------------------------------------------------------------------------------------------------
Tentative interest owed to:                                                                                     
    Payors......................................................          $440.1          $703.1        $1,143.2
    MMS.........................................................         2,553.1         1,366.5         3,919.6
----------------------------------------------------------------------------------------------------------------

    The interest exception processing software reviews royalty lines 
only after the data has been verified through royalty edits. This 
process generally requires 30 days. At each month end, the interest 
module compares due and payment dates for accepted lines to generate 
prebills, which are manually reviewed and processed as final statements 
and mailed to the payors. Overall, 75 to 90 days pass between the time 
the royalty lines are received and the payors mailed interest 
statements. Overpayment and underpayment interest are netted together. 
The payor either pays the balance or can apply credits to their next 
royalty payment. If they are no longer a payor they will receive a cash 
refund.
                        state benchmarking study
    Question. What specific ``best practices'' have been identified at 
State auditing organizations that are likely to be implemented in the 
MMS Royalty Management Program?
    Answer. The ``Final State Benchmarking Study'' report prepared by 
the MMS Office of Policy and Management Improvement and issued February 
14, 1997, identified a variety of ``best practices'' of State royalty 
programs for potential adoption by RMP. The report states that these 
best practices may or may not be practicable for RMP to adopt, 
depending on further analysis of the feasibility of implementation, a 
process to be conducted within RMP's Reengineering Initiative.
    The RMP Reengineering Initiative is currently addressing core 
business processes in its accounting, financial, and compliance 
operations. As a part of the process, we are examining the feasibility 
of adopting/adapting ``best practices'' of a wide variety of financial, 
accounting, and compliance organizations. The principal audit-related 
``best practice'' identified in the above-mentioned report was to 
conduct audits in two year increments. Currently MMS conducts audits in 
three to six year increments. Reducing the time increments addressed by 
audits is consistent with one of the ``stretch goals'' of the 
Reengineering Initiative; i.e., to assure compliance with applicable 
laws, lease terms, and regulations for all leases in the shortest 
possible time, but no later than three years from the due date. 
However, it is still too early in the Reengineering Initiative to 
confirm if or how this ``best practice'', as well as the other ``best 
practices'' identified in the above-mentioned report, will be included 
in RMP's future business processes. We anticipate completing the 
development of the preliminary design of our future business processes 
by the end of the calendar year.
                   national petroleum reserve support
    The agency has been chartered to support BLM in development of 
leases in the National Petroleum Reserve-Alaska (NPR-A). This follows a 
reduction in the size of MMS's Alaska Regional Office by 50 percent. 
This effort is planned for fiscal years 1997-99. The Subcommittee 
understands that tentative plans are for BLM to pay the cost of support 
items which are above normal salary for MMS employees involved in this 
project.
    Question. Is the above assumption about costs correct?
    Answer. Yes, the assumption is correct. The BLM will reimburse MMS 
for all above normal salary costs. These costs include any overtime 
compensation as well as all non-personnel costs, e.g., travel, 
printing, and data acquisition, incurred by MMS in support of the NPR-A 
effort.
    Question. What planned work will not be accomplished as a result of 
assigning MMS employees to this effort?
    Answer. To allow for this effort, MMS will defer action on the Cook 
Inlet Sale 173 which has been proposed in the approved Outer 
Continental Shelf (OCS) 5-Year Plan for 1997-2002. The prelease work 
for this sale was to begin this fiscal year and continue through 1999, 
which is the scheduled date for this sale. Following completion of NPR-
A review, action on the Cook Inlet Sale 173 will resume and the sale 
may be conducted in the year 2001. This delay in Sale 173 is not 
considered to be a significant action and, thus, will not affect the 5-
Year Plan for 1997-2002.
    Question. Will the MMS need to hire additional employees to 
compensate for the temporary loss of these permanent employees?
    Answer. The MMS staff will be diverted from planned activities in 
support of Cook Inlet Sale 173 in order to pursue the NPR-A review. As 
a result, it will not be necessary to hire any additional employees, 
either permanent or temporary, nor will it be necessary to shift funds 
between planned budget activity or sub-activity levels.
              outer continental shelf--regulatory program
    The agency expects a significant increase in demands for services 
from its regulatory program as a result of renewed interest in Gulf of 
Mexico production. The cost of conducting the regulatory function will 
increase.
    An additional $1.9 million is being requested. With leasing 
activity occurring further offshore and the number of operators 
increasing, the agency must enhance its attention to regulatory 
functions.
    Question. With an increase of $1.9 million and 15 FTEs in this 
function, will demands for services match this increase? What 
shortfalls, if any can be expected? How will individual productivity 
measures be affected by the factors of greater complexity in the 
regulatory function?
    Answer. Demands on regulatory services in the Gulf of Mexico Region 
(GOMR) are expected to increase rapidly for the remainder of fiscal 
year 1997, through fiscal year 1998, and into fiscal year 1999. These 
expectations are based on an understanding of industry's commitment to 
exploring and developing the current lease inventory as well as on 
current statistical observations. Offshore operators have significantly 
increased their lease inventories through leases obtained in recent 
GOMR OCS lease sales. The increase in demand on services in the GOMR in 
the regulatory function can be attributed to (1) an increase in 
activity based on higher oil and gas prices and available lease 
inventories; and (2) more complex operations.
    Increased demand has already been experienced in two areas of our 
regulatory function. The amount of rig activity rose 20 percent in 
fiscal year 1996 and another 20 percent during fiscal year 1997. 
Second, the number of plans of exploration and development have 
increased by more than 100 percent over the past two years. Further, 
the plan review workload has also increased because of the additional 
time required to review the more complex plans, such as Deepwater 
Operating Plans (DWOP). Several very complex deepwater structures 
(Mars, Ram Powell, and Neptune) have been installed in fiscal year 1997 
and several more are planned for fiscal year 1998 and beyond. These 
facilities represent a significant level of capital expenditures for 
projects that will be in place and operating over a 10 to 20 year life. 
These development plans, along with the industry's plans to build at 
least five new deepwater drilling rigs by the end of fiscal year 1998, 
demonstrate the offshore operators' long-term commitment to developing 
their lease inventories in the Gulf. These more complex facilities 
require a substantially longer amount of time to review and to inspect. 
The review of these projects now entails a multi-disciplinary review 
through the DWOP. Many of the projects propose to use substantial 
amounts of new technology. Since most of these new approaches are not 
addressed in the current regulations, they must be analyzed on a case-
by-case basis to determine if the intent of the regulations is met. (It 
is not uncommon for a DWOP to request waivers from 27 regulations.)
    On the inspection side, these new, more complex facilities take 
longer to inspect than the typical production facility in the shallower 
shelf region. In many cases, two or more inspectors may have to be 
assigned to inspect these facilities where one is the norm. These 
facilities also are farther from shore and will require additional 
helicopter travel time. Longer flight times will directly affect 
inspector productivity; however, the proposed inspector FTEs should 
offset this loss in productivity.
    In addition to the deepwater activities, an increase in the 
activities offshore Alabama and in the Eastern Gulf have and will 
continue to stretch resources. Travel times to these areas, from 
existing MMS offices, is comparable to the deepwater areas, with 
equally complex facilities. To better utilize helicopter flight time, 
the District offices are using overtime budgets to keep inspectors in 
the field. The additional FTEs proposed will allow more flexibility in 
scheduling and better utilization of helicopter seat space.
    In short, we are certain that the full $1.5 million/15 FTE increase 
requested in Regulatory Operations is necessary for MMS to keep up with 
the increased workload associated with heightened industry activity in 
the Gulf. Through careful management of budget and personnel resources, 
such as concentrating inspector resources on problem areas and 
performing pre-installation inspections, as described below, we do not 
anticipate any shortfalls.
    In many cases, engineers and inspectors travel to onshore 
fabrication yards to inspect subsea systems that cannot be physically 
inspected once they have been installed on the seafloor. These trips to 
the fabrication yards also are used to conduct pre-production 
inspections for the most complex facilities. These trips often save the 
operator expensive changes in the field and save helicopter flight time 
for MMS. Due to the complexity of these facilities, consideration must 
also be given to the training that will be needed to support these 
approval and inspection activities.
    Question. How will the costs of supporting employees involved in 
the regulatory function (travel, helicopter time, etc.) be affected by 
the greater complexity in this program?
    Answer. The support costs will definitely increase, as mentioned in 
the answer to the previous question, because these new, more complex 
facilities take longer to inspect than the typical production facility 
in the shallower shelf region. In many cases, two or more inspectors 
may have to be assigned to inspect these facilities where one is the 
norm. These facilities also are farther from shore and will require 
additional helicopter travel time.
    In addition to the deepwater activities, an increase in the 
activities offshore Alabama and in the Eastern Gulf have and will 
continue to stretch resources. Travel times to these areas, from 
existing MMS offices, is comparable to the deepwater areas, with 
equally complex facilities.
    The agency states that a transition is occurring in production 
operations from large companies to significantly smaller operators with 
less financial resources.
    Question. How has this trend increased direct inspection costs? How 
has this transition affected compliance with regulation and policy? 
What are comparative enforcement activity figures for the past five 
years? How have FTEs assigned to the enforcement function changed over 
the past five years?
    Answer. Many of the large multinational companies are making the 
move to the large fields anticipated in the deepwater areas of the 
GOMR. To make this transition to deepwater from the shallower shelf 
region, many of these companies are selling off their interest in 
shallower water fields to smaller companies that can make a profit 
based on their lower overhead. Some of these small operators, who are 
taking over these mature fields have never operated in the GOMR. These 
fields are generally characterized by aging infrastructure with 
declining production. Some of these facilities were installed in the 
late 1950s and are in need of constant attention by the operator. The 
MMS has concentrated some of its efforts at reviewing the condition of 
these facilities, prior to an operator transferring these facilities to 
an operator with significantly less financial resources, and in 
visiting the new operator to make sure regulatory compliance occurs. 
Our inspections have identified that some of these operators are 
unfamiliar with OCS regulations and compliance issues. The level of 
operating experience has also decreased at many of these field 
locations. For these reasons, our inspectors spend more time at these 
facilities for noncompliance and compliance education purposes. Our 
managers also spend time meeting with operators stressing the 
importance of safety.

                               FIVE YEAR COMPARATIVE ENFORCEMENT ACTIVITY FIGURES                               
----------------------------------------------------------------------------------------------------------------
                                                              1992       1993       1994       1995       1996  
----------------------------------------------------------------------------------------------------------------
Incident of noncompliance................................      4,139      4,044      3,662      3,866      4,826
Production INCs\1\.......................................      3,596      3,414      3,299      3,570      4,463
Drilling INCs\1\.........................................        543        630        362        296        363
Warning..................................................      1,754      1,587      1,286      1,482      1,976
Component shut-in........................................      2,246      2,229      2,238      2,186      2,556
Facility shut-in.........................................        139        228        138        198        294
Civil penalties paid.....................................  .........  .........         15         19         32
----------------------------------------------------------------------------------------------------------------
\1\  Incident of noncompliance [INC].                                                                           

    FTE's assigned to inspection/enforcement have been relatively 
stable as new efficiencies were implemented to keep up with the growing 
workload. While this has helped, we now need more FTEs to monitor and 
ensure compliance.
    Enactment of the Deep Water Royalty Relief Act has spurred a 
significant increase in Gulf of Mexico leasing activity. The Budget 
Summary states that ``by 1998, the enormous increase in the number of 
active leases in the Gulf of Mexico will require a redirection of 
resources'' to ensure managing the program in a ``safe and 
environmentally sound manner.'' This new activity will require 
additional resources in all areas of the regulatory program.
    Question. Is MMS adequately prepared to keep pace? Is the $6.3 
million increase sufficient?
    Answer. The GOMR believes the $6.3 million increase will be 
sufficient to meet the demand on services through fiscal year 1998. The 
GOMR has made several changes to ensure that the OCS program is managed 
in a ``safe and environmentally sound manner.'' These changes include 
promoting performance-based regulations and the Safety and 
Environmental Management Program (SEMP). These changes to the MMS 
regulatory program will lead to a different strategy in the inspection 
and enforcement program. In many cases, MMS will analyze trends and 
operator performance and will conduct risk-based inspections.
    Enforcement actions will be based on these indicators rather than 
the current prescriptive requirements. The GOMR has also moved to the 
use of statistical sampling and clustering of offshore structures to 
make more efficient use of current inspection resources.
    Question. What are projections for how passage of this act will 
change receipts to the Treasury?
    Answer. The Deep Water Royalty Relief Act (DWRRA) will impact 
Federal receipts in several ways. First, additional tracts will receive 
bids in near-term sales. Second, tracts that would have been bid on 
anyway will tend to receive higher bids. Third, there will be less 
royalties collected to the extent leases qualify for royalty relief.
    Preliminary results on leasing activity tend to indicate 
significant positive impacts on bonus and rental receipts from DWRRA. 
However, it is difficult to statistically separate the impact of DWRRA 
from other possible effects arising from improved economic and resource 
factors which have also tended to spur leasing activity.
    Concerning possible royalty impacts, there is not adequate data 
from exploration and production to reliably estimate this effect at 
this time. The MMS has only recently issued final regulations under 
DWRRA, and only one application for relief has been received (and 
granted). Thus, it is virtually impossible to derive accurate estimates 
of these various, and countervailing, factors at this time.
    Question. Has passage of the act spurred any increased interest in 
OCS leases in Alaska? What additional incentives could improve Alaskan 
OCS production potential?
    Answer. Most of the provisions of the Deep Water Royalty Relief Act 
apply only to the Gulf of Mexico, west of 87 degrees, 30 minutes west 
longitude. The one exception is DWRRA's discretionary authority to 
offer leases with royalties suspended for a period, volume, or value of 
production determined by the Secretary. The Secretary has not exercised 
this authority outside of the portions of the Gulf of Mexico where such 
royalty terms are mandatory. Therefore, DWRRA has not had any effect on 
the Alaska OCS program.
    The MMS continues to monitor the health of the OCS industry in all 
regions. Should incentives be warranted, we have regulatory tools in 
place to provide appropriate financial incentives. On February 2, 1996, 
MMS published a final rule modifying the regulations governing the 
bidding systems used to offer OCS tracts for lease. The regulations now 
give the Department flexibility to offer leases with financial terms 
other than the traditional one-eighth royalty, including terms similar 
to those in place for the deep water areas of the Gulf of Mexico. The 
Department considers options for financial terms on a sale-by-sale 
basis as part of the individual lease sale planning process. As part of 
this process, MMS would consider any comments it receives on the 
financial terms in the Proposed Notice of Sale before making a final 
decision on those terms. In addition, on May 31, 1996, MMS published an 
interim rule modifying the regulations governing royalty relief on 
existing leases. With respect to the Alaska OCS, MMS may grant relief 
for producing leases if revenues are inadequate to sustain production 
or for projects to expand production that would be uneconomic without 
royalty relief.
                         environmental studies
    The administration proposes to increase funding in this program to 
$14.4 million. This is an increase of $1.5 million. The agency budget 
justification does not reflect any FTEs for this function.
    Question. While the justification speaks to leveraging with other 
agencies, State and local governments, and industry, what function 
manages the overall studies program? What portion of this funding is 
associated with program administration? Assuming the Leasing and 
Environmental Assessment function oversees the Environmental Studies 
function, what amount of FTEs are attributable to the environmental 
studies program?
    Answer. Management of the Environmental Studies Program (ESP) is 
carried out under the Leasing and Environmental Assessment Program. 
None of the ESP funding request is associated with program 
administration. All of the ESP budget, including the requested 
increase, will be directed to scientific research. The MMS has 
integrated management of the ESP throughout the Leasing and 
Environmental Assessment function so that many staff will participate 
in the management of studies as well as the preparation of NEPA 
documents. This approach facilitates utilization of studies results in 
NEPA documents and decisions. Approximately 43 FTE, including technical 
and clerical staff, are distributed in Headquarters and the Regions, 
and are involved in oversight of the Environmental Studies Program.
                               moratoria
    The Administration now has in place a five year plan for 
development of oil and gas from the OCS. I believe this plan was 
developed pursuant to the requirements of the Outer Continental Shelf 
Lands Act and other relevant environmental statutes. Under the law, no 
oil and gas development can occur during the pendancy of the five year 
plan in areas of the OCS not specifically identified in the plan.
    In its fiscal year 1998 budget, the Administration has requested 
continuation of the various OCS development moratoria that have been 
included in the Interior Appropriations bill for a number of years. 
However, I don't believe any of the areas covered by the moratoria are 
included as possible development sites in the five year plan.
    Question. In light of this fact, aren't the legislative moratoria 
redundant? Why do you put so little stock in your own five year plan? 
Doesn't this amount to an appropriations rider that supersedes existing 
environmental statutes?
    Answer. The President's fiscal year 1998 Budget does not propose to 
continue the current moratoria in their present form. Rather, the 
proposed budget includes amendments that would conform the moratoria 
provisions to the newly-approved 5-year OCS oil and gas leasing program 
for 1997-2002, which proposes leasing in an area that previously has 
been subject to moratoria.
    The current moratoria include restrictions pertaining to a specific 
lease sale--Eastern Gulf of Mexico Sale 151--that had been proposed in 
the 5-year program for 1992-1997 but was canceled in 1995. Proposed 
Eastern Gulf Sale 181 in the new 5-year program for 1997-2002 would 
offer a small portion of the area that had been proposed for leasing in 
Sale 151; this new proposed sale was developed in cooperation with the 
States of Florida and Alabama.
    Removing the outdated reference to Sale 151 is intended to clarify 
that the current restrictions would not apply to the newly-proposed 
Sale 181. In addition to striking the reference to Sale 151, the 
proposed amendments would replace a similar outdated reference to a 
specific Atlantic lease sale with more appropriate wording and would 
remove North Aleutian Basin drilling restrictions, that are no longer 
necessary, due to the expiration of all leases in that planning area. 
Thus, the revisions would have the effect of continuing the existing 
preleasing and leasing restrictions as they apply to areas excluded 
from the new 5-year program for 1997-2002.
    By proposing to remove moratoria restrictions that are ambiguous or 
inconsistent with the provisions of the new 5-year program, the 
Administration hopes to clarify and strengthen the role of the 5-year 
program in implementing our OCS leasing policies while also 
acknowledging that there is still considerable constituent support for 
continuing the current restrictions that apply to certain areas 
excluded from the program. We have made conflict resolution a high 
priority in managing the OCS program, and we believe that continuing 
the moratoria as they apply to the areas that are excluded from the new 
5-year program will support our overall conflict resolution efforts. 
Although we have developed a leasing program based on science and 
consensus, which includes the small portion of the Eastern Gulf of 
Mexico Planning Area that previously was subject to moratoria, we 
realize that longer term efforts will be necessary to resolve conflicts 
related to the other areas under moratoria. We believe that continuing 
the moratoria as they apply to those areas will provide a useful 
foundation for those efforts, as the restrictions serve to assure 
stakeholders that the status quo will be maintained while discussions 
of relevant issues ensue. Thus, unlike previous moratoria that did not 
conform to existing 5-year programs-and might be perceived as 
superseding existing statutes governing the formulation and 
implementation of those programs--the Administration views the 
provisions we are recommending for fiscal year 1998 as complementing 
the program for 1997-2002 and serving our longer term priorities.
    In light of the Senate question's reference to development 
moratoria, we wish to clarify that the new 5-year program and the 
proposed fiscal year 1998 moratoria language pertain only to preleasing 
and leasing activities. Thus, neither the 5-year program nor the 
amended moratoria language will directly affect the development of 
existing leases, including those located in areas subject to moratoria 
on future preleasing and leasing activities.
    Question. Recognizing that many areas of potential leasing are 
under moratoria, how have recommendations from this program affected 
planning for eventually proposing a complete or partial end to the 
moratoria?
    Answer. As explained in the answer to the previous question, the 5-
year program for 1997-2002 proposes a lease sale in a portion of the 
Eastern Gulf of Mexico Planning Area that currently is subject to the 
moratoria but would be available for leasing under the fiscal year 1998 
amendments to the budget recommended by the Administration. Proposed 
Sale 181, which is acceptable to a consensus of stakeholders including 
the Governors of Alabama and Florida, represents a small yet 
significant step on OCS moratoria.
    The new program's exclusion of OCS areas subject to moratoria in 
which there are existing leases--Southern California, Florida 
Panhandle, and North Carolina--is enabling us to focus on resolving 
issues related to those existing leases without having to deal with 
additional conflicts and controversies that proposed new leasing in 
those areas would engender. We are addressing issues related to 
potential development of the Southern California leases through a 
multiyear study--the California Offshore Oil and Gas Energy Resources 
Study (COOGER)--which involves representatives of MMS, the State of 
California, the three affected local counties, and the lessees and 
operators. We have established an information office in Pensacola to 
conduct local education and outreach efforts relating to the Florida 
Panhandle leases, and we are consulting with the State of Florida and 
other stakeholders concerning exploration and development plans in that 
area. We have successfully settled buyback litigation relating to the 
North Carolina leases with all but two of the companies holding those 
leases. We also are planning to work with the State and other 
stakeholders to resolve issues concerning the North Carolina leases 
that will remain in effect as a result of the settlement that has been 
reached with all of the other companies. We believe that if new leasing 
were proposed in these areas in the program for 1997-2002, these 
efforts would be seriously impeded, thereby prolonging conflicts and 
preventing the consensus-building needed to set the stage for 
considering even very limited additional leasing in these areas in 
subsequent 5-year programs.
    Question. How does the economic potential of areas under moratoria 
compare to other planning areas on the OCS?
    Answer. In Alaska, the North Aleutian Basin's economically 
recoverable resources of 0.02 billion barrels of oil (BBO) and 0.88 
trillion cubic feet (TCF) represent five percent on a barrel of oil 
equivalent (BOE) basis of the equivalent total Alaskan resource and 
less than one percent of the BOE OCS resource. The economically 
recoverable resources in the Pacific planning areas of 5.3 BBO and 8.3 
TCF represent 25 percent of the BOE OCS resource, while the 
economically recoverable resources in the Atlantic planning areas of 
0.4 BBO and 5.2 TCF represent five percent of the BOE OCS resource. The 
economically recoverable resources in the Eastern Gulf of Mexico of 1.1 
BBO and 4.9 TCF represent seven percent of the BOE. Therefore, in 
aggregate, approximately 37 percent of the OCS economically recoverable 
resources are expected to be in areas under moratoria.
    Question. Does the agency acknowledge an eventual need to enter 
areas currently under moratoria? If so, what steps are being taken to 
encourage the public's acceptance of leasing in areas presently covered 
by moratoria?
    Answer. The Department does not rule out the possibility that 
changing international conditions or evolving domestic conditions and 
attitudes eventually could result in future consideration of leasing in 
areas currently under moratoria and believes that such consideration 
should be based firmly on science and consensus. As previously stated, 
we are attempting to resolve issues related to existing leases in 
certain moratoria areas to build public trust. The Department also is 
attempting to identify scientific information needs for areas currently 
subject to moratoria, and as part of this effort, requested that a 
joint subcommittee of the OCS Policy and Scientific Committees of the 
Minerals Management Advisory Board conduct a review and provide 
pertinent recommendations to the Secretary. In May 1997 the 
Subcommittee on Environmental Information for Select OCS Areas Under 
Moratoria submitted its report, which presented 10 specific 
recommendations in support of proceeding with environmental studies in 
moratoria areas. This report has been approved by both the OCS Policy 
Committee and the Scientific Committee. The report is under review at 
the Department, and the Secretary has not yet responded to the Advisory 
Board concerning the recommendations.
                       royalty management program
    The agency proposes to reduce this program by $3.7 million and 36 
FTEs.
    Question. With increases in production expected, does the agency 
project an increased demand for services from the Royalty Management 
Program? How will valuation, operations, and compliance be affected? 
Has the agency identified program vulnerabilities in this area as a 
result of the personnel reductions?
    Answer. Although we project significant increases in the production 
of both oil and gas by the year 2000, it will occur mainly in the Gulf 
of Mexico, and be the result of deepwater drilling. Such production 
from a few large leases will have a much smaller impact on RMP workload 
than would increased onshore production which is characterized by 
hundreds of small lessees. The workload increases that will be 
realized, we believe can be absorbed through the efficiencies gained 
over the past two years involving the streamlining of reporting and 
internal processes, and organizational efficiencies resulting from the 
MMS 2000 Reorganization. We have not identified program vulnerabilities 
resulting from personnel reductions which would impact the current 
valuation, operations or compliance processes, even with the increased 
production levels discussed above.
    Question. Will the $3.7 million reduction in any way affect 
implementation of the Federal Oil and Gas Royalty Simplification and 
Fairness Act of 1996?
    Answer. The overall reduction of $3.7 million will be achieved 
through several streamlining efforts that have been in development and 
are now providing efficiencies, such as electronic commerce initiatives 
which are significantly reducing the error rates of the reporters, 
eliminating some processes no longer considered beneficial such as late 
and erroneous reporting assessments, and consolidating and flattening 
the organizational structure which reduced the need for some management 
positions. The impact of this reduction on the implementation of the 
Royalty Simplification and Fairness Act (RSFA) has not been completely 
assessed at this time. The RSFA was signed into law well after many of 
the streamlining initiatives referred to above were initiated. The 
requirements of RSFA provide for many changes in the way MMS conducts 
business, not the least of which is the need for several significant 
software changes. Some of those development efforts will take place 
this fiscal year through system reprioritization efforts.
    Question. Will efficiencies offset the program reductions? If not, 
what functions will be reduced?
    Answer. Yes, efficiency-derived savings should offset the program 
reductions. The MMS began a compliance reengineering effort in April 
1996 which has now been expanded to a full program reengineering 
undertaking. As a result of the compliance study, we are beginning to 
implement process improvements that will result in more efficient use 
of auditors' time. Several recommendations in the reengineering report 
will be implemented which will both meet the General Accounting Office 
audit standards, while at the same time significantly reduce the amount 
of administrative paperwork currently required of the auditors. This 
workpaper and process streamlining will enable us to continue to 
provide effective compliance coverage with fewer staff. In other parts 
of the program, several streamlining initiatives including an 
aggressive electronic reporting policy have enabled the program to 
continue to provide effective levels of service with significantly 
fewer Federal and contractor resources.
    An Office of the Inspector General audit report (96-I-1264) cited 
some weaknesses in negotiated royalty settlements. One specific finding 
included remarks about insufficient personnel in the Royal Management 
program to provide necessary documentation during negotiations.
    Question. Will there be further difficulties in carrying out basic 
Royalty Management functions due to a lack of personnel?
    Answer. The RMP has assigned two additional FTE for paralegal 
personnel to the Office of Enforcement specifically to assist in 
documenting negotiated settlements and civil penalty actions. Team 
members will assume greater responsibility for assuring settlement 
documentation is complete. We believe this will assure all the 
necessary internal controls will be in place.
    Interior's Office of the Inspector General budget justification 
states that ``MMS has not been successful in ensuring that all lessees 
and operators comply with its requirements to accurately and timely 
report the production and sale of oil and gas from Federal and Indian 
leases.'' The OIG states that this occurred because of ``the lack of 
strong deterrent against noncompliance.'' The OIG cited a backlog of 
unresolved exceptions totaling $21.2 million above the threshold for 
such exceptions.
    Question. What is MMS doing to reduce this backlog? What will 
prevent this situation from worsening with reductions in the Royalty 
Management program?
    Answer. To address the exception backlog the MMS added 10 employees 
for two-year terms to the Compliance Verification Division (CVD) and 
began implementation of a software development effort to streamline the 
follow-up process. As a result, the CVD has experienced a significant 
improvement in productivity and efficiency related to the Auditing and 
Financial System/Production Accounting and Auditing System (AFS/PAAS) 
comparison. During the January-April 1997 time frame, unresolved case 
closures increased 75 percent over the same 1996 period, from 3,200 to 
5,700, while AFS/PAAS triggered royalty collections which previously 
averaged about $1.5 million per month approached $2.5 million in May 
1997. The number of unresolved exceptions should continue to decline in 
the future.
    The MMS has conducted a limited pilot project on royalty-in-kind.
    Question. When additional efforts are undertaken with this program, 
will the agency test the OIG recommendation that royalty-in-kind 
involve government use of natural gas as opposed to marketing the gas 
commercially? If not, what are the agency objections to this proposal?
    Answer. With deregulation and easy access to an open gas market, 
there doesn't appear to be any additional benefits associated with 
designating specific production for a particular end user. In fact, 
such arrangements will likely result in additional transportation and 
administrative expenses for a given user versus acquiring the gas in 
the open market. Large Federal end users are currently taking advantage 
of the open access in the gas market and are currently negotiating 
better prices via the competitive market. This has been confirmed by 
MMS in recent discussions with the State of Texas who acknowledged this 
is what's happening with their own royalty-in-kind program.
      Office of Surface Mining, Reclamation and Enforcement (OSM)
                  appalachian clean streams initiative
    A $1 million increase is planned in this program for the purpose of 
restoring streams to pre-coal mining conditions and to combat acid mine 
drainage.
    Critics state that an increase to the Clean Streams Initiative has 
the potential to reduce funds available for high priority reclamation 
projects, including those that protect health and safety.
    Question. How has State funding of programs not related to the 
Clean Streams Initiative been affected? Please provide data since 1994 
showing total State funding program expenditures for non-clean stream 
initiative projects.
    Answer. Since the Appalachian Clean Streams Initiative (ACSI) was 
first conceived, it has been OSM's intention that the initiative not 
displace funding for regular State Reclamation Grants, but to instead 
fund it only through a net increase in State Reclamation Grant funding. 
However, as illustrated in the table below, OSM's goal of holding 
regular State Reclamation Grants harmless was not completely achieved 
in the fiscal year 1997 appropriations process, as Congress reduced 
regular grant funding by $2 million to accommodate $4 million in 
funding for ACSI. While the fiscal year 1998 President's Budget does 
include a small decrease ($678,000) for regular grants, that decrease 
is proposed as a means to offset uncontrollable cost increases, not to 
accommodate the $1 million increase proposed for ACSI. It must also be 
emphasized that all of the Appalachian Clean Streams projects funded in 
fiscal year 1997 were priority two projects listed on the State 
Abandoned Mine Land (AML) inventory and these projects have generated 
more than $4 million in contributions from other sources.
    The following table shows the funding history for regular State 
Reclamation Grants and Appalachian Clean Streams Initiative grants 
since fiscal year 1994. It should be noted that the history of the AML 
State Reclamation Grant program is characterized by fluctuating funding 
levels from one year to the next.

  FUNDING HISTORY FOR REGULAR STATE RECLAMATION GRANTS AND APPALACHIAN CLEAN STREAMS INITIATIVE GRANTS--FISCAL  
                                                      YEARS                                                     
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                  Enacted                                                       
                                           -------------------- 1996 \1\   Enacted  1997 \1\   Enacted  1998 \1\
                                              1994      1995                1996                1997            
----------------------------------------------------------------------------------------------------------------
Regular State reclamation program grants..   135,793   135,534   135,534   140,000   140,000   138,000   137,322
Appalachian clean streams initiative......  ........  ........    11,009  ........     4,300     4,000     5,000
                                           ---------------------------------------------------------------------
      Total \2\...........................   135,793   135,534   146,543   140,000   144,300   142,000   142,322
----------------------------------------------------------------------------------------------------------------
\1\ President's budget.                                                                                         
\2\ State reclamation program grants.                                                                           

    Question. How is the Clean Streams Initiative applicable to non-
primacy States? How are project funding decisions made in these States 
relative to the initiative?
    Answer. The Appalachian Clean Streams Initiative is broadly aimed 
at remediating the effects of acid mine drainage throughout the 
Appalachian region in both primacy and non-primacy States. In both 
cases, OSM financial assistance is provided to the State. The primacy 
versus non-primacy distinction is important in terms of the mechanism 
by which OSM provides the financial assistance and the source of the 
funds. In primacy States, OSM provides funding for Clean Streams 
projects through supplemental AML State Reclamation Grants. The fiscal 
year 1997 Interior Appropriations, as included in the Omnibus 
Consolidated Appropriations Act, earmarks up to $4 million for such 
grants. By contrast, the mechanism for providing Clean Streams 
financial assistance to non-primacy States, such as Tennessee and 
Georgia, is a cooperative agreement funded through OSM's Federal 
Reclamation program, the roughly $2.4 million budgeted each year for 
Federal high priority reclamation projects. The State of Tennessee will 
receive $325,000 in such cooperative assistance in fiscal year 1997. At 
present, OSM is evaluating potential projects in primacy and non-
primacy States for funding in fiscal year 1998. In non-primacy States, 
OSM selects Clean Streams projects in concert with appropriate State 
agencies and local watershed organizations.
    The Department's Office of the Solicitor states that their office 
has provided extensive legal support to this initiative. The Office 
states that methods are being pursued to enlist industry's assistance 
in reclaiming abandoned mine lands.
    Question. What interest has been expressed by industry in 
participating in the Clean Streams Initiative? Are specific projects 
being planned for accomplishment with industry participation? What 
methods of industry participation are planned (cash payment, in-kind 
participation, etc.)?
    Answer. The Appalachian Clean Streams Initiative is an effort by 
OSM to establish partnerships with other government, non-government, 
and public groups that will work together to clean-up streams impacted 
by acid mine drainage (AMD). The focal point of these various 
partnerships is the ``Statement of Mutual Intent,'' co-sponsored by OSM 
and EPA-Region III that was signed in February 1995. A strategic plan, 
developed as a part of the Statement of Mutual Intent, envisioned 
several industry-related objectives: site-specific clean-up projects 
with partners, including industry; industry financed projects; and 
encouraging more remining of AML lands in order to gain reclamation 
benefits such as cleaned-up or improved streams. The mining industry 
has been involved in the Clean Streams Initiative by contributing funds 
for specific reclamation projects, donating land for use in project 
construction, and providing in-kind services, such as equipment, design 
advice, or other project leadership/partnering contributions.
    The OSM-sponsored Acid Drainage Technology Initiative is designed 
to complement the Clean Streams Initiative by focusing on coal mining 
operations in the planning phase, during operations, or prior to bond 
release. One objective of this initiative is to identify high-risk acid 
or toxic areas prior to permits being issued by the regulatory 
authority. A second objective is to use state-of-the-science design for 
operations so that AMD does not result in offsite damage or lead to a 
long-term problem that may require perpetual treatment. The success of 
this initiative largely revolves around the coal mining industry being 
willing to assist in developing workable strategies that will result in 
lowered risk of unanticipated AMD problems from active mines.
    The OSM is also encouraging remining and its associated reclamation 
benefits under Title V of the Surface Mining Control and Reclamation 
Act (SMCRA) through various activities. Specific remining projects are 
being developed by industry, with participation of the regulatory 
authorities, which address serious water quality issues. The OSM, EPA, 
and States are participating on an interagency task force that, in 
part, is examining water issues associated with the Clean Water Act 
that appear to be impediments to remining.
    Furthermore, OSM is working on a separate initiative to develop 
approaches under Title IV of SMCRA that will result in more reclamation 
of abandoned mine land. One specific Title IV approach could save AML 
Fund dollars through encouraging industry to restore abandoned mines by 
using proceeds from the sale of incidental coal recovered in the 
process to help finance the projects and to provide a reasonable profit 
to the operator. In fiscal year 1996 the agency obligated $7.3 million 
for emergency projects.
    Question. What has been the emergency obligations for the four 
years prior? Does the $7.3 million include states with emergency 
reclamation programs?
    Answer. Shown below are emergency project obligations for fiscal 
years 1992 through 1996 as reported in the OSM's annual reports.

Emergency project obligations for fiscal years 1992-96 in whole dollars

1996..........................................................$7,240,542
1995.......................................................... 8,788,444
1994..........................................................10,742,901
1993..........................................................10,184,885
1992.......................................................... 9,532,398

    These totals do not include emergency project obligations from 
States which have opted to assume the emergency reclamation program 
from OSM. It should be noted that Ohio and Indiana assumed their 
emergency programs in fiscal year 1993 and fiscal year 1995 
respectively.
    Also, it should be noted that the above numbers do not reflect the 
$7.2 million that was provided to conduct emergency reclamation in 
Kentucky, as part of the President's disaster relief fund in 1994.
    Question. What is the historic backlog of reclamation projects 
which can be funded from Abandoned Mine Land funds? How has this 
backlog been affected by the change of minimum program level funding 
from $2 million to $1.5 million?
    Answer. The Abandoned Mine Land Inventory System reports 4,580 high 
priority sites remaining to be reclaimed. An estimated $2.5 billion is 
needed to reclaim these sites. The reduction in the minimum program 
funding has no discernible affect on the overall reclamation efforts of 
the program; it does transfer the reclamation achievement from some 
States to others. The minimum program States all have efficient, well 
run programs. Funds granted to those States are used primarily to abate 
health and safety hazards stemming from abandoned coal mines. This is 
also true of funds granted to the non-minimum program States. Thus, 
changing the distribution pattern due to a change in minimum program 
levels does not affect in a substantial way the overall amount, 
priority, or quality of reclamation. For the minimum program States, 
the reduction to $1.5 million means that less health and safety 
problems will be corrected than would be addressed if $2 million was 
the funded minimum level, as stated in the Surface Mining Act.
    The Interstate Mining Compact Commission recommends higher 
allocations from the AML fund.
    Question. Within existing staffing and support structure, could OSM 
manage an increased allocation to States from the AML fund?
    Answer. If additional appropriations for grants were provided, OSM 
could distribute the additional funds to States without impacting the 
existing staffing and support structure of OSM.
    The National Association of Abandoned Mine Land Programs and the 
Interstate Mining Compact Commission submitted to the Secretary and the 
Director of OSM, a proposed plan for distributing the accumulated 
balance in the AML Fund to the States in order to accomplish more on-
the-ground reclamation projects. The Department has been petitioned to 
distribute the accumulated balance in the AML to the States.
    Question. What is the agency reaction to this request? What 
interaction has the agency had with the States regarding this proposal?
    Answer. Staff from OSM have discussed this proposal with the States 
and Indian Tribes on several occasions and have sent informal comments 
on the plan to the National Association of Abandoned Mine Land 
Programs. At this time, OSM is not in a position to support this 
proposal because it would involve amending SMCRA and would result in a 
substantial increase in appropriations from the AML Fund.
                       acid mine drainage policy
    A March 31, 1997 policy statement, says that prevention, 
correction, and control of acid mine drainage is one of the agencies 
top priorities.
    Concern has been expressed that emphasis on projects such as this 
will take funding from higher priority health and safety projects 
associated with the abandoned mine land reclamation fund. The agency 
responded that States can pursue abandoned mine funding through 
intergovernmental agreements with the Natural Resources Conservation 
Service (NRCS).
    Question. How much funding has been utilized by States in 
cooperation with the NRCS for projects which could be funded from 
abandoned mine funds?
    Answer. Acid mine drainage creates environmental and water 
pollution problems that frequently cause health, safety, and general 
welfare problems. These AMD-related problems represent as great a 
problem to the citizens in the coal fields as abandoned mine sites. A 
cooperative effort between OSM, NRCS, and the State and tribal programs 
is ongoing to identify areas that can be reclaimed through partnership 
efforts. We are encouraging State programs to maximize the reclamation 
they do by pursuing sources of funding other than their AML grants, 
including funds previously appropriated for the Rural Abandoned Mine 
Programs (RAMP) but not yet spent. Already two such sites have been 
identified, one in Oklahoma and one in Tennessee. The former has an 
estimated cost of approximately $250,000; the latter has a cost 
estimated at over $1 million. It should be pointed out that the funding 
coming from NRCS is AML funding from previous appropriations to RAMP 
that is not yet spent.
    Question. What level of ongoing interaction occurs with NRCS 
relative to administration of the Rural Abandoned Mine Program? Are 
cooperative projects between OSM and NRCS in operations? Is there 
coordination regarding expenditures from the RAMP trust fund?
    Answer. In past years, RAMP and several State programs were 
carefully coordinating reclamation projects before the RAMP 
appropriation funding was curtailed. There were committees on which 
NRCS, OSM, and State officials sat and decided which projects would be 
funded and who would have the overall responsibility for a project. 
These committees still exist in those States and NRCS still provides 
input into the program. These committees also are facilitating the 
take-over of RAMP projects by the State programs. The OSM and NRCS are 
currently developing a new Memorandum of Understanding which will 
promote efficient use of the AML fund and the skills and talents of the 
NRCS personnel. In addition, OSM, NRCS, and the States are coordinating 
projects. Two such sites have been identified; other possibilities have 
been located. As each is undertaken, it will be done with a combined 
funding of NRCS and State, tribal, and OSM funding as applicable.
                      primacy and abandoned mines
    Currently three Tribes are administering approved abandoned mine 
reclamation programs but do not have primacy.
    Question. What is the status of the effort to give Indian Tribes 
primacy?
    Answer. Currently, SMCRA does not allow any Tribe to assume 
primacy. The Energy Policy Act of 1992 renewed interest in tribal 
regulatory program development by amending SMCRA to add a new Section 
(710(I)) which provides that the Secretary will make grants to the 
Crow, Hopi, Navajo, and Northern Cheyenne Tribes to develop tribal 
regulations and program policies with respect to surface mining; assist 
OSM in the permitting, inspection, and enforcement of surface mining 
activities on Indian lands; and sponsor employment training and 
education. Consistent with Energy Policy Act provisions, the Department 
of the Interior issued grants from BIA and OSM funding totaling 
$480,000 in fiscal year 1996 and $600,000 in fiscal year 1997 to the 
Tribes to assist in establishing a surface coal mining regulation unit 
for each Tribe.
    The OSM staff met with Crow, Northern Cheyenne, Navajo, and Hopi 
tribal representatives in a series of meetings in 1996 to develop draft 
legislation that would allow tribal governments to assume SMCRA 
primacy. The last meeting occurred on November 13, 1996. Each meeting 
has resulted in bringing the Tribes closer to an agreement as to the 
language of the draft legislation.
    On April 14, 1997 OSM sent a letter to the Tribes requesting that 
they review a final draft of the legislation and asked for further 
input. The Navajo Nation has advised OSM that they want to meet one 
more time to discuss the draft legislation. A meeting will be scheduled 
and, depending on the outstanding issues among the Tribes, OSM will 
then make recommendations to the Secretary on how best to proceed with 
the legislative initiative.
    The State of Tennessee has relinquished regulatory authority.
    Question. Are other States considering this action?
    Answer. The OSM is unaware of any other State which is considering 
relinquishing primary regulatory responsibility.
                          coal mine complexity
    The agency budget justification speaks to increased production from 
a reduced number of mines. Permitted acreage has increased to 4.2 
million. Technology has rapidly advanced.
    Question. How has the skill level of OSM employees been affected by 
the technological changes? How have changes in technology affected the 
skill level of State and tribal regulators? How have agency training 
costs been affected?
    Answer. Through OSM's Technical Training Program, the technical 
competence and professional knowledge of OSM, State, and tribal 
personnel has risen commensurate with technological advances and 
changes in coal mining and reclamation operations. Each year, the 
program trains approximately 700 State and tribal students and 300 OSM 
students. Regulatory and reclamation staff must make numerous and 
complex technical judgments while performing their duties. To update 
this technical expertise, the Technical Training Program continues to 
develop new courses in response to customer requests and advances in 
technology. The program has added numerous courses which specifically 
focus on the application of the most appropriate technology. For 
example, courses were recently developed to teach the latest 
technologies in predicting, controlling, and abating acid-mine 
drainage. Additional new offerings include five field intensive 
workshops on the most appropriate technologies and methods to abate the 
abandoned mine land problems of subsidence, landslides, mine fires, 
dangerous highwalls, and dangerous openings.
    Courses are continually updated to include new practical 
applications resulting from technological changes including the latest 
materials and methods for erosion and sediment control, use of computer 
modeling in hydrology courses, use of global positioning units for 
field classes such as applied engineering, and the latest research on 
vegetation practices. Special emphasis is given to differences in the 
application of technology in different climatic and geographic areas.
    By making these technological updates available through the 
training program, State, tribal, and OSM regulatory and reclamation 
staff have access to information that improves their knowledge of on-
the-ground conditions and this enables staff to make better decisions 
about permitting, bonding, inspection, and optimal abatement of 
abandoned mine land problems.
    The OSM has held its technical training budget relatively constant, 
so the training program has responded to the aforementioned trends by 
offering fewer sessions of several older and more fundamental classes 
and shifted some funding to meet advanced technical needs as newer 
courses are more costly. For example, more complex subject matter 
requires the use of additional instructors for each course, so that 
courses which are being offered on acid mine drainage require 
instructors who have specific expertise in geo-hydrology, soil science, 
plant and aquatic ecology, and water chemistry; the AML Design 
workshops require civil and mining engineers, AML project managers, and 
geologists; and the Wetlands Awareness and Erosion and Sediment Control 
courses require experts who are versed in the specific climatic 
conditions, soils, and vegetation of an area of the country.
    This has had the effect of limiting the number of participants and 
increasing the travel costs because students may have to fly if only 
one session of a course is held nationwide. The reduction in basic 
course offerings means that not all State and Tribal new hires or staff 
requiring cross-training will have their needs met. Additionally, while 
the overall number of program offerings has increased, demand also 
exceeds available spaces for courses in advanced technology.
    Question. How has the cost of mining coal changed? Is there 
comparative data available showing changes in the cost per unit for 
mining coal?
    Answer. The OSM does not collect this type of data, and the agency 
is unaware of any readily available information source. However, over 
the last decade, coal mining productivity has risen at an average 
annual rate of 6.6 percent, including an eight percent increase from 
1994 to 1995. Much of this productivity gain results from an increase 
in both the number and efficiency of underground mines using the 
longwall extraction technique.
    The agency reduced its workforce by approximately one-third in 
fiscal year 1996.
    Question. After implementation of this significant downsize has 
full organizational alignment been achieved? Are all employees located 
in the most efficient locations and properly matched with their 
respective specialties?
    Answer. Immediately after OSM's reorganization and downsizing, the 
staff experienced difficulties maintaining the same level and quality 
of program delivery. Many employees affected by the reduction in force 
were placed in different programs or positions. The OSM has retrained 
many employees to improve their effectiveness in program delivery. Some 
staff were relocated to match technical expertise with workload 
demands. With training, redistribution of workloads, automation, and 
redesign of some of OSM's processes, OSM has employees located in the 
most efficient locations and has virtually completed its organizational 
realignment. The OSM will continually monitor its workload and adjust 
staffing locations as needed.
                                remining
    The OSM has established a charter which involves the formation of 
partnerships with States and environmental groups to determine the 
status of remining in the Appalachian States.
    Question. What levels of production can be expected through 
remining projects?
    Answer. The OSM is unaware of any projections regarding total 
potential coal production from remining projects. However, in 
Pennsylvania, 60 percent of the active coal mining operations involve 
remining, as did 72 percent of the active operations in Virginia in 
1994. Furthermore, in Virginia in 1994, 38 percent of the total 
permitted acreage consisted of previously mined lands.
    Question. Will remining efforts affect sites that have been 
restored through reclamation projects? Have any sites over the past 
five years been reclaimed and then remined? Was the reclamation expense 
for any of these sites paid for with AML funds? If so, what has the 
cost been to the AML fund?
    Answer. We do not anticipate that areas already reclaimed through 
the AML program will be disturbed through remining efforts. The OSM is 
not aware of any reclamation work funded from the AML program that has 
been disturbed by remining. Our national program guidelines are quite 
specific regarding areas that have potential for remining. Such areas 
are not to be reclaimed through the AML program unless the reclamation 
authority can ascertain that there is little likelihood of a remining 
effort. Programs go to great lengths to ensure that remining does not 
occur on areas that have been reclaimed with AML funds. In some States, 
the landowner or mineral owner must complete a questionnaire which 
discusses any future plans to remine. If such plans are even remote, 
the AML program does not undertake a project. Also, the AML program 
discusses the site with the regulatory program and gets input as to the 
suitability for remining. Again, if the site is even slightly a 
candidate for remining, funds are not used for the portion of the site 
that might be remined.
                state funding, environmental protection
    The agency is planning a $500,000 decrease in the State Funding 
Program.
    Question. Which States will be affected by this reduction?
    Answer. The OSM anticipates this reduction, of less than one 
percent of the total grant funds, will have no discernible impact on 
States. It has been determined that States are not fully obligating 
grant funds, as evidenced by some States consistently turning back 
funds at the end of the grant performance period; over $1 million was 
deobligated in fiscal year 1995, the latest year for which we have 
complete data.
    Question. Are these reductions due to reduced matching funds by the 
States? If so, why have the matching funds been reduced? Is there less 
work to be accomplished?
    Answer. This reduction is due to a reduced matching level by the 
States. The reasons for the reduction in State matching funds are 
numerous and can vary from State to State and from year to year. 
However, the most consistent reason is, like the Federal Government, 
many States are facing a financial challenge and are forced to make 
tough choices for dwindling or flat resources.
    Question. What was the fiscal year 1998 grant request total on a 
State by State basis?
    Answer. The following table shows the States' fiscal year 1998 
grant estimates, which were submitted to OSM in August 1996.

                           FISCAL YEAR 1998 REGULATORY GRANT ESTIMATES STATES' REQUEST                          
                                               [In whole dollars]                                               
----------------------------------------------------------------------------------------------------------------
                                                                    Non-Federal                                 
                              State                               lands (Federal   Federal lands       Total    
                                                                      shares)                                   
----------------------------------------------------------------------------------------------------------------
Alabama.........................................................       1,203,815          15,000       1,218,815
Alaska..........................................................         173,580  ..............         173,580
Arkansas........................................................         196,836  ..............         196,836
Colorado........................................................         510,227       1,409,199       1,919,426
Illinois........................................................       2,239,046          87,486       2,326,532
Indiana.........................................................       2,161,827  ..............       2,161,827
Iowa............................................................         180,570  ..............         180,570
Kansas..........................................................         104,166  ..............         104,166
Kentucky........................................................      13,760,504         359,285      14,119,789
Louisiana.......................................................         192,563  ..............         192,563
Maryland........................................................         663,173  ..............         663,173
Mississippi\1\..................................................  ..............  ..............  ..............
Missouri........................................................         573,166  ..............         573,166
Montana.........................................................         266,444         840,965       1,107,409
New Mexico......................................................         278,586         398,526         677,112
North Dakota....................................................         296,628         230,711         527,339
Ohio............................................................       1,551,254  ..............       1,551,254
Oklahoma........................................................         899,374          24,030         923,404
Pennsylvania....................................................      12,023,329  ..............      12,023,329
Texas...........................................................       1,446,563  ..............       1,446,563
Utah............................................................         280,028       1,398,181       1,678,209
Virginia........................................................       3,063,965          10,518       3,074,483
West Virginia...................................................       8,142,287  ..............       8,142,287
Wyoming.........................................................         262,250       1,271,732       1,533,982
                                                                 -----------------------------------------------
      Totals....................................................      50,470,181       6,045,633      56,515,814
----------------------------------------------------------------------------------------------------------------
\1\ Has not yet submitted estimates for fiscal year 1998.                                                       

    The Interstate Mining Compact Commission recommends reducing the 
State ``matching'' share to 25 percent from 50 percent.
    Question. How would such a change affect the operations of OSM in 
terms of program accomplishment, FTEs, and project backlog?
    Answer. If the State matching share is reduced to 25 percent and 
the overall grant appropriation of $50.7 million is increased 
proportionally within OSM's budget , such a change would severely 
impact all of OSM. The OSM would have to reduce its direct operating 
budget from $55 million to $32 million. The OSM operating budget could 
not be lowered to this level without severely impacting the agency's 
mission. Such a reduction would adversely affect not only coal field 
residents in Federal program States who are completely dependent on OSM 
for protection from coal-related hazards, but also primacy States who 
rely on OSM technical assistance and training, and who also benefit 
from OSM oversight and backup enforcement. At this time, the precise 
impact of such a decrease on OSM's programs, FTEs, and project backlog 
cannot be quantified.

                                     ENVIRONMENTAL PROTECTION: STATE FUNDING                                    
                                            [In millions of dollars]                                            
----------------------------------------------------------------------------------------------------------------
                Current funding                                       Hypothetical funding                      
----------------------------------------------------------------------------------------------------------------
Non-Federal lands cost (50 percent)...........     $45.324     Non-Federal lands cost (75 percent).     $67.986 
Federal lands cost............................       5.352     Federal lands cost..................       5.352 
State match (50 percent)......................      45.324     State match (25 percent)............      22.662 
                                               -------------                                        ------------
    Total program cost........................      96.000         Total program cost..............      96.000 
Grant appropriation...........................      50.676     Grant appropriation.................      73.338 
----------------------------------------------------------------------------------------------------------------

    If the State matching share is reduced to 25 percent without 
increasing the overall grant appropriation, there would be an 
immediate, adverse impact on the States' regulatory programs. Under 
this scenario, State Regulatory Authorities' (SRA) budgets would be cut 
in half, as the OSM State Regulatory Grants would have to be reduced by 
one-half to comply with the SMCRA requirement that primacy States 
contribute 50 percent of the cost of the SRA's budget. A reduction of 
this magnitude would severely undermine States' ability to operate 
viable regulatory programs. Some States would not be able to maintain 
effective programs, in which case OSM would incur a major expense to 
take over the regulatory programs.

                                     ENVIRONMENTAL PROTECTION: STATE FUNDING                                    
                                            [In millions of dollars]                                            
----------------------------------------------------------------------------------------------------------------
                Current funding                                       Hypothetical funding                      
----------------------------------------------------------------------------------------------------------------
Non-Federal lands cost (50 percent)...........     $45.324     Non-Federal lands cost (75 percent).     $45.324 
Federal lands cost............................       5.352     Federal lands cost..................       5.352 
State match (50 percent)......................      45.324     State match (25 percent)............      15.108 
                                               -------------                                        ------------
    Total program cost........................      96.000         Total program cost..............      65.784 
Grant appropriation...........................      50.676     Grant appropriation.................      50.676 
----------------------------------------------------------------------------------------------------------------

    The agency appears to justify a reduction of $500,000 from the 
State regulatory grant program because States are unable to meet the 50 
percent match requirement. States appear to be having trouble meeting 
this 50 percent level.
    Question. Are there mechanisms in SMCRA which would allow OSM to 
increase the Federal share of the program? If changes to SMCRA are 
required, would the Department support the changes necessary to 
increase the Federal share? Has the agency analyzed what the financial 
impact would be to the Federal Government if States begin to opt out of 
regulatory programs? What steps is OSM taking to make sure that the 
State/Federal partnership remains in place?
    Answer. Section 705 of SMCRA provides that grants shall not exceed 
80 percent of the total costs incurred during the first year, 60 
percent the second year, and 50 percent each year thereafter. At this 
time, all States with active mining are at the 50 percent cost sharing 
level. However, if a State elects to regulate surface coal mining and 
reclamation operations on Federal lands, OSM may reimburse the State up 
to 100 percent of its costs of such regulation. For fiscal year 1998, 
we expect 11 States to have a cooperative agreement with OSM to 
regulate surface coal mining on Federal lands.
    There is no other mechanism in SMCRA to increase the Federal share 
of program costs. However, a State must have primacy to qualify for 
State Reclamation grants. Because of the impact a higher matching 
percentage could have on budget constraints, it is unlikely that the 
Administration would support any change to SMCRA which would result in 
such increased costs. The OSM has not analyzed the financial impacts if 
States begin to opt out of regulatory programs. At this time, we are 
not aware of any State planning to do so. One of the key steps OSM has 
taken to make sure the State/Federal partnership remains strong is the 
reengineering of the oversight process. In cooperation with the States, 
OSM developed a new results-based oversight strategy to focus on end 
results and the on-the-ground success of States in meeting the SMCRA 
environmental protection standards. Also, OSM and the States now 
develop State-specific evaluation plans tailored to the unique 
conditions of each State program and governed by performance agreements 
worked out by each State and OSM Field Office.
    The agency is planning a $240,000 increase in the State Program 
Evaluation. However, no FTE changes are shown.
    Question. For what purposes will this increase be used?
    Answer. This increase in Environmental Protection/State Program 
Evaluation is for a pro rata share of ``uncontrollable cost 
increases,'' which includes mandated pay increases.
                       applicant violator system
    A Federal appeals court in February 1997 ruled that the agency's 
Applicant Violator System (AVS) could not be used. On April 21, 1997, 
OSM announced new rules which would ``block permits for applicants 
responsible for uncorrected violations'' in the past.
    OSM Clarification and Response--In issuing its decision on January 
31, 1997 the U.S. Court of Appeals for the District of Columbia Circuit 
did not address or prohibit use of the AVS. Instead, it ruled that 
OSM's 1988 ownership and control rules exceeded the authority provided 
by Section 510(c) of SMCRA. Specifically, the court held that Section 
510(c) prohibits the issuance of a permit if there are unabated 
violations at operations owned or controlled by the applicant. This 
section does not, according to the court, authorize the regulatory 
authority to withhold permit issuance on the basis of unabated 
violations at operations owned or controlled by persons who own or 
control the applicant, as provided in the challenged regulations. The 
decision recognizes that OSM and State regulatory authorities have an 
obligation to implement Section 510(c) as interpreted by the court. The 
OSM and States use the AVS, which is a national database, as a tool to 
fulfill this obligation.
    Question. How do these new rules address the Federal judge's 
actions?
    Answer. The new interim final rules provide for application of the 
permit block sanction in a manner consistent with Section 510(c) of 
SMCRA as interpreted by the court. Under the new rules, regulatory 
authorities may not issue a permit if any surface coal mining and 
reclamation operation owned or controlled by the applicant is currently 
in violation. This differs from the previous rules, which extended the 
prohibition on permit issuance to situations in which any surface coal 
mining and reclamation operation owned or controlled by a person who 
owns or controls the applicant is currently in violation.
    Question. Can any existing information in the Applicant Violatior 
System be used to make administrative permitting decisions in light of 
the judge's decision?
    Answer. Yes. As required by regulations unaffected by the court's 
decision, State and Federal regulatory authorities continue to base 
permit issuance decisions on the compliance and ownership and control 
information in the AVS. While the court decision invalidated OSM's 1988 
ownership and control rules, it did not invalidate or otherwise negate 
the regulations requiring use of the AVS as part of the permitting 
process. The AVS and the information it contains are still essential to 
ensuring implementation of Section 510(c) of SMCRA.
    Question. What specific aspects of the new rules makes the process 
less susceptible to a repeat decision by a Federal court that this 
process can not be used to ``screen'' applicants?
    Answer. In rendering its decision, the court found that the 
language in Section 510(c) of SMCRA clearly authorized the use of the 
permit block sanction in those cases where the applicant owned or 
controlled violations. However, the court found that OSM had exceeded 
this authorization when it promulgated regulations that applied the 
permit block sanction to those who owned or controlled an applicant. On 
the basis of this single flaw in the rules, the court invalidated OSM's 
1988 ownership and control regulations. In developing the April 21, 
1997 interim final rules, OSM carefully considered the court's 
interpretation of Section 510(c) and sought to ensure that the new 
rules were fully consistent with that interpretation. Most 
significantly, the new rules do not include the provision that the 
court rejected. Hence, OSM believes that these rules will survive 
further judicial scrutiny.
    The agency states that there is a continuous violation problem, 
referring to 4,682 \2\ violations.
    Question. What are the past five year comparative data regarding 
violations notices? What is the disposition history for these 
violations?
    Answer. The following chart shows State individual violations for 
evaluation years 1993-1996. The 1992 data was captured at the aggregate 
notice of violation level, and a notice of violation may include more 
than one individual violation. Of the violation figures displayed, 
approximately 10 to 15 percent resulted in issuance of failure to abate 
cessation orders. The remainder of all violations were corrected to the 
satisfaction of the State regulatory authority.

1992...........................................................\1\ 9,178
1993..............................................................10,148
1994..............................................................10,493
1995.............................................................. 8,675
1996...........................................................\2\ 5,852

\1\ Data for 1992 is the total number of notices of violations, all 
other years are individual violations cited. A notice of violation may 
include multiple individual violations.
\2\ Preliminary numbers, the 4,682 figure above is for 9 months of data, 
the 5,852 is for 12 months of data.
---------------------------------------------------------------------------
             technical information processing system (tips)
    This system has become an integral part of State programs. The 
agency proposes a decrease of $300,000 in this program which is 
attributable to accomplishment of upgrades and equipment replacement. 
The Western Interstate Energy Board disputes the contention that 
equipment has been adequately upgraded.
    Question. Has OSM consulted with the States prior to making this 
budget request?
    Answer. The TIPS is a technical assistance program for States and 
Indian Tribes which is entirely Federally funded. States and Tribes do 
not match the costs. The OSM did not specifically consult with the 
States about any reductions in TIPS funding prior to making this budget 
request. Given other program priorities to be funded in fiscal year 
1998, the TIPS workstation upgrades were not included in the OSM budget 
request. The OSM has consulted with States to work toward developing an 
outline of the course of action and costs associated with maintaining 
TIPS at its current level of operation. It is intended that TIPS 
hardware will be replaced incrementally on a continuous five year 
rotating basis. Equipment replacement was initially envisioned as 
beginning in fiscal year 1996. However, due to budget reductions in 
fiscal year 1996, the replacement of equipment did not occur as 
anticipated.
    Question. Will this reduction make the agency increasingly prone to 
system obsolescence by lengthening overall equipment upgrade and 
replacement schedules?
    Answer. Some of the current TIPS workstations will be five years 
old in fiscal year 1998. This is a concern because the manufacturer's 
warranted maintenance and repair service agreement expires after five 
years from purchase. The OSM is replacing some of the older hardware 
this fiscal year and is striving toward a regularly scheduled cycle of 
replacement for all TIPS equipment. The OSM is not increasingly prone 
to system obsolescence due to replacement delays to date.
                          Departmental Offices
                       office of insular affairs
    The Committee last year directed the Department to withhold from 
American Samoa $2 million in construction grants until the Secretary 
certifies that the recommendation of the immediate term financial 
recovery plan have been substantially implemented.
    Question. Have these funds been released?
    Answer. No, these funds have not been released.
    Question. What progress is the American Samoa Government making 
with regard to implementation of the working group recommendations?
    Answer. We are awaiting a report from the American Samoa Government 
on the status of implementing the Financial Recovery Plan. We expected 
the report by May 31, but apparently it is not completed.
    Question. Would the Administration support inclusion of similar 
language in the fiscal year 1998 appropriations bill or report?
    Answer. Yes, we would support a similar withholding attached to the 
fiscal year 1998 appropriation.
    Similarly, the Committee has objected to the release of further 
funds for health care facilities pending establishment of an 
independent hospital authority with rate setting power.
    Question. What progress has been made in American Samoa with regard 
to establishment of an appropriate hospital authority?
    Answer. This issue was discussed with Governor Sunia in March. The 
Governor is strongly opposed to an independent hospital authority. On 
the premise that the primary Federal concerns are good hospital 
management and the imposition of a reasonable fee schedule, we invited 
the Governor to submit an alternative proposal that will accomplish the 
same objectives. He indicated he would do that and we expect his 
proposal at the same time as the report on the Financial Recovery Plan.
    Question. What funds have been released to American Samoa for 
health care facilities in fiscal year 1997?
    Answer. No funds have been released for health care facilities in 
fiscal year 1997. We will continue to withhold this funding until the 
American Samoa Government develops and implements a proposal for 
resolving health care problems that is acceptable to the Department and 
the Appropriations Committees.
    The American Samoa Government is to provide a capital improvement 
plan that shows what projects will be funded in the current budget year 
and four outyears.
    Question. Has the Department received an update of the Master Plan? 
If so, does the plan include any significant changes in priorities or 
funding requirements? If not, when does the Department expect to 
receive a plan update?
    Answer. The Office of Insular Affairs received revisions to the 
Master Plan from the American Samoa Government at the beginning of June 
1997. It included some changes in priorities, primarily associated with 
the Governor's desire to institute a program to improve village roads 
in American Samoa. The justification is that the village roads have so 
deteriorated that they are unsafe and basic services such as school 
buses, trash pickup, police, fire, and rescue cannot use many of the 
roads. We did not think the revised plan adequately demonstrated how 
priorities are determined and the criteria used to select specific 
projects. Also, although the transmittal letter referenced additional 
outyear information, specific lists of projects to be funded in fiscal 
year 2001 and fiscal year 2002 were not included. We are awaiting an 
improved plan and expect to receive it by mid-July.
                                  guam
    The fiscal year 1997 appropriations bill provided $4.6 million to 
Guam for capital infrastructure projects.
    Question. Has Guam provided the Department with a plan for 
allocating these funds and future funds that may be appropriated for 
this purpose?
    Answer. Yes, the Governor has given us a plan for the use of these 
funds. However, shortly after receiving the Governor's plan, we were 
informed that the Guam Legislature enacted legislation, over the 
Governor's veto, that directs all Interior funding be used for new 
school construction. We have asked the Governor to resolve any 
discrepancy and offered assistance in the development of a plan that 
focuses exclusively on new schools.
                         maintenance assistance
    The Administration is proposing a $980,000 increase in the 
maintenance assistance program to allow for a reduction in cost sharing 
for certain grants to island governments.
    Question. Given the level of Federal investment in capital projects 
in the insular areas and the importance of proper maintenance programs 
to maintain the value of that investment, does it make sense to reduce 
the local matching requirements for this purpose? Doesn't this send the 
wrong message?
    Answer. We think we can avoid sending the wrong message. Our major 
concern is that island hospitals simply are not participating in the 
program. While we want to develop incentives for participation by the 
hospitals, including waiving, delaying, or redefining matching 
requirements, we do not want that done at the expense of other 
participants. Given the huge investment made by the Department in 
island hospitals, we think the maintenance improvements are worth the 
proposed additional expenditure. We do not foresee any adverse impact 
from the proposal in terms of discouraging insular governments from 
investing in maintenance. The proposed incentives will be temporary and 
strictly limited to health care facilities.
                            brown tree snake
    The Administration is requesting a $1 million increase for the 
Brown Tree Snake (BTS) program.
    Question. For what specific purposes will these funds be used? For 
research? Control? Eradication? If funded at the request level, how 
would BTS funds be allocated between Guam, the State of Hawaii, the 
Biological Research Division and other program participants?
    Answer. Our major need is more research and $800,000 of the 
proposed increase will be used for that purpose. Research can involve 
both improved control techniques and eradication methods. The remaining 
$200,000 will go to the Commonwealth of the Northern Mariana Islands 
(CNMI), where a snake population appears to have developed, for control 
and containment efforts. The total $1.6 million budget will therefore 
be divided $200,000 each to Guam, Hawaii, and the CNMI for control 
operations, and $1 million to the Biological Research Division of USGS 
for enhanced research. All work funded and performed will be consistent 
with the Brown Tree Snake Control Plan, developed jointly by several 
Federal agencies and the aforementioned State and territorial 
governments.
                            enewetak support
    The Department is conducting a review of the Enewetak Support 
program.
    Question. Is this review complete? If so, what are the Department's 
findings? If not, when does the Department expect to complete its 
review?
    Answer. The review has not been completed. We are working with the 
U.S. Department of Agriculture to identify an expert to perform the 
review. We will use technical assistance funding to pay for the work. 
It now appears the work will not be completed prior to the end of this 
fiscal year.
                        departmental management
    The Department established the Franchise Fund Pilot Program which 
began in fiscal year 1997.
    Question. How has establishment of this fund affected Department 
efficiency?
    Answer. Establishment of the Franchise Fund Pilot Program has not, 
and was not expected to, initially affect the Department's efficiency 
either positively or negatively. However, over time through economies 
of scale and the ability to invest in new technology, the Department 
expects to realize benefits in efficiency of operations. No unnecessary 
layers of management, regulations, or other bureaucratic constraints 
have been imposed as a result of the pilot program. The current 
structure, building on pre-existing management structures including the 
Chief Financial Officer (CFO), the Deputy CFO, and the Administrative 
Services Advisory Board, oversees Interior service providers and 
establishes common policies and operating principles necessary to 
operate the Interior Franchise Fund.
    Question. Have internal Department administrative functions been 
affected adversely?
    Answer. Quite the contrary, the internal Department administrative 
functions have been impacted positively by the Franchise Fund Pilot 
Program. Revenues generated by the Interior Franchise Fund service 
providers result in funds for the acquisition of capital equipment for 
the improvement and implementation of Department financial management, 
ADP, and other support systems. Additionally, direct costs of the 
service providers such as labor and benefits are shared with Franchise 
clients instead of being borne entirely by the Department. Also, fees 
charged to non-Interior agencies are helping to offset certain fixed 
costs associated with the general purpose computer centers maintained 
by the Department.
    Question. What internal Department savings are attributable to 
establishment of this process?
    Answer. It is too early to quantify the savings related to the 
Interior Franchise Fund with any precision. Nonetheless, the labor, 
software, and computer center charges which are now being used to 
support external clients, which would otherwise have been borne by 
Interior bureaus, are estimated at nearly $2 million for fiscal year 
1997.
    The Department's budget justification discusses implementation of 
DOINET for 57,000 employees.
    Question. Does each bureau bear the cost of accessing the system?
    Answer. Yes, the bureaus pay for their costs of accessing the 
DOINET through the Departmental Working Capital Fund.
    Question. How are individual bureau costs computed for system 
access?
    Answer. The DOINET costs are allocated to bureaus based upon what 
they spend annually for non-DOINET data communications and on their 
actual DOINET measured usage. The costs of these two elements are 
weighted at 50 percent each and applied against projected DOINET 
expenses to determine a bureau's apportioned cost.
                        office of the solicitor
    The Office of Solicitor reports that it has provided significant 
assistance to ``basin wide'' watershed protection efforts. A specific 
example includes the Columbia River area.
    Question. As a result of these major basin wide assessment 
projects, is the agency devoting an increased level of resources to 
litigation and appeals?
    Answer. No, in the short term, the watershed protection efforts 
require additional legal support, but in the form of client counseling, 
reviewing documents for legal sufficiency, legal research, interagency 
coordination, and negotiations, rather than increased litigation or 
appeals.
    Question. Is litigation declining as a result of emphasis on basin 
wide areas?
    Answer. Certainly in the short term the answer is no. Existing 
litigation is not immediately resolved. Also, as watershed management 
efforts are initially undertaken, novel legal issues arise. Some of 
these are likely to be challenged. Over the next several years, we do 
anticipate a reduction in litigation, as issues related to the 
development of watershed management programs are resolved, and 
litigation over piecemeal management efforts declines.
    The Office has identified the lack of up-to-date computer 
technology as a serious problem.
    Question. What is the specific timetable for implementation of 
DOINET links to all Office employees?
    Answer. At this time, we do not have sufficient resources to 
establish DOINET links to all Office employees, given the high cost of 
the necessary hardware and software. Instead, we are proceeding 
incrementally, with our first goal being to establish a DOINET link to 
one computer in each of our six headquarters divisions and seven 
regional offices. Currently, DOINET connections have been made in all 
six divisions and in four regional offices, and we are making good 
progress in two additional regions.
    Where a regional office is in reasonable proximity to a client 
bureau, we have generally been able to extend their DOINET connections 
to our office. In other locations, it will be more difficult and costly 
for us to make the connections. We hope to complete these initial 
connections this calendar year. As resources permit thereafter, we will 
establish additional links with our 11 field offices and extend the 
existing links to additional workstations in each location. In order to 
do so, however, we will need to upgrade our workstations and purchase 
additional software to take advantage of the DOINET links.
    Question. What is the estimated timetable for implementation of the 
Office home page on the World Wide Web?
    Answer. We expect to have an Office of the Solicitor home page on 
the World Wide Web, with limited features, by the end of fiscal year 
1997.
    The Office reports a significant increase in litigation and 
counseling issues with a specific note regarding Equal Employment 
Opportunity (EEO) programs. The Department estimates that pending cases 
before the Equal Employment Opportunity Commission (EEOC) will be 
reduced by approximately 60. The Department also estimates that the 
number of new cases will continue to decline in fiscal year 1998 from 
its fiscal year 1996 levels.
    Question. What are the factors affecting this decline?
    Answer. As noted in the Departmental Management budget 
justification, policy guidance, training, and technical assistance have 
been provided to the bureaus to increase their effectiveness in 
resolving EEO allegations and complaints. The counseling program has 
resulted in the resolution of 79 percent of all pre-complaint 
allegations, and additional cases have been resolved through the use of 
alternative dispute resolution and settlement negotiations.
    A contributing factor in these successes may be the significant 
backlog of cases awaiting hearing at EEOC, which has resulted in fewer 
cases being scheduled for hearing in fiscal year 1997. This is likely 
to be only a temporary respite, as we are expecting EEOC to schedule a 
greater number of hearings in fiscal year 1998 to reduce its backlog. 
In the meantime, the EEOC backlog and attendant delays have influenced 
some complainants to opt for agency decisions without a hearing in 
order to obtain more expeditious consideration of their allegations.
    Question. What level of Office of the Solicitor involvement has 
assisted in the decline?
    Answer. The Solicitor's Office has been heavily involved in the 
efforts cited by the Department, including developing written guidance 
and providing training for managers and EEO officials. Some recent 
examples include our Office's active participation in development of 
the Department's zero tolerance policy on harassment and 
discrimination, and in EEO training for managers and EEO officials in 
Anchorage, Alaska; Rapid City, South Dakota; Albuquerque, New Mexico; 
and Denver, Colorado. We also have taken a proactive role in the 
development of effective diversity strategies and have provided 
extensive counseling in EEO matters. We believe these efforts have 
resulted in a better understanding of the EEO process and diversity 
issues by managers, and an increase in the effectiveness and 
professionalism of the bureau EEO staffs. This in turn has contributed 
to earlier resolution of complaints, as well as avoiding the filing of 
some complaints altogether.
    In addition, the Office is settling more cases prior to an EEOC 
hearing. The backlog in EEOC cases awaiting hearings has decreased our 
litigation work in fiscal year 1997, but it has substantially increased 
our work in providing legal review of the Department's decisions on 
complaints. There has been almost a 300 percent increase in our review 
of agency decisions over the comparable period last year.
    Question. What is the Solicitor's cost for processing these types 
of cases when settled informally, resolved formally, or heard by EEOC?
    Answer. We estimate that it costs our Office, on average, $170 to 
provide legal services in connection with a case settled at the 
informal stage (i.e., during EEO counseling); $2,280 for a case 
resolved at the formal stage (i.e., subsequent to the filing of a 
formal complaint but prior to an EEOC hearing); and $5,470 for a case 
heard by EEOC. Cases that proceed to an EEOC hearing are among the most 
labor-intensive and expensive in the Office, as our attorneys must 
provide a full range of litigation services without any assistance from 
the Department of Justice. The chart below shows the number of each 
type of case we expect to handle during fiscal year 1998, the average 
cost per case, and the total amount we expect to spend on these cases:

                                            COST OF PROCESSING CASES                                            
                                                 [Whole dollars]                                                
----------------------------------------------------------------------------------------------------------------
                                                                   Number of EEO     Estimated       Estimated  
                                                                     cases \1\     average cost     total cost  
----------------------------------------------------------------------------------------------------------------
Informal stage..................................................              50             170           8,500
Formal stage....................................................             135           2,280         307,800
EEOC hearing....................................................             200           5,470       1,094,000
                                                                 -----------------------------------------------
      Total.....................................................  ..............  ..............       1,410,300
----------------------------------------------------------------------------------------------------------------
\1\ Number expected in fiscal year 1998.                                                                        

                    Office of the Inspector General
    Question. The OIG's statistical results are displayed on pages 4 
and 5 of the OIG's budget justification. Please provide the 
Subcommittee with comparative data for these items for fiscal year 
1992-1996.
    Answer. The information is provided in the following table.

                                  OFFICE OF INSPECTOR GENERAL COMPARATIVE DATA                                  
----------------------------------------------------------------------------------------------------------------
                                                                   Fiscal year--                                
                                 -------------------------------------------------------------------------------
                                       1996            1995            1994            1993            1992     
----------------------------------------------------------------------------------------------------------------
AUDIT ACTIVITIES                                                                                                
                                                                                                                
Audit reports issuedor processed             912             960             869           1,194           1,003
Internal audits.................              64              60              82              85             102
Contract audits.................              45              97             124             160             155
Single audits...................             803             803             663             949             746
Indirect cost proposals                                                                                         
 negotiated.....................             350             425             471             436             408
                                                                                                                
IMPACT OF AUDIT ACTIVITIES--IN                                                                                  
 MILLIONS OF DOLLARS                                                                                            
                                                                                                                
Total monetary impact...........          $294.3          $278.3          $879.8        $1,321.2        $1,333.2
Questioned costs................           $16.3           $16.9           $47.9           $19.6           $15.5
Recommendations that funds be                                                                                   
 put to better use..............          $191.9           $97.3          $380.6          $631.2          $291.8
Lost or potential additional                                                                                    
 revenues.......................           $86.1          $164.1          $451.3          $670.4        $1,025.9
Internal audit recommendations                                                                                  
 made...........................             188             211             321             429             430
Internal audit recommendations                                                                                  
 resolved.......................             147             172             198             636             238
                                                                                                                
ADMINISTRATIVE ACTIONS TAKEN BY                                                                                 
 BUREAUS                                                                                                        
                                                                                                                
Matters referred for                                                                                            
 administrative action..........             144             181             166             225             234
Removals/resignations...........              15               7              15              18              15
Employee suspensions............              13               7              10              16               3
Number of days..................             284             101             330             319              40
Downgrades......................               2               1               4  ..............               2
Reassignments/transfers.........               5  ..............  ..............               3  ..............
Reprimands/counseling...........              28              15              15              13              22
Contractor suspensions..........               3  ..............  ..............  ..............  ..............
Contractor debarments...........  ..............  ..............  ..............               5              11
Other personnel action..........              12               1              18               3               3
Other procurement remedies......               2  ..............  ..............               1               2
Other administrative remedies...  ..............  ..............  ..............  ..............              28
General policy actions..........              40              30              20              20  ..............
                                                                                                                
INVESTIGATIVE ACTIVITIES                                                                                        
                                                                                                                
Total reports issued............             163             159             185             181             184
Cases closed....................             125             118             141             137             126
Cases opened....................             238              81              94             110             107
Cases pending...................             447             281             269             279             268
Hotline complaints received.....             226             432             484             471             397
Hotline referrals closed........             303             133             322             326             390
Hotline referrals pending.......             104             326             287             310             287
                                                                                                                
IMPACT OF INVESTIGATIVE                                                                                         
 ACTIVITIES                                                                                                     
                                                                                                                
Indictments/informations........              65              41              47              59              46
Convictions/pretrial diversions.              45              25              36              51              58
Sentencings.....................              37              41              40              52              60
Jail (months)...................           1,480             341             519             365             858
Probation (months)..............           1,992           1,536           1,890           1,796           1,700
Community service (hours).......           1,324           1,050           1,824           2,703           4,450
Cases referred for prosecution                                                                                  
 during year....................              81              57              76              83              72
Cases declined..................              31              15              33              33              19
Cases pending prosecutive                                                                                       
 action--end of year............             168             132             110             187              86
Administrative actions..........             118              61              82              79             100
Recoveries/restitutions--in                                                                                     
 millions of dollars............          $2.326          $1.810          $3.660          $3.449      \1\ $8.123
Civil judgments--in millions of                                                                                 
 dollars........................           $.003          $9.952           $.948           $.008          $1.501
Civil referrals.................              20               6               4               8               3
Civil declination...............               4               4               4               3               2
Civil judgments.................               1               3               3               1               2
----------------------------------------------------------------------------------------------------------------
\1\ Fiscal year 1992 recoveries were substantially higher due to a $6 million fine in one case.                 

    The statistics reported in the Semiannual Reports to the Congress 
for fiscal year 1992 to 1996 revealed that the total number of audit 
reports issued or processed during that time declined 10 percent, from 
1,003 in fiscal year 1992 to 912 in fiscal year 1996, including a 37 
percent decline in internal reports--from 102 to 64, and a 71 percent 
decline in contract audit reports--from 155 to 45. The major factors 
contributing to the decrease in the number of internal and contract 
audits were: (1) the Chief Financial Officers (CFO) Act of 1990 
requirement to audit the Department's financial statements--this 
resulted in an increase of 23 staff years devoted to CFO audits between 
1993 and 1996; (2) reductions in audit staff--the number of auditors 
and analysts decreased 18 percent, from 225 to 184, in fiscal year 1992 
to 1996 because of a lack of funds to replace auditors who retired or 
otherwise left OIG; and (3) OIG travel funds have been reduced because 
funds have been used, in part, to absorb increased costs of salaries, 
statutorily mandated availability pay for criminal investigators, and 
other uncontrollable costs which were not funded over the years.
    A more detailed discussion of these factors and how they have 
impacted audit operations follows.
    CFO Act Audits. To fulfill the requirements of the Chief Financial 
Officers Act of 1990, the OIG has devoted an increasing percentage of 
staff to CFO audits. For example, in fiscal year 1993, about 26 staff 
years (11 percent of available staff) were charged to the five CFO 
audits performed for that year. By fiscal year 1996, we had fully 
implemented the CFO Act and performed 15 CFO related audits, which 
increased the resources required for these audits to 49 staff years 
(about 27 percent of available staff). The combination of staff 
reductions and increased resources devoted to CFO audits has greatly 
reduced the staff available to accomplish audits of programs and 
operations that have historically resulted in a large monetary impact.
    While we are taking steps to reduce the resources necessary to 
conduct CFO audits, increasing requirements related to CFO audits make 
that difficult. These requirements include: (1) additional steps 
required by the Federal Financial Management Improvement Act of 1996; 
(2) the General Accounting Office's request that the OIG use its 
Financial Audit Manual as the primary audit guidance for accomplishing 
CFO audits; and (3) additional reviews required by new Federal 
Accounting Standards Advisory Board Statements including: Statement No. 
4, Managerial Cost Accounting Concepts and Standards, Statement No. 5, 
Accounting for Liabilities of the Federal Government, and Statement No. 
8, Supplemental Stewardship Reporting.
    The CFO audits have resulted in significant improvements in the 
financial management systems within the individual bureaus and thus in 
the Department as a whole. However, these positive results are not 
reflected in the statistics in the Semiannual Report.
    Reductions in Audit Staff and Travel Funds. The combination of 
staff reductions as a result of budgetary restraints and increased 
resources devoted to CFO audits has greatly reduced the staff available 
to accomplish audits of programs and operations that have historically 
resulted in a large monetary impact. As noted earlier, between fiscal 
year 1992 and 1996, the audit staff was reduced from 225 to 184 
employees. Included in this reduction is a decrease from 30 to 16 
auditors in the Virgin Islands and Guam audit offices.
    In addition, the travel funds available to perform audits declined 
about 71 percent from fiscal year 1992 to 1996, from $1.1 million to 
$326,135. Because Departmental offices are in about 2,000 locations 
(some very remote), the number of audits we can perform has been 
impacted by the reduction in travel funds. During our reviews in recent 
years, we frequently were unable to visit the number of locations 
required to enable us to project audit results. Instead, we reported 
the monetary impact only for the locations visited. The reduction in 
travel funds has also impacted our ability to perform Nationwide 
royalty-related audits involving major oil and gas leaseholders.
    The reduction in the travel budget has especially impacted our 
ability to perform audits in the insular areas, which include the 
Virgin Islands, American Samoa, Guam, the Commonwealth of the Northern 
Mariana Islands, the Republic of Palau, the Federated States of 
Micronesia, and the Republic of the Marshall Islands. The total travel 
budget of our audit offices performing these audits (located in Guam 
and the Virgin Islands) has decreased from $110,000 in fiscal year 1994 
to $62,500 in fiscal year 1996 despite increases in airfares, per diem 
rates, and other travel-related costs during that time. The travel 
costs in these areas are especially high because of their remote 
locations (where we do not have permanent staffs).
    Reduction in Contract Audits. From fiscal year 1992 to 1996, the 
number of contract audit reports decreased from 155 to 45. However, the 
number of contract audits performed from one year to the next is not 
exclusively under the control of the OIG. Contract audits are performed 
based on a request from either a contracting officer or a grant manager 
or upon notification that the Defense Contract Audit Agency is 
scheduling an audit of a Departmental contractor. The number of audits 
of cost proposals requested by contracting officers decreased from 53 
in fiscal year 1993 to two in fiscal year 1996. Also, the number of 
audits of costs incurred by contractors performed by the Defense 
Contract Audit Agency decreased from 33 in fiscal year 1993 to 18 in 
fiscal year 1996. In addition, the number of special audit reports 
decreased from 40 in fiscal year 1993 to 13 in fiscal year 1996. The 
majority of these reports are prepared by the Defense Contract Audit 
Agency and are audits of the internal controls of major defense 
contractors. Other factors contributing to the decrease were: 1) the 
elimination of direct funding ($350,000 in fiscal year 1993) for OIG 
requests for audits by the Defense Contract Audit Agency after fiscal 
year 1993; 2) the staffing requirements of the CFO audits that reduced 
the number of auditors available for the OIG to perform contract 
audits; and 3) the decrease in BOR major dam construction activity as a 
result of a change in its mission that resulted in fewer requests for 
audits and smaller contractor claims to review. The OIG reports had 
typically identified significant savings in the past for these kinds of 
audits.
    Reduction in Monetary Impact Because of CFO Requirements, Reduced 
Staff, and Reduced Travel Funds. The CFO staffing requirements, reduced 
staff, and reductions in travel funding have impacted our ability to 
conduct audits (including follow-up audits) in the following areas 
where, historically, we have issued audit reports with significant 
monetary impacts and recommendations to improve Departmental 
operations.
    Bureau of Reclamation Audits. In fiscal year 1993 and 1994, we 
issued two BOR audit reports which accounted for about $400 million, or 
18 percent, of the total monetary impact reported by the OIG during 
that time. Some of the recommendations in these reports are still in 
the implementation process. Factors discussed above have impacted our 
ability to conduct similar audits and follow-up audits of BOR to 
determine whether the recommendations are fully implemented as 
intended.
    National Park Service Audits. During fiscal year 1992 and 1993, the 
OIG performed audits with major monetary impacts in concessions 
management, recreation fees, and special use fees. For example, in 
fiscal year 1993, the OIG issued one report on recreation fee charges 
and collections that had a monetary impact of $229 million. As a result 
of these audits, significant changes were made to revenue collections 
in the national parks. These kinds of audits involve large staffs. 
However, factors discussed above have decreased the staff and travel 
funds available to perform similar audits.
    Minerals Management Service Audits. During 1992 and 1993, the OIG 
conducted several Federal oil and gas royalty audits that had a high 
monetary impact. For example, our review of gas contract settlements in 
1992 resulted in recommendations that had a potential monetary impact 
of $754 million, and a review of offshore oil and gas leasing in 1993 
resulted in increased revenues to the Government of about $181 million. 
Factors discussed above have impacted our ability to conduct similar 
audits of MMS and follow-up audits to determine whether the 
recommendations were fully implemented as intended.
    Conclusion. While the number of audit reports and the monetary 
impact of the OIG program have decreased, we continue to evaluate our 
operations and to initiate new and innovative approaches to optimize 
the use of our resources to provide value and assistance to the 
Congress, the Administration, Departmental managers, and the taxpayers 
in building a Government that ``works better and costs less.'' The 
value of assisting in the identification and implementation of 
improvements in programs and operations cannot always be easily 
measured in dollars and cents. For example, over the past couple of 
years, we have attempted to be increasingly responsive to requests from 
the Congress and Departmental managers for our audit services. The 
audits and audit assistance we provided in this regard have resulted in 
substantial improvements in the programs and operations of the 
Department of the Interior.
           Office of the Special Trustee for American Indians
    Secretary Babbitt, we have been dealing with the difficult issues 
of the United States trust responsibility since the establishment of 
the relationship with Natives. In relatively recent years, say within 
the last decade, Congress has tried to tackle the task of reconciling 
Native land title records, Native land and natural resource management, 
and trust fund management. The United States has a trust responsibility 
in regard to the management of 40 million acres of tribal land and 10 
million acres of land owned by individual Indians, for which legal 
title is held by the United States. As trustee, the Government is 
responsible for managing the assets, collecting the income from them, 
and investing and disbursing the money collected. Congress has assigned 
management to you, the Secretary of the Interior.
    Congress created the Office of the Special Trustee (OST) in the 
Indian Trust Fund Management Reform Act of 1994. We did this in 
response to evidence that the Interior Department has failed to meet 
the basic obligations of a trustee.
    In 1996, the Office of Trust Funds Management and other trust 
services functions of the Bureau of Indian Affairs (BIA) were 
transferred to OST. As a result, OST now has the responsibility for 
trust moneys of Indian Tribes and individual Indians. Other trust 
functions, principally natural resource asset management activities, 
are still carried out by BIA, MMS, and BLM.
    The OST was directed by Congress to develop a Strategic Plan for 
trust management to ensure proper and efficient discharge of the 
Secretary's trust responsibilities.
    The Special Trustee submitted the Strategic Plan to you and to 
Congress in April--after the President submitted the Department's 
request for funding for the OST. I'd like to talk to you about the 
Department's formal request and the Special Trustee's plan.
    The President's Budget Request is for $39.337 million. This amounts 
to a $4.7 million increase related to program changes and $499 thousand 
in uncontrollable costs compared to the fiscal year 1997 enacted level 
of $34.1 million. The Budget Request includes $16 million for 
implementation of the Plan.
    Question. Will the Office move forward with the Special Trustee's 
Strategic Plan, which was submitted in response to Congressional 
mandate?
    Answer. The OST cannot move forward with its proposal to create a 
single organization to manage the U.S. Government's trust 
responsibilities to American Indians and American Indian Tribes for 
trust resource management, trust funds management and land title and 
records management (collectively, trust management activities). 
Implementation would require substantive changes in law.
    However, there are no legislative changes required for certain 
components of the plan, and some of these proposals are currently being 
implemented. For example, the Office of Trust Funds Management (OTFM) 
is continuing to make progress in an ongoing Individual Indian Money 
(IIM) data cleanup effort; elimination of land title and records 
backlogs will proceed in earnest if funding requested in the 1998 BIA 
budget for Land Records Improvements is approved by the Congress.
    In addition, acquisition of new systems should be able to proceed 
after a number of fundamental issues are addressed by the Special 
Trustee, including providing sufficient alternatives and benefit/cost 
analyses and preparing an adequate implementation plan. The proposed 
acquisition of a Trust Asset and Accounting Management System (TAAMS) 
will be reviewed pursuant to the requirements of the Information 
Management Technology Reform Act, (ITMRA) under the direction of the 
Department's new Chief Information Officer to ensure that the system 
meets these and other legislative requirements and is consistent with 
Administration policies.
    Question. What, specifically, will the OST accomplish in fiscal 
year 1998 with $39 million?
    Answer. The 1998 OST budget includes both ongoing operating funds, 
and funds for improvement efforts. About $20.6 million of the request 
supports on-going operations, and the remaining $18.7 million is for 
improvement initiatives.
    Operations.--Approximately $16.8 million of operations funding is 
allocated to OTFM and its area and field staff. These funds support the 
management of more than $2.5 billion in balances currently held in 
trust. Activity in the trust funds total more than $1.9 billion in 
receipts annually (including investment income) and $1.7 billion in 
disbursements. The 1998 funding for operations includes a modest 
increase of $0.2 million to fund the full cost of the annual lease 
trust system for tribal accounts; specifically, the funds will be used 
to support two sub-systems needed to comply with the Chief Financial 
Officers Act. Specific information on base operations is included in 
the Budget Justification as well as the fiscal year 1997 Semi-Annual 
Status Report submitted to the Subcommittee on June 19, 1997.
    Operations funding is also allocated to support ongoing settlement 
and litigation support. Specific information on base operations is 
included in the Budget Justification as well as the fiscal year 1997 
Semi-Annual Status Report submitted to the Subcommittee on June 19, 
1997. The 1998 request includes an additional $0.6 million required for 
the significant activities necessary to support the IIM litigation, as 
well as other litigation and settlement activities stemming from the 
tribal reconciliation project.
    A total of $1.7 million is requested under Executive Direction 
which supports the Immediate Office of Special Trustee, its advisory 
board, and the Intertribal Monitoring Association.
    Improvement initiatives.--A total of $16.8 million is requested 
under Strategic Plan-Systems; this amount is in addition to $13.4 
million appropriated in 1997 which largely remains available for 
obligation. Of the $30.1 million available for 1997 and requested for 
1998, the Special Trustee has proposed the following allocation to the 
various components of his Strategic Plan.

                                               STRATEGIC PLAN COST                                              
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                                                                                 Fiscal year--                  
                                                             ---------------------------------------------------
                                                               Strategic                                        
                                                               plan 1997-                            Total 1997-
                                                              98  request  1997 budget  1998 budget   98 budget 
                                                                                                                
----------------------------------------------------------------------------------------------------------------
I. Standard trust asset and accounting management system and                                                    
 land title and records management system...................       15,933        6,050        4,687       10,737
    A. Trust asset and accounting management system (TAAMS).        8,237        4,800        3,437        8,237
    B. Land titles and records management system (LTRMS)....        3,196  ...........  ...........  ...........
    C. General ledger system (GLS)..........................        2,000  ...........  ...........  ...........
    D. Interface development................................        2,500        1,250        1,250        2,500
                                                             ---------------------------------------------------
II. Information technology infrastructure...................       13,215        1,511  ...........        1,511
    A. AITDA, BIA, MMS, BLM.................................       10,458        1,158  ...........        1,158
    B. Tribes including end-user training...................        2,757          353  ...........          353
                                                             ---------------------------------------------------
      Subtotal systems costs................................       29,148        7,561        4,687       12,248
                                                             ===================================================
III. Data conversion, reconciliation and backlog clean-up...       27,535        2,000        4,000        6,000
    A. Probate Related Backlog clean-ups....................        6,000  ...........        1,000        1,000
        Agency..............................................        [600]  ...........  ...........  ...........
        Hearings and appeals/administration Law.............      [1,400]  ...........  ...........  ...........
        Land titles and records offices.....................      [4,000]  ...........      [1,000]      [1,000]
    B. File clean-up, data/document check...................        4,400        2,000        1,000        3,000
    C. IIM/Lease/subsystem conversion/reconciliation........        1,375  ...........        1,000        1,000
    D. LRIS conversion/owner reconciliation/defective title                                                     
     clean-up...............................................        2,600  ...........        1,000        1,000
    E. Imaging clean-up.....................................        3,160  ...........  ...........  ...........
    F. Appraisal clean-up and ongoing management............       10,000  ...........  ...........  ...........
                                                             ---------------------------------------------------
IV. Implementation..........................................       31,573        3,789        8,070       11,859
    A. Imaging..............................................        2,730          500  ...........          500
    B. Training AITDA, BIA, MMS, BLM........................        6,417  ...........        4,859        4,859
    C. Policy, procedure and legal manuals..................        4,000        2,000        1,000        3,000
    D. Risk management......................................        4,520  ...........  ...........  ...........
    E. Archives and records management......................       10,406  ...........  ...........  ...........
    F. External professional services.......................        3,500        1,289        2,211        3,500
V. Management...............................................        3,687  ...........  ...........  ...........
                                                             ---------------------------------------------------
      Total.................................................       91,943       13,350       16,757       30,107
----------------------------------------------------------------------------------------------------------------

    The Special Trustee's Strategic Plan is ambitious--and, I 
understand that you, the Administration, and OMB oppose it.
    Question. Why?
    Answer. The Department believes that the Special Trustee's 
Strategic Plan goes beyond the objectives of the American Indian Trust 
Fund Management Reform Act. This Act specifically states that the 
office was established to oversee and coordinate reforms of 
Departmental practices relating to the management and discharge of 
Indian trust responsibilities to ensure that reform of such practices 
in the Department are carried out in a unified manner. The Department 
does not believe the Act envisioned fully removing trust accounting and 
management functions from the Department.
    The plan recommends major investments to bring Indian trust asset 
management functions up to commercial trust standards, without 
providing sufficient alternatives and benefit/cost analyses to support 
the proposed level of investment. Such analyses are required by the 
Clinger-Cohen Act (ITMRA) and envisioned by the Trust Reform Act and 
its legislative history.
    The plan's usefulness to the Administration and Congress is limited 
because it only offers one model, the creation of a Government 
Sponsored Enterprise (GSE). Inherent in this proposal is the assumption 
that the Congress will be able, in these tight budgetary times, to 
adequately fund a stand alone GSE which would provide enhanced 
financial and banking services to 300 Tribes and 300,000 individual 
Indians. Such an assumption is unrealistic, given the numerous 
competing demands the Government faces to fulfill its current 
responsibilities.
    Additionally, given the Special Trustee's own assessment that BIA 
trust functions have been seriously underfunded and understaffed, the 
Administration questions the conclusion that BIA could not perform 
these functions if it was provided adequate resources--particularly if 
improvement efforts were overseen by a Special Trustee with budgetary 
control over improvement dollars, as proposed in the President's 1998 
Budget request. Indeed, a number of such improvements to trust funds 
management were implemented prior to the transfer of financial trust 
services to OST. While some reorganization of trust functions within 
BIA or the Department may be warranted, the Administration simply 
cannot support the separation and dissipation of the government-to-
government trust relationship that would result if this proposal were 
implemented.
    The Special Trustee has asked us to appropriate $80-$100 million 
for fiscal year 1998, compared to the Department's $39 million request. 
There is a gap of almost $50 million between the President's request 
and the Special Trustee's request, just through 1998. In addition, the 
Special Trustee states that an additional $76 million would be required 
in 1999; and between $56 million and $61 million would be required 
thereafter in on-going recurring costs for Phase I.
    In the first phase, the Special Trustee proposes the creation of an 
``American Indian Trust and Development Association'' (AITDA), a new 
independent government enterprise. Authority, responsibility, and 
funding of all Indian trust activities are proposed to be transferred 
to AITDA, including natural resource management and land records and 
title functions of BIA; inspection and enforcement of oil and gas 
leases on Indian lands by BLM; and royalty management of Indian leases 
of MMS.
    Phase I of the Strategic Plan is designed to bring the trust 
management and management information systems up to commercial 
standards within two years. The Special Trustee says he needs $80-$100 
million in each of the next two years to accomplish all of this.
    In total, implementation of the Special Trustee's recommendation 
for Phase I would mean transferring about $250 million from the budget 
of the Department of the Interior to the American Indian Trust 
Development Association.
    I understand that OMB, the Administration, and you, personally, 
oppose the Strategic Plan.
    Question. Do you support this part of the Special Trustee's plan?
    Answer. The Administration does not support transferring funding 
and responsibility for Indian trust management activities from the 
Department to the American Indian Trust and Development Administration, 
a new independent government enterprise.
    Question. Do you oppose it because it will cost too much to the 
Department, or do you disagree with the idea generally? What do you 
object to?
    Answer. The Administration does not simply oppose the plan because 
it costs too much. The plan recommends major investments to bring 
Indian trust asset management functions up to commercial trust 
standards, without providing sufficient alternatives and benefit/cost 
analyses to support the proposed level of investment. Such analyses are 
required by the ITMRA and envisioned by the Trust Reform Act and its 
legislative history.
    The Administration objects to the removal of Indian trust resource 
management functions from the Department and the broadening of the 
Department's investment responsibilities. Rather than expanding 
financial services to Tribes and individuals, we should be 
concentrating our efforts to improve the performance of our current 
responsibilities. Additionally, while there is general agreement about 
the need to replace or acquire new systems, the Administration has 
serious concerns about the level of analysis and implementation details 
supporting the systemic recommendations in the plan.
    Question. How much of your objection to the idea of moving all 
trust functions into a single agency relates to a fear of what the loss 
of $250 million of Interior Department funding would mean?
    Answer. None. However, the Department would object to 
redistributing this level of funding from other programs in the 
Department, or elsewhere from the Federal Government, given the current 
level of analysis prepared in support of the Special Trustee's 
recommended funding levels.
    I have heard that some Tribes have expressed concerns over this 
proposal, claiming that they do not think the Office of the Special 
Trustee will be able to manage these functions.
    Question. Have you heard from the Tribes on the idea of 
consolidating all trust management functions into a single agency? Do 
they support consolidation? Why or why not?
    Answer. The Special Trustee's Strategic Plan does not propose to 
move all trust functions to the Office of Special Trustee; rather the 
plan proposes a single organization, distinct from OST, to perform 
trust management activities, and would operate as follows, per the 
Strategic Plan:
    This will involve consolidating trust resource, trust funds and 
land ownership and records management processes into a single, 
independent institutional unit with its own management structure to 
accommodate the restructuring and reorganization contemplated by Phase 
I of the Strategic Plan. The unit should be organized by function and 
dedicated exclusively to trust management. The unit should be managed 
by a full time Chairman and a Board of Directors appointed by the 
President and confirmed by the Senate. The unit's proposed 
organizational form is as an independent GSE subject to Congressional 
oversight.
    A majority of the participants in the consultation hearings on the 
Special Trustee's draft Strategic Plan preferred that the management of 
natural resources remain with BIA and Self-Governance Tribes, rather 
than be transferred to AITDA as proposed in the draft Strategic Plan. 
The Special Trustee believes he has adopted this preference in the 
final Strategic Plan by proposing that resource management functions 
will continue to be performed by BIA, but will be subject to the 
oversight of AITDA. The AITDA will have authority and budget control 
(all funding is proposed to be appropriated under AITDA) over natural 
resource management and will out source such activities to BIA, which 
will act as a service bureau to the Trustee.
    The Tribal Consultation Report on the Draft Strategic Plan has been 
previously provided to the Subcommittee. The following letters are 
additional written comments received subsequent to the issuance of the 
Strategic Plan on both the draft plan and the final plan, for the 
Subcommittee files.
    [The letters follow:]
            Letter From the Council Annette Islands Reserve
                               Metlakatla Indian Community,
                                    Metlakatla, AK, March 24, 1997.
House of Representatives,
Interior Appropriations Subcommittee,
Washington, DC.
    Mr. Chairman: Our tribe recently received a copy of the draft 
``Strategic Plan to Implement the Reforms Required by the American 
Indian Trust Fund Management Reform Act of 1994''.
    While certain aspects of the Plan have merit, we are concerned that 
a majority of the Plan needs more careful study. The Special Trustee 
has recommended that trust management duties, responsibilities and 
activities, including Trust Resources Management, Trust Funds 
Management, and Land Title and Records Management be transferred to a 
new government sponsored organization outside the Department of the 
Interior. The proposed plan would fundamentally change the way American 
Indian trust activities are managed by the Federal Government and needs 
considerable review and examination.
    In its current form, the Plan does not provide sufficient 
information as to how the Plan is intended to address a range of key 
issues such as funding and accountability. In addition, it is not clear 
that the Plan would succeed in establishing a more effective trust 
management, nor is it clear that the Plan will protest the principles 
underlying federal trust responsibility.
    In that regard, we strongly urge restraint in any appropriations 
which would implement any portion of the proposal as it relates to 
removal of further functions from the Bureau of Indian Affair.
    We expect to continue our review and actively participate with 
other tribes in evaluating the Plan. As you know, plans for Indian 
Country of the past have not worked well when they don't have the full 
participation of the tribes in their development. We will expect to 
communicate further with your committee as the process moves forward.
            Sincerely,
                                          James E. Scudero,
                                                      Acting mayor.
                                 ______
                                 
                     Letter From the Klamath Tribes
                                        The Klamath Tribes,
                                     Chiloquin, OR, April 10, 1997.
Re Response to the OST strategic plan proposal.

Mr. Bruce Babbitt,
Secretary, Department of the Interior,
Washington, DC.
    Dear Secretary Babbitt: By this letter the Klamath Tribes will make 
known its position and opinions concerning the proposals being 
forwarded by the Office of Special Trustee (OST).
    The Klamath Tribes resolutely and steadfastly reject the 
recommendations being presented by the OST. We base our rejection upon 
the following:
  --1. The OST has not consulted properly with Tribes. The four 
        regional meetings conducted by OST do not and can never be 
        considered as consultation with the 535 tribes.
  --2. The answers to questions raised at the four meetings have not 
        been distributed to the tribes with sufficient time to review, 
        analyze and understand the answers. The questions posed were to 
        issues which cut to the heart of the federal/tribal 
        relationship.
  --3. The Tribes were not involved in the formulation of the charge to 
        the OST, nor involved in the development of the OST agenda.
  --4. The creation of a development bank may be a reasonable idea, but 
        the bank should not be used as a means to gain control of 
        Indian monies and land.
  --5. The recommendations of OST appear to define trust responsibility 
        to mean only trust as it applies to monetary accounts and land 
        issues, all other trust related responsibilities of the Federal 
        Government are dismissed as governmental responsibilities. This 
        redefinition of trust responsibility is tantamount to financial 
        and political termination of the tribes.
    Lest you believe the Klamath Tribes may not understand the issues 
or the implication of the recommendations of the OST, I would like to 
provide you with some information which will give you context for our 
Tribes' response.
    The Klamath Tribes has been intently following those issues which 
led to the formation or the OST. Like most people, the Klamath Tribes 
suspected there might have been mismanagement with the monetary 
accounts of tribes and individual Indians. But unlike most, the Klamath 
Tribes has had first hand experience with the federal government's 
mismanagement of tribal and individual tribal members financial and 
land affairs through that great injustice of the mid-fifties called 
termination.
    During the termination era Klamath's had their land and resources 
taken from their control and were forced to either accept a single cash 
payment or have your assets placed into a special trust administered by 
a bank.
    Some members chose the single cash payment and others had their 
assets placed in control of a bank. The emotional and spiritual scars 
of this arrangement notwithstanding, the assignment of tribal members 
assets to a special trustee led to a whole catalogue of abuses which 
the tribe was powerless to stop. The special trustee sold lands and 
assets and resisted any and all attempts by tribal members for an 
accounting of the assets and land sales. In addition the special 
trustee charged the tribal members accounts to support their brutal 
mismanagement of Indian assets and monies. Meanwhile, tribal members 
were literally forced to beg the special trustee for access to their 
own funds. And the Special Trustee could and did determine how much 
money and when a tribal member could access their funds.
    I can continue with a litany of other equally horrific tales of my 
people's experience with banks and Special Trustees, but suffice it to 
say the Klamath Tribes will not agree to the recommendations and will 
steadfastly resist any and all attempts by the Federal Government to 
implement the current OST recommendation.
    The Klamath Tribes would however, support a position whereby the 
Tribes can become an active participant in the crafting and development 
of recommendations on how best to address the issues of the 
fractionated lands, development banks and trust responsibilities and 
services required of, and provided by, the U.S. Government. If I can 
provide you with any additional information on this topic, please feel 
free to call upon me.
            Sincerely,
                                          Jeff C. Mitchell,
                                                   Tribal Chairman.
                                 ______
                                 
                Letter From the Tigua Indian Reservation
                          Tigua Indian Reservation,
                                     Ysleta Del Sur Pueblo,
                                       El Paso, TX, March 27, 1997.
Hon. Bruce Babbitt,
Secretary of the Interior,
Washington, DC.
    Dear Mr. Babbitt: Enclosed are comments from the Ysleta del Sur 
Pueblo regarding the Draft Strategic Plan Proposed by the Office of the 
Special Trustee for American Indians.
    Overall, the Pueblo is opposed to the plan since it appears to be 
in the best interest of big government. The Pueblo feels the plan 
focuses on creating another bureaucratic tier without any assurance of 
its success. Duplication of services is not the solution in our 
opinion.
    Should you have any additional requests, feel free to call us at 
(915) 859-7913.
            Sincerely,
                                             Vince Munoz, Governor.
    Attachment:
                                 ______
                                 
                        Ysleta del Sur Pueblo's
   comments on the draft strategy plan proposed by the office of the 
                  special trustee for american indians
Revampment yes. More bureaucracy, no.
    The Ysleta del Sur Pueblo agrees that there needs to be a 
revampment of the current trust funds management system, however, 
disagrees with the methods proposed by the Special Trustee. We support 
reform efforts that would strengthen regulatory standards and practices 
for the management and accounting of trust funds, as well as agree to 
the need for reconciliation and updating of land titles and records. We 
further support efforts to update and centralize record keeping 
systems, but creating an entirely separate bureaucratic tier in order 
to do this seems ludicrous. It seems to us that strong sanctions 
penalizing the mismanagement and misaccounting of trust funds would be 
a stronger message to send than just ``Let's start all over.'' We 
should alleviate the problem, not make it worse which is what we think 
is going to result from this new system.
Strategic plan poses questions as to whether a separate organization is 
        needed to handle trust mismanagement issues and carry out the 
        Government's trust responsibility.
    The plan suggests that the American Indian Trust and Development 
Administration (AITDA) will assume the legal trust responsibility while 
the BIA will continue to address areas of general trust responsibility 
and continue providing other services which have been scrutinized. If 
the plan is approved, the efforts of the Reorganization Task Force will 
prove to be futile. The entire goal of the Task Force is to diminish 
the BIA, however, this plan will only make it that much more difficult. 
What about funds to operate this new system? Where will they come from? 
Will the AITDA compete for the same limited financial resources? It 
seems hypocritical that the Special Trustee identified the competition 
for scarce financial resources as a reason for trust resource 
mismanagement, yet under this plan would be doing the exact same thing.
    Talk about starting big. There are five management sections with 43 
divisions for Phase I alone. This organizational set up is not 
justified. How much will it cost the tribes to fund the AITDA? This 
tribe would be interested to see a budget inclusive of start up costs 
and salaries being that they will most likely be commensurate to those 
in the private industry. The tribes will be affected by this proposal 
in one way or other, regardless of how much they say it will not.
Conclusion
    We stress the need for change within the current trust funds 
management system, however, are not convinced that the creation of a 
separate organization is justified, nor necessary.
                                 ______
                                 
   Letter From the Inter-Tribal Council, of the Five Civilized Tribes
                                                 February 28, 1997.
Hon. Hilda Manuel,
Deputy Commissioner of Indian Affairs,
Bureau of Indian Affairs,
Washington, DC.
    Dear Ms. Manual: The Choctaw Nation of Oklahoma is very concerned 
in regard to the proposed transfer of all trust management duties, 
responsibilities and activities carried out by the Bureau of Indian 
Affairs to newly created Government entity.
    I am requesting that Muskogee Area Director of the Bureau of Indian 
Affairs, Jim Fields, and the appropriate support staff attend a meeting 
scheduled for March 12, 1997, in Albuquerque, New Mexico to provide 
technical assistance to Muskogee Area Tribes at this meeting.
    A copy of the letter from special trustee Paul Homan is attached 
for your informal. Your consideration in this matter will be 
appreciated.
            Sincerely,
                           Chief Hollis E. Roberts,
                           President, Inter-Tribal Council,
                                         the Five Civilized Tribes.
                                 ______
                                 
                       Letter From the Kaw Nation
                                      Kaw City, OK, March 24, 1997.

Re Comments to the Consultations for the ``Draft Strategic Plan'' 
        proposed by the Special Trustee for American Indians.

Mr. Paul M. Homan,
Special Trustee for American Indians, U.S. Department of the Interior, 
        Office of Special Trustee for American Indians, Albuquerque, 
        NM.
    Dear Mr. Homan: The Kaw Nation recognizes and appreciates the hard 
work, commitment, and diligence you, your staff, and the Office of 
Trust Funds Management have demonstrated in the reconciliation and 
acknowledgement of the problems with the American Indian IIM and tribal 
trust funds. There are many more years (100's) of problems with the 
recording and management of Indian land, natural resources, and money. 
The very short period officially examined by the Office of the Special 
Trustee (OST) only exhibits a near term problem compounded by over 100 
years of poor records. Treaties, legislation, Court Decisions, 
agreements, etc. with Indians have not been thoroughly abided to by the 
Federal Government according to its Trust Responsibilities and 
Fiduciary Duties.
    The many problems in the management, documentation, accounting, and 
recording of Indian land transactions, management of Indian natural 
resources, continued due diligence in the reconciliation of past 
problems, and the management recording, and accounting of trust funds 
needs perpetual dedication, oversight, management, and reconciliation. 
The ``new (relatively) BIA'' is much different than the ``old BIA'' in 
that it is staffed with a majority of Indian people who are dedicated 
to tribal and Indian needs. However, the current employees of the 
Bureau are ``stuck'' with poor record-keeping, poor accounting, not 
enough funding/staff, and lack of separation of duties (Trust Functions 
vs. general trust responsibilities). They are building upon poor 
management/accounting and because of this poor base, they can only 
compound the situations and problems.
    The Kaw Nation, at the March 12, 1996 OST Strategic Plan 
Consultations, was represented by Walter I. Hare, Jr., Kaw Nation 
Administrative Services Director. In addition, the Kaw Nation has been 
in possession of the written ``draft'' Strategic Plan and the Special 
Trustee's Assessment, although only for a short period of time prior to 
the Consultations in Albuquerque.
    The Kaw Nation does not agree with the dismantling of the BIA and 
the removal of the Trust Functions from the Department of the Interior 
to any ``independent government sponsored entity.'' However the 
Strategic Plan's recommendation for a ``modern, up-to-date, and 
technology up-grading system'' is an intelligent and workable concept. 
For many years, as evidenced by the immediate past and the 
Reorganization Task Force, the Honorable Senator John McCain's Senate 
Bill to re-organize the BIA, the OST reconciliation efforts, and even 
the 1978 BIA Reorganization task force, attempts to address the many 
problems have been studied recommended, and continue to collect dust. A 
re-organization/re-structuring of the BIA is entirely possible using 
your ``technological modernizations, including constant up-grading'' 
and general organizational chart, only within the BIA and/or the DOI, 
if properly structured.
    The TDbank as an independent government sponsored entity (e.g. Farm 
Credit Bank) including life-line/full service banking, depository 
accounts, investment services, retirement accounts for tribes/Indians, 
some trust department services, etc., is credible and needed. The 
funding for start-up and operations, including subsidies, will be a 
problem that can be addressed in the near future. The Kaw Nation 
currently owns and 100 percent manages a small, but highly successful, 
Bingo Hall, a full service travel plaza, Kansa Travel Plaza on 
Interstate-35, that includes gasoline/diesel fuel, a convenience store, 
a restaurant, and a motel; two smokeshops; over 54,000 sq. ft (Kanza 
Greenhouses--14 greenhouses, warehouses and office/maintenance 
building) Greenhouse enterprise; a retail greenhouse within Ponca City 
city limits; a pharmacy; and is examining future business operations in 
Oklahoma and Kansas. In addition, the Kaw Nation is currently 
constructing and/or planning a Gymnasium/Community Multi-purpose 
facility, a wellness center that includes an indoor swimming pool, 
cardiovascular and physical therapy services, weight room and aerobics 
rooms, etc; a new clinic for rural health services, and a museum/social 
services building. The life-line banking services could greatly assist 
the Kaw Nation in the management of current resources and future 
Economic and Business Development activities.
    In addition, the Kaw Nation participates as a Self-Governance tribe 
in both the Department of the Interior's and the Indian Health Services 
Programs. The clinic, gymnasium/community multi-purpose center, and 
wellness center are located in Rural areas and will fulfill much needed 
rural health and recreational unmet needs. However, the maintenance and 
operations costs for the facilities will be expensive and the Kaw 
Nation is investigating assisted living for the elderly and additional 
services.
    If you have any questions, you may contact me or Walter I. Hare, 
Jr., Administrative Services Director, at the address and phone numbers 
listed on Kaw Nation letterhead. The fax number is (405) 269-2301.
            Respectfully,
                                               Wanda Stone,
                                               Chairperson and CEO.
    Question. Why do you think the Tribes oppose the idea? The BIA has 
done an awful job.
    Answer. The Tribes reasons for opposing consolidation of trust 
functions are varied and are outlined in the consultation report and 
the additional written comments provided to the Subcommittee.
    Question. Would you agree with the idea of consolidating trust 
management functions assuming that professionals in the areas of 
records management, natural resources management, and oil and gas 
leasing were hired into the agency?
    Answer. At this juncture, the Department does not support 
consolidation of trust management activities in the manner proposed by 
the Special Trustee. However, some consolidation may be desirable. Any 
proposal to consolidate trust management functions either within or 
outside the Department must be carefully evaluated against other 
organizational alternatives based upon a complete understanding of 
mission and underlying activities, core processes, and resources; be 
supported by a detailed implementation plan; and involve substantive 
tribal consultation.
    Question. Could Tribes continue to contract for these functions, as 
they do now from the various agencies? I don't see why they couldn't.
    Answer. Yes; the Strategic Plan proposed by the Special Trustee 
envisions that Tribes will continue to have the ability to contract or 
compact trust functions under the Self-Determination Act and Self-
Governance Act. Specifically, the Strategic Plan states:
    Like a private trustee, the proposed administration of the trust 
activities would rely on a common set of laws, policies, practices, 
regulations, and a common Trust Asset and Accounting Management System 
and a means through annual audits and reviews and administrative 
oversight and supervision to assure performance by the Self-Governance 
Tribes. The Self-Governance Tribes would act as service bureaus under 
delegated authority from AITDA to provide trust management services for 
which they had expertise. Thus, increasingly in the future, service 
bureau management of nearly all of the trust management activities 
could and should be provided by qualified Tribes or American Indians, 
themselves, under appropriate compacts and contracts, subject to the 
rules, oversight and supervision of the Federal trustee.
    The Special Trustee proposes that during Phase 2, the AITDA would 
transform into the American Indian Trust and Development Bank--a full 
service banking, trust, and financial service for individual Indians 
and Tribes. It would include a national headquarters building, a 
national archives and records center, and nationwide branch offices. 
The Federal Government would provide $500 million in equity 
contributions and $3 billion in direct long-term loans, and would be 
required to maintain permanent equity capital equal to five percent of 
assets.
    Question. Do you support this part of the plan? It is a purely 
financial function.
    Answer. The Administration does not support the establishment of a 
Federal American Indian Trust and Development Bank to fulfill the 
requirements of the American Indian Trust Fund Management Reform Act. 
However, full banking services are often not available in Indian 
Country, and the Administration has developed legislative proposals to 
address the absence of such services. In 1996, the Administration 
proposed the Native American Financial Services Organization Act to 
provide technical assistance to local lending institutions with the 
intention of overcoming barriers to housing and community development 
lending to help improve Native American housing and economic 
situations. Similar to the Administration's position on Phase 1 of the 
plan, the Administration would not support Phase 2 without a clear 
examination of alternatives and benefit/cost analyses.
    Question. Are you opposed to specific parts of the plan or to the 
entire plan? If you are opposed to only parts, which parts? Which parts 
would you support, and why?
    Answer. The Administration objects to the removal of Indian trust 
management functions from the Department and the broadening of the 
Department's investment responsibilities. Rather than expanding 
financial services to Tribes and individuals, we should be 
concentrating our efforts to improve the performance of our current 
responsibilities.
    There is agreement on the components of the plan relating to the 
clean up of the accounts and elimination of trust asset processing 
backlogs; however, the cost estimates to eliminate these backlogs are 
not fully substantiated and may be overestimated or underestimated. 
There is also general agreement to improve or replace systems; however, 
the Administration has serious concerns about the level of analysis and 
implementation details supporting the systemic recommendations in the 
plan.
    Question. If you, the President, and OMB oppose the Special 
Trustee's plan, what is happening over at OST right now? What do you 
propose for the Special Trustee? Is Congress spending money wastefully 
to continue to fund this office if the Administration will not support 
it?
    Answer. The Special Trustee has been requested to address a number 
of fundamental concerns regarding his proposal, including ensuring that 
the requirements of the Clinger-Cohen Act and OMB guidance on systems 
acquisitions are met; developing a realistic implementation plan; and 
coordinating with impacted Bureaus. The Administration supports 
effective implementation of the Office of Special Trustee as envisioned 
in the American Indian Trust Fund Management Reform Act. That is, an 
office that would ensure Indian trust reform efforts were coordinated. 
The funding requested in the President's Budget for the immediate 
Office of Special Trustee is necessary to perform the activities 
envisioned in the Act.
    In a press release commentary on the plan, Mr. Secretary, you were 
very critical of the plan's overall direction, saying it adds another 
layer of bureaucracy by creating a quasi-private, quasi-government 
agency to manage and administer trust funds. In the press release of 
your commentary you also express concerns that the plan seems to lack a 
fundamental understanding of the relationship between sovereign tribal 
governments and Federal trust responsibility.
    Question. What do you think the Federal trust responsibility 
entails? Where does it begin? Where does it end? Does it end?
    Answer. The United States unquestionably has a trust responsibility 
with respect to the administration of Indian trust funds and assets, 
and this responsibility carries with it the fiduciary duties attendant 
to a trust relationship. The Government's trust obligations arise 
whenever the United States exercises sufficient control over, or 
management of, trust property or trust money of Indian Tribes or 
individual Indians that the necessary elements of a common-law trust 
are present: a trustee (the United States), a beneficiary (the Tribe or 
individual Indian), and a trust corpus (timber, lands, funds, etc.). 
The trust responsibility does not extend to strictly commercial moneys 
that are the proceeds of Indian business enterprises, such as gaming 
revenues or revenues from tribally-owned firms.
    In general terms, the Supreme Court has described the trust 
responsibility as a moral obligation of the highest responsibility and 
trust. The more specific contours of the fiduciary relationship are 
defined by statutes, regulations, treaties, and executive orders. 
Congress has enacted a variety of statutes vesting the Secretary with 
the authority and responsibility to maximize returns from the 
management of individual Indian and tribal assets and investment of 
individual Indian and tribal trust funds, consistent with the specific 
requirements of the statutory provisions. There also are a number of 
other statutory provisions delimiting the Government's trust 
responsibility, including specific requirements for the disbursement, 
transfer, deposit, and investment of Indian tribal and individual trust 
funds, as well as related regulatory provisions.
    Courts also have relied on common law trust principles to 
supplement the various statutes and regulations in defining the United 
States' fiduciary obligations. Accordingly, the Government, like a 
private trustee, has a general obligation to exercise such care, 
diligence, and skill in managing and dealing with the trust property as 
a person of ordinary prudence would exercise in dealing with his or her 
own property. The United States must administer trust resources in the 
interest of the beneficiary, so that any profits gained through 
administration of the trust accrue to the beneficiary. The Government 
must promptly place trust income into interest-bearing accounts, and 
maximize trust income through prudent investment. The United States 
also has an obligation to make a full and proper accounting and to keep 
clear and accurate accounts.
    At the same time, courts also have recognized that the Government's 
trust obligation is unique and distinctive, in that Congress has 
required the Government to wear many hats and perform many functions, 
some of which may be in direct conflict. In this regard, the Government 
may not always be able to follow the fastidious standards of a private 
fiduciary, who would breach his duties to his single beneficiary solely 
by representing potentially conflicting interests without the 
beneficiary's consent. Consequently, all rules governing the 
relationship between private fiduciaries and their beneficiaries may 
not necessarily apply in every situation; rather, the precise scope of 
the fiduciary obligation of the United States must be determined in 
light of the relationship between the Government and the particular 
Tribe.
    In sum, the United States' trust responsibility with respect to the 
management and administration of individual Indian or tribal trust 
funds or property is best understood as comprising various statutory, 
regulatory, and other directives, as supplemented by common law 
principles applicable to trusts and trustees. Its application in each 
situation may differ depending on the context and particular 
authorities at issue, but may be guided by the Government's affirmative 
duty to ensure that tribal and individual Indian trust property and 
trust funds are protected, preserved and managed in a diligent and 
prudent manner, so as to produce a maximum return to the Tribes and 
individual Indian owners, within applicable statutory or other 
regulatory requirements.
    Specifically, the current investment authority for Indian trust 
funds is limited. Investments are limited to direct investments in U.S. 
Government securities (Treasury and other agency issues) and insured 
deposits or deposits collateralized by U.S. Government securities. The 
Special Trustee proposes a whole new range of trust management 
products, including savings deposits; voluntary tribal and IIM deposits 
from all sources, including gaming revenue; income from Federal 
taxation; and acceptance of retirement accounts.
    Question. Does the Federal trust responsibility go as far as the 
Special Trustee's plan proposes?
    Answer. No. The Federal trust responsibility does not require 
acceptance of voluntary deposits or provisions of the additional trust 
management products proposed by the Special Trustee.
    Question. Do you believe that the Federal Government's trust 
responsibility extends into ``private banking'' for Natives?
    Answer. No, however, the Administration is very supportive of 
efforts similar to the proposed Native American Financial Services Act 
to ensure that Native Americans are afforded banking services that most 
Americans take for granted.
    On previous occasions, you've expressed the view that the 
management of trust funds should be handled by a financially-oriented 
organization like Treasury or the Federal Reserve.
    Question. Why not support this plan, which proposes moving trust 
funds out of BIA? Wouldn't this be the solution you've been advocating?
    Answer. The Department's expertise is in natural resources 
management. The Department has felt that the purely financial 
management components of trust funds could be better handled by 
financially oriented organizations who deal with these issues on a day-
to-day basis as part of their core mission. The Department has never 
advocated movement of land management functions to a financial 
organization as the Special Trustee has recommended.
    Question. If you do not support the plan, why should the Committee 
provide the $16.7 million included in the President's Budget Request to 
implement the Strategic Plan?
    Answer. The Department believes there is general agreement about 
the need to acquire adequate systems, cleanup accounts, and eliminate 
processing backlogs, for which the $16.7 million is necessary. In 
brief, the current status of BIA/OST systems can be characterized as 
follows:
  --we have an inadequate IIM accounting system;
  --we have no overall accounts receivable/tickler systems;
  --we have no overall trust resource/asset management (including lease 
        management) system; and
  --improvements to land records systems are necessary to improve 
        efficiencies.
    The Department believes supporting systems (e.g., records 
management) also may require improvements. Additionally, current 
systems are not integrated, which creates inefficiencies. The lack of 
overall systems have necessitated that BIA Areas and Agencies develop 
their own local systems, which are sometimes manual. Such systems are 
difficult to audit on a comprehensive basis, and therefore we can not 
easily demonstrate proper management of our trust responsibilities. 
Current systems that meet BIA and OST needs appear to be available off-
the shelf (IIM, accounts receivable, and trust resource).
    Additionally, there is an urgent need to commence a thorough clean-
up of the probate backlog, the IIM and Tribal account files, the land 
and title records backlog, and the appraisals backlog. Delaying this 
necessary process will make it impossible for the Government to comply 
with the requirements of Section 101 of the Act for the foreseeable 
future exposing the Government to increasing liability. Because 
Interior does not have the internal financial and managerial resources 
to conduct the clean-up effort, this initiative should be out-sourced 
to independent contractors. The Strategic Plan contains an action plan 
for each of the clean-up reforms. The information and cost estimates in 
the plan were developed by the Office of Special Trustee and have not 
been verified. For example, the Land Titles and Records Offices (LTRO) 
and Office of Hearings and Appeals probate related backlogs may be 
overestimated; the agency probate backlogs may be underestimated.
    The President's Budget request was released before the Special 
Trustee published his Strategic Plan.
    Question. In light of the Special Trustee's proposal, does the 
Administration wish to amend its budget request for fiscal year 1998?
    Answer. No. At this juncture, the Department believes that the 1998 
President's Budget will be sufficient to implement agreed upon reform 
efforts.
    Question. Has the Special Trustee laid out alternatives for you to 
his plan? If you do not like his plan, what do you propose to address 
the problems, and can you do it within the President's request?
    Answer. The Special Trustee did not adequately lay out alternatives 
in his Strategic Plan, or present an adequate implementation plan. The 
Department has requested the Special Trustee to do so, and a response 
has recently been received and is under review. At this juncture, the 
Department believes that the 1998 budget request should be sufficient 
to perform implementable activities in 1998.
    In the press release I have seen of your comments, you also 
expressed the opinion that the plan requires large, new budget outlays.
    Question. Would you please elaborate on your concerns about the 
budget impact? If Congress decides that an independent agency is just 
what the doctor ordered, what accounts and programs do you recommend 
that we reduce to raise the additional $50 million or so for fiscal 
year 1998?
    Answer. The plan recommends major investments to bring Indian trust 
asset management functions up to commercial trust standards, without 
providing sufficient alternatives and benefit/cost analyses to support 
the proposed level of investment. The Department therefore would not 
support reducing any accounts anywhere in the Government to raise the 
additional funds the Special Trustee has proposed in his Strategic 
Plan.
    Mr. Secretary, we've only scratched the surface on this issue, 
today. Clearly, there is a great deal of concern over how or whether 
the Federal Government is meeting its trust function, in particular, 
the management of the trust funds. I don't think the budget 
justifications for the fiscal year 1998 budget for the Office of the 
Special Trustee sufficiently explains any strategy or plan.
    Question. If you and this Administration do not support the 
Strategic Plan of the Special Trustee, which this Administration chose 
for this job, when can we expect to see an alternative plan, and at 
what cost?
    Answer. The Department has requested the Special Trustee to lay out 
alternatives to his plan and prepare detailed implementation plans. A 
response has recently been received and is under review.
                   indian gaming proposed rulemaking
    Last year, the Department issued an advance notice of proposed rule 
making in response to the Seminole decision. As you know, this proposed 
rule making to establish procedures for Departmental authorization of 
Class III gaming raised strong objections by State governments and 
members in Congress.
    Question. Can you tell the Subcommittee the status of the 
Department's review of the advance notice of proposed rule making? The 
closing date for comments was July 1, 1996.
    Answer. Based in part on the comments received, the Solicitor has 
been carefully reviewing the question of whether the Department has the 
authority to issue regulations governing such gaming procedures. If the 
Solicitor concludes that the Department does have such authority, the 
Department will publish in the Federal Register a Notice of Proposed 
Rulemaking regarding Class III gaming procedures. We anticipate that 
the Solicitor will complete his review in the very near future.
    Question. Has the Solicitor made a final recommendation on the 
proposed rule making? If yes, what was the decision? If no, when do you 
expect the Solicitor to render a decision?
    Answer. No, as stated in preceding answer we anticipate that the 
Solicitor will complete his review in the very near future..
    I have learned that the Department plans to run the Solicitor's 
recommendation through the Justice Department before making a final 
decision.
    Question. Has this occurred? If not, can you give us an estimate on 
when you expect this report to be transmitted to Justice? If so, how 
long do you expect the Justice Department's review to take?
    Answer. No, although it is correct that the Department will consult 
with the Department of Justice prior to finalizing our review.
    Question. If the Solicitor and Justice determine you have the 
authority to permit Class III gaming to Tribes under the Indian Gaming 
Regulatory Act or some other Vehicle, do you expect to exercise this 
authority? Do you plan to consult Congress prior to doing so?
    Answer. If the Department decides to promulgate regulations 
governing procedures, it would do so in accordance with the 
requirements of the Administrative Procedure Act; all interested 
parties, including Congress, will have the opportunity to comment.
    Question. Has the Department or one of its subdivisions done any 
drafting of rules or procedures in the event the decision is in favor 
of Secretarial authority to permit Class III gaming? If so, the 
Subcommittee would like to receive a copy of any draft rules or 
procedures developed to date.
    Answer. Staff in BIA have drafted proposed rules which might be 
suitable in the event the Solicitor's Office determines that we do have 
the authority to promulgate such rules.
                          native land in trust
    A number of Indian Tribes are devoting significant portions of 
their budgets, including funds allocated to them by the Federal 
Government, to acquire additional land, and that is their right under 
the current law. Yet, the use of scarce resources for land acquisition 
necessarily limits the amount of funds that the Federal and tribal 
governments can jointly devote to programs that address the fundamental 
needs of Native American people (e.g., health care, education, and law 
enforcement). It also limits the amount of funds that can be spent to 
properly care for the lands already within their ownership.
    Question. Should we consider changes in policy or funding 
allocations in order to focus limited financial resources on the 
fundamental needs of Native American people?
    Answer. The Department does not believe policy changes are 
necessary because Tribes are not using BIA funds for land acquisition. 
As a matter of fact, BIA has not requested any appropriations for 
general acquisition of lands for Indian Tribes in the past 18 years.
    Furthermore, Indian Tribes are not devoting significant portions of 
their budgets to acquire additional land. As a matter of fact, for the 
period 1992 through 1995, the Secretary accepted title to only about 
215 thousand acres in trust for Indian Tribes.
    Question. Do you believe Tribes have a mutual obligation with the 
Federal Government to address the needs of their members?
    Answer. The Department agrees that Tribes have a mutual obligation 
to meet the needs of their members. The Department believes that the 
Tribes are doing this as evidenced by the high priority Tribes place on 
Tribal Priority Allocation programs.
    Tribal governments are actively involved in addressing the needs of 
their members. One of the most effective mechanisms available to tribal 
governments, in its effort to meet the fundamental needs of its 
members, is the acquisition of lands that are more suitable for 
economic development. Lands more suitable for development enables the 
tribal governments to establish economic enterprises that will generate 
the capital needed to more adequately address the fundamental needs of 
the tribal membership.
    The primary purpose of taking land into trust is most often to 
reacquire land lost under the General Allotment Act (between 1887 and 
1934, over 90 million acres passed out of Indian ownership under the 
allotment policies of the General Allotment Act); to provide tribal 
sovereignty; to provide land for Indian housing; and to allow Tribes a 
means of economic development.
    A Tribe's acquisition of land, and the Government's taking of land 
in trust are two different things. A Tribe can acquire land to reclaim 
its aboriginal homeland, or it can acquire land for speculation or 
economic development.
    Question. In deciding whether or not to take land in trust, does 
the Department consider the competitive advantages that accrue to 
tribal enterprises (i.e., with respect to tax and regulatory status)?
    Answer. Yes. When an acquisition is for economic development, the 
Secretary is required by regulation to take all State and local 
concerns into consideration as well as the following additional 
criteria: the existence of statutory authority for the acquisition; the 
need of the individual Indian or the Tribe for additional land; the 
purposes for which the land will be used; the anticipated economic 
benefits to the Tribe; the impact on the State and its political 
subdivisions resulting from the removal of the land from the tax rolls; 
and jurisdictional problems and potential conflicts of land use.
    Each acquisition application is evaluated on its own merits. The 
Secretary additionally considers: whether the State or local entities 
oppose removal from the tax rolls; whether there is factual conclusive 
documentation to support the opposition; whether the Tribe has made 
good faith attempts to mitigate any anticipated adverse impacts; 
whether the Tribe offered to offset the loss of the tax base by some 
other income source or benefit to the State or local government; and 
whether the offer was accepted, along with other factors.
    Question. In the past five years, how much land has been taken into 
trust for Indian Tribes that is not contiguous or located within that 
Tribe's reservation boundaries?
    Answer. The BIA does not maintain a breakdown of acres acquired and 
located on or off (not contiguous) to a Tribe's reservation boundaries. 
The BIA has made a special data collection effort for the time period 
1992 through 1996. At this time, data are available for the period 1992 
through 1995. For the period 1992 through 1995, the Secretary accepted 
title to approximately 215,000 acres in trust nationwide for Indian 
Tribes. The BIA is currently compiling the annual real property 
caseload and acreage report for 1996. This report will be completed by 
September 1997 and will be made available to the Committees at that 
time.
    Between 1887 and 1934, over 90 million acres passed out of Indian 
ownership under the allotment policies of the General Allotment Act.
    Last April, the Department changed its regulations to provide 30 
days notice to State and local governments for written comments on an 
application by a Tribe to have land taken in trust.
    Question. Since this regulation was implemented has the Department 
received more or less comments from State and local governments over 
the placement of lands in trust?
    Answer. The regulatory change in April, 1996 was not for the 
purpose of providing 30 days notice to State and local governments for 
written comments on a Tribal land acquisition application. The 30 day 
notice regulation has been in place since 1980.
    The regulation promulgated in April, 1996 provides additional 
procedures to ensure the opportunity for judicial review of decisions 
on trust acquisition. Since April, 1996, all interested parties have 
the right to file action in Federal court to prevent a trust 
acquisition if they disagree with the final administrative decision to 
take land into trust, giving all interested parties the opportunity to 
file lawsuits to overrule land acquisition decisions through the 
Federal courts.
    Since implementation of the new rule in April 1996, there has been 
an increase in the number of administrative appeals filed on decisions 
to approve applications to take land into trust status.
    According to the Code of Federal Regulations (25 CFR 151.11), the 
Secretary is required to consider, ``the impact on the State and its 
political subdivisions resulting from the removal of land from the tax 
rolls (and) jurisdictional problems and the potential conflicts of land 
use which may arise.''
    Question. How much consideration is given to this? What is given 
greater priority a Tribe's desire to have land place in trust or the 
concerns of the State or local government in which the land is located?
    Answer. The Department gives a great deal of consideration to this 
factor. Some of the items that the Secretary considers when weighing 
this factor are:
    1. Does the tax bill include any special district assessments, and 
if so, does the special district actually provide services/benefits to 
the property/landowner; or does the Tribe have an infrastructure plan 
to provide similar services to benefit the property?
    2. Will the Tribe be able to offset the loss of the tax base by 
some other income source or benefit the State or local government?
    3. Have the State or local entities submitted justifications for 
opposition to removal from the tax rolls?
    4. Will removing this property from the tax rolls impose severe 
economic distress on the non-Indian jurisdictions?
    5. Has the applicant made good faith attempts to mitigate any 
anticipated adverse impacts, and does the record demonstrate so?
    6. What are the anticipated economic benefits to the Tribe?
    7. What are the anticipated economic benefits to the local 
community?
    8. Does the use comply with local jurisdiction zoning laws? If not, 
is it compatible?
    The Federal Government enjoys a special relationship with Indian 
Tribes that is rooted in the U.S. Constitution. This relationship gives 
rise to certain rights and privileges that no other group of citizens 
is afforded such as self-determination and self-governance. The Federal 
Government is committed to promoting tribal self-determination, self-
sufficiency, and economic development. However, the Department does 
consider the interests of the State and local governments as well as 
local citizens in decision making about trust acquisitions.
    Question. In what circumstances will the Department place lands in 
trust for a Tribe despite concerns and/or objections by a State or 
local government or local citizens?
    Answer. Each trust acquisition application is unique and must be 
evaluated on its own merits. Decisions are based on an evaluation of 
the information submitted to support and justify the respective 
concerns by the applicant Tribe, State and local governments, and/or 
local citizens. It is not possible to state precise circumstances which 
would result in the Department placing lands in trust for a Tribe 
despite concerns by a state or local government or local citizens. It 
is fair to say that over the past three years, no lands have been taken 
into trust when there was strong opposition from state and/or local 
governments or citizens.
    Question. Approximately how often does this occur?
    Answer. Our experience shows that most local communities express 
little or no objection to tribal efforts to acquire lands located 
within the exterior boundaries of the Tribe's reservation for the 
improvement of the health and welfare of tribal members. The BIA field 
staff indicate that about 75 percent of all trust acquisitions are 
routine and non-controversial, as most local governments recognize the 
positive effects that will result from Indian trust acquisitions.
    The cases that appear to generate the most contentious positions 
and strong opposition are acquisitions proposed for gaming or similar 
large economic development projects.
    We would like to note for the record that a number of Tribes and 
States have negotiated, or are in the process of negotiating, state-
trial tax compacts that accommodate the needs and rights of each party. 
The Department facilitates this type of negotiation as it is the most 
favorable way to resolve the issues. In the negotiation process, both 
sides can discuss revenue needs, economic development objectives, and 
economic concerns.
    Where there is some controversy, many States and municipalities 
have been successful in negotiating agreements with Tribes such as the 
following examples reported by the National Conference of State 
Legislatures:
  --The Cherokee Nation has signed agreements with the State of 
        Oklahoma to make in lieu of tax payments to the state equal to 
        25 percent of all applicable excise tax on cigarettes.
  --The Fort Peck Tribes concluded a cigarette tax agreement with the 
        State of Montana.
  --The State of Louisiana and the Chitimacha Tribe entered into a tax 
        compact.
  --Nevada and the Reno Sparks Tribe have an agreement on Tribal excise 
        tax on tobacco products and a sales tax on retail sales on the 
        reservation.
  --The Warm Springs Confederated Tribes and the Oregon Department of 
        Revenue hold an agreement to share revenues generated by tribal 
        collection of state tax on cigarettes.
  --Four Tribes have entered into tax agreements with the State of 
        South Dakota on cigarette and tobacco tax.
  --New Mexico and the Pueblos of Santa Clara and Pojoaque have been 
        working on the development of a unified tax collection system 
        that will allow shared revenues.
    However, there have been a limited number of cases where some 
communities do not understand the unique status of Tribes and our 
government-to-government relationship. Local governments are concerned 
that continued expansion of tribal land bases will deprive the local 
governments of a significant tax base in the future and object to any 
proposed acquisition by a Tribe. The Federal Government's trust 
responsibility to Indian Tribes is to promote economic development, 
self-sufficiency, and self-determination pursuant to the 1975 Indian 
Self-Determination and Education Assistance Act, as amended. As 
previously stated, the United States has a special relationship with 
Indian Tribes that is rooted in the U.S. Constitution.
    I understand that new procedures implemented last year would 
require the Department to specify in its decision letter the proposed 
use of the property that is taken in trust if this information is 
known.
    Question. Does the Department include this information in its 30 
day notice to the States and local communities? If not, why?
    Answer. Yes. The Department's decision document requires an in-
depth analysis and evaluation of the Tribe's application for trust 
status. The decision document includes a summary of findings of fact 
supporting all statements and references that support the decision to 
approve or disapprove an application. One of the primary factors 
considered is the purpose for which the land will be used. The decision 
document is furnished to all interested parties to the decision.
    When land is taken in trust, it is removed from local tax rolls, 
depriving communities of badly needed revenues even though they will 
continue to be responsible for providing certain services to Native 
American communities.
    Question. Do you believe that Tribes should be responsible for 
maintaining lands on the tax rolls, even if they are placed in trust?
    Answer. No, the acceptance of title to land in trust status changes 
the character of title to the United States for the benefit of Indian 
Tribes. Requiring Tribes to continue to pay taxes on land held in trust 
status by the United States would be contradictory to the Federal 
Government's recognition of Indian Tribes as domestic dependent nations 
under the protection of the Federal Government. Federal lands generally 
are not subject to taxation. If this approach is taken, logic would 
imply that all lands where title is held by the United States should 
remain on the tax rolls. This would mean that all public (national 
forests, parks, wilderness areas, etc.) and reserved lands (military 
bases) should remain on the local tax rolls.
    Question. Or, alternatively, should Tribes be required to make in-
lieu-of-tax payments?
    Answer. No. Tribes in the exercise of their governmental authority 
are entering into agreements with the local governments for some type 
of compensation for in-lieu-of-taxes. These agreements are beneficial 
to both the local government and the Tribes. Requiring Tribes to make 
in-lieu-of-taxes would impinge upon tribal sovereignty.
    Question. Or, should the Federal Government be obligated to make 
local governments whole?
    Answer. Discussion with BIA staff indicate that about 75 percent of 
all trust acquisitions are routine and non-controversial. Among the 
cases where there is controversy, many States and Tribes are resolving 
their problems through negotiation of tax agreements. In addition, 
while the Payment in Lieu of Taxes program (PILT) compensates local 
governments for losses to their real property tax base for Federal 
lands within their boundaries, most of the PILT land holdings have been 
set aside for preservation and other purposes which place inherent 
limitations on economic development. Conversely, Indian trust 
acquisition usually results in increased economic benefits to the 
community as well as the reservation.
    Question. Do you know what affect the addition of that 
responsibility would have on the Federal Government's Payment in Lieu 
of Taxes program, which the Administration has proposed cutting by $13 
million for fiscal year 1998?
    Answer. The effects to individual units of local government from 
the addition of new trust lands to the PILT land base would not be 
significant. In 1996, the PILT entitlement land base was comprised of 
over 484 million acres.
                                 ______
                                 
             Questions Submitted by Senator Robert C. Byrd
                           budget priorities
    Mr. Secretary, many of the details of ``the budget deal'' will have 
to be hammered out through the appropriations process this summer. And 
while reports are that the overall domestic discretionary number will 
not be below the current level, and may actually increase, the specific 
602(b) allocations to the Subcommittees have not yet been made. So 
while I hope Chairman Stevens will look favorably upon the needs of the 
Interior Subcommittee, I also know that he will be under extraordinary 
pressure from all of the Subcommittee Chairmen--each of whom will be 
making the case as to why they should receive better treatment than the 
other Subcommittees.
    Regardless of the allocation this Subcommittee receives, it is 
unlikely that the budget as submitted will be approved without change 
by the Subcommittee. Thus, your task will be to work with us to address 
the most critical priorities. The President has proposed $527 million 
in increases above the comparable fiscal year 1997 levels for the 
programs in this bill. Of that amount, $389 million is for the agencies 
under your jurisdiction.
    Question. If additional resources are made available above the 
fiscal year 1997 level, but not to the full amounts requested for 
fiscal year 1998, what would you characterize as most critical of the 
increases that have been proposed in the budget?
    Answer. The Bipartisan Budget Agreement accepts the high priority 
that the President placed on his 1998 request for the Department. 
Discretionary spending in the Environment and Natural Resources 
Function (73 percent of the Department's budget) is specifically 
designated as a priority, as is spending for the Bureau of Indian 
Affairs' (BIA) Tribal Priority Allocations (10 percent of the budget). 
The Education Function, which includes the BIA education program (seven 
percent of the budget), is also designated a priority. The Department 
expects that these priorities will be reflected in the 602(b) 
allocation to the Subcommittee. However, the Department is prepared, as 
it has been in the past, to continue a dialogue with the Subcommittee 
concerning priorities once 602(b) allocations have been made.
    Question. How much of the proposed increase for your Department 
that is within this Subcommittee's jurisdiction is linked strictly to 
maintaining current levels of service and is not associated with new or 
enhanced programs?
    Answer. Almost all of the increases proposed for the Department 
cover increased costs of doing business or address backlogs of 
operational, maintenance or other needs. In the Fish and Wildlife 
Service (FWS) Resource Management account, for example, $9.9 million is 
sought to cover increased pay and other costs. Program increases of 
$9.7 million for the National Wildlife Refuge System address large 
backlogs of operational and maintenance needs identified in the new 
Refuge Management Information System. A program increase of $10 million 
for the Endangered Species program reflects a growing workload.
    Department-wide, fiscal year 1998 uncontrollable costs for Interior 
agencies under the Subcommittee's jurisdiction are estimated to total 
$114.0 million, including $21.5 million attributable to the 1.51 
percent increase in agency contributions to the Civil Service 
Retirement System agreed on in the Bipartisan Budget Agreement.
    Question. If the Subcommittee is held at a level that is roughly 
level with fiscal year 1997, what would you consider to be the highest 
priority issue that needs to be addressed of those proposed in the 
fiscal year 1998 budget request?
    Answer. The Bipartisan Budget Agreement accepts the priority that 
the President has placed on many of the Department's programs. The 
Department expects that the Subcommittee's 602(b) allocation will 
reflect the agreement on these priorities.
    Question. What will it mean to the Department of the Interior's 
presence in my State of West Virginia if the funding requested in 
fiscal year 1998 is not appropriated? Do you anticipate any changes in 
staffing, or office closures, or program terminations?
    Answer. Denial of the requested increases would not result in 
program terminations, but it would mean curtailment of services to the 
public. For example, Harpers Ferry National Historic Park would not 
receive $117,000 needed to maintain services and address increased 
requirements. Denial of increases requested for the National 
Conservation Training Center would prevent full operation of this 
important new facility in which the public has made a significant 
investment.
    It appears that one aspect of the budget deal may be a significant 
increase for land acquisition. Two of the largest pieces may be for the 
New World Mine, and for the Headwaters Forest. This still leaves nearly 
$400 million for additional land acquisition, if our understanding of 
the deal is accurate.
    Question. What capacity does the Department have to expand 
significantly its land acquisition program in fiscal year 1998 with 
current levels of staffing?
    Answer. The National Park Service (NPS) and FWS could not 
significantly expand their land acquisition programs in fiscal year 
1998 without proportionate increases in funding for acquisition 
management, appraisals, and transaction costs. Significant expansion of 
the land acquisition program will add workload associated with 
identifying, appraising, negotiating, closing cases, and surveying of 
tracts to be acquired. Some of this work can be accomplished through 
contracts with outside sources, such as appraisals and surveying. Other 
work can be accomplished through agreements with nongovernmental 
organizations that have historically assisted the Government with land 
acquisition. The nature of Federal land acquisition and the unique 
regulations and laws to which it is subject require a cadre of 
experienced realty professionals on staff to manage and review 
appraisals, to negotiate purchase agreements, to conduct title curative 
activities, and to control budgets and obligations of funds.
    The Bureau of Land Management (BLM), on the other hand, has some 
limited capacity to expand its land acquisition program in fiscal year 
1998 with current levels of staffing, particularly in those States 
which have received consistent Land and Water Conservation Fund 
appropriations over the past few years. Acquisition partners greatly 
enhance its ability to acquire property. These third party partners 
often concentrate on purchasing numerous small tracts, often 
inholdings, to convey to the BLM in one subsequent transaction. 
Opportunities for matching Federal funds with private sector moneys are 
among the BLM's highest acquisition priorities. By working with 
partners, BLM is able to make maximum use of its staff and has the 
ability to expand its acquisition program with its current staffing 
level.
    Question. What would be the operational requirements of adding new 
units to the Department's land base?
    Answer. The operational requirements resulting from additional land 
acquisitions vary among BLM, FWS, and NPS as follows:
    The BLM operational requirements would not significantly increase 
as a result of adding new units to the BLM land base. Most additions to 
the land base would be inholdings of private lands within areas BLM 
already manages. One of the objectives of the BLM land acquisition 
program is to increase public lands efficiency through the 
consolidation of public lands into manageable areas. In addition, BLM 
has focused on acquisitions that have minimal outyear costs associated 
with them. For those acquisitions that do require facilities or 
significant operations costs, BLM has used acquisition partners to 
leverage additional funding.
    The operational requirements of adding new FWS units will depend on 
the individual units under consideration. The FWS land acquisition 
program currently focuses on acquisition of lands at existing units of 
the National Wildlife Refuge System. The President's fiscal year 1998 
Budget does not request any funding for land acquisition that would 
establish new refuges. Moreover, of the 131 projects on the Land 
Acquisition Priority System list, only nine (or seven percent) are 
proposals for new units to the system. The FWS planning and budgeting 
for land acquisition emphasizes acquiring needed lands at existing 
units of the Refuge System.
    Each time a new unit is added to the National Park System, the 
operational responsibilities of NPS are necessarily increased. These 
costs are identified during the process which looks at the feasibility 
of establishing a new unit and the alternative methods of protecting 
the resource, should that resource be judged nationally significant. 
Each new unit brings with it varying degrees of new operational 
requirements. Before testifying in favor of new units, NPS carefully 
weighs this consideration, and for this reason, the Department of the 
Interior and the Congress have, in recent years, looked into new kinds 
of partnership arrangements such as heritage area designations, where 
the costs of operation and development are spread among several 
partners at the State, local and Federal level.
    Question. Aren't there already numerous units that are 
understaffed?
    Answer. While all NPS and FWS units may not have an optimum number 
of staff, the bureaus provide at least minimum services for the 
programs offered to the public at the various sites. To help mitigate 
this problem, both bureaus perform ``cluster management'' of units that 
are geographically close together.
    Question. Do you think the priority should be on adding new units 
before addressing adequately the needs at existing sites?
    Answer. The Department develops its position on potential new units 
depending on the merits of the resources in question. For instance, new 
units have been added to the National Park System at roughly the same 
pace for the last three decades; new units will undoubtedly continue to 
be added. It would be wrong to lose a nationally significant resource 
due to a policy forbidding new units. On the other hand, the documented 
NPS operational shortfall and infrastructure backlog has led both the 
Administration and the Congress to explore, when feasible, other 
alternatives to Federal ownership. In general, a mix of establishing 
new units when clearly appropriate, while providing additional 
financial resources for existing units, has proven a successful 
strategy.
    In the last two years, funding for the Interior bill is down about 
$1 billion, or approximately seven percent, from where it was in fiscal 
year 1995. The Interior Department has taken its fair share of these 
reductions.
    Question. How has the Department handled this reduction in its 
funding? How have personnel levels decreased, and what program changes 
have been implemented?
    Answer. Since January 1994, 10 of Interior's Bureaus and Offices 
have experienced reductions in staff of more than 10 percent. These 
reductions were made through aggressive use of buyouts, hiring freezes, 
and the separation of close to 2,000 employees through Reductions-in 
Force (RIF) in 1995 and 1996. The largest RIF occurred as a result of 
the legislated closure of the U.S. Bureau of Mines. Concurrent with 
these reductions the Department has undertaken a major streamlining and 
reinvention effort consistent with the President's Reinventing 
Government initiative. The Department has made significant progress in 
changing business practices and finding more cost-effective and 
efficient management strategies with a focus on partnerships and 
cooperative funding. Despite our best efforts at reinvention, however, 
the Department has suffered some program degradation. Indian Tribes 
have born much of the burden with a Congressionally imposed 11 percent 
reduction in fiscal year 1996 to Tribal Priority Allocations, the 
account which funds tribal governments, law enforcement, housing 
improvement, general assistance, and other reservation programs. While 
about a third of these funds were restored in fiscal year 1997, Tribes 
are still not able to maintain adequate services. For the land managing 
bureaus, the impact manifested itself in the curtailment of some 
services at parks and refuges and a growth in maintenance backlogs.
              National Conservation Training Center (NCTC)
    The fiscal year 1998 budget proposes an increase of $4 million for 
operations of the training center.
    Question. How will the proposed funds be used? Are they necessary 
because fiscal year 1998 will be the center's first full year of 
operations?
    Answer. The President's fiscal year 1998 Budget requests an 
additional $4.1 million to operate the NCTC at the level for which it 
was designed during the first year of operation. The additional funds 
are needed to annualize the fixed costs related to the operation of an 
adult residential training campus, such as utilities, maintenance, and 
security; increase the number of course offerings to 250; begin to 
implement distance learning programs; and continue the technical 
assistance and development of partnerships in conservation education.
    Question. If the full amount of funding requested in the budget is 
not appropriated, what consequence will this have on the Fish and 
Wildlife Service's ability to make use of this new facility?
    Answer. Any reduction to the funding level requested would impact 
the FWS ability to operate the NCTC. Training and education course 
offerings would be reduced, course development would be curtailed, 
distance learning programs deferred, and facility operations would be 
reduced.
    The fiscal year 1997 budget included funding of $500,000 each in 
the budgets of the National Park Service and the Bureau of Land 
Management in support of NCTC operations since these bureaus will also 
be users of the facility. Through direct and reprogramming actions, 
these funds were approved.
    Question. Is it your understanding that BLM and NPS funds provided 
in fiscal year 1997 are continued in the fiscal year 1998 budget? Are 
these funds considered to be a permanent part of the base?
    Answer. The fiscal year 1997 budget included funding of $500,000 
each in the budgets of NPS, FWS, and BLM in support of NCTC operations 
since these bureaus will also be users of the facility. These funds are 
part of the permanent base for NCTC operations into the future.
                 canaan valley national wildlife refuge
    This refuge, the Nation's 500th, was established in 1994--nearly 
three years ago. Yet it has taken several years to establish a 
presence.
    Question. How many refuges are staffed below the custodial level--a 
refuge manager, maintenance worker, and a biologist?
    Answer. There are 509 ``units'' in the National Wildlife Refuge 
(NWR) system. Of this total, 274 units are staffed and 235 are not 
staffed. (The majority of the 235 unstaffed units are satellites of 
small acreage which do not warrant staffing. Also, FWS has 
``clustered'' management activities at logical sites to oversee some of 
the far flung units of the refuge system, such as in North Dakota).
    According to a preliminary analysis, the system is staffed at the 
custodial level. For the job series in question, the following table 
displays refuge manning levels for the 274 staffed units:

                          REFUGE MANNING LEVELS                         
------------------------------------------------------------------------
               Job series                  Staffed sites      Percent   
------------------------------------------------------------------------
Refuge managers/wildlife administrators.             257              94
Biologists..............................             154              56
Maintenance/equipment operators.........             228              83
                                         ----------------               
      Total staffed units...............             274                
------------------------------------------------------------------------

    Question. What funding level would be necessary to bring all 
refuges currently in the system to this minimal level?
    Answer. The President's Budget request includes funding to address 
the highest priority operational needs of the NWR system. The budget 
includes a three-tiered effort to address the highest priority 
operational and maintenance needs of the Nation's 509 NWRs. First, 
operational increases total $13.8 million, or eight percent (including 
$4.1 million for pay and FERS retirement cost increases). Second, the 
budget continues the recreation fee demonstration program which will 
initially generate approximately $1 million for on-the-ground project 
work at the refuges which collect the user fees. Third, construction 
funding totaling $22.2 million will be used for the highest priority 
infrastructure backlog needs including the rehabilitation of roads, 
dams and bridges; as well as $17.1 million in ongoing operations 
funding for routine maintenance. The $17.1 million plus the $22.2 
million in the construction account will address the highest priority 
needs identified in the Maintenance Management System.
    The first increment of the operations increase is $9.8 million to 
protect wildlife, improve habitat, enhance recreation and education, 
and to accelerate comprehensive planning. The new Refuge Management 
Information System (RMIS) database was used to systematically rank 
priorities against nationwide goals to ensure project integrity and to 
compile a project list tied to the $9.8 million increase.
    The additional funding requested for habitat enhancement will be 
used to restore natural water flows and replant trees and prairie 
grasses. This funding will reverse the damaging effects of previous 
land uses which often include drainage, tree clearing, and elimination 
of native grasses. Restoring habitats now will ensure healthy and 
diverse ecosystems; ensure sustainable populations of fisheries and 
wildlife; and provide habitat for threatened and endangered (T&E) 
species. Implementation of wildlife dependent recreation and education 
projects will provide additional opportunities to the 29 million annual 
refuge visitors. Funding will also allow additional comprehensive 
management plans to be completed and guide future management of the 
refuge system.
    The second increment of the operations increase is $4.1 million to 
fully fund required pay and FERS retirement system costs for the 
approximately 2,800 employees of the refuge system. This ends the 
chronic hidden problem of eroded base funding which has been absorbed 
in recent years. For an average refuge, this could mean an additional 
$20,000 that won't be siphoned away from operations.
                      research/science at interior
    Mr. Secretary, you have been a staunch advocate of the need for 
independent science within the Department so that land management 
decisions can be made with the most accurate information possible. Your 
efforts in this regard, however, have been scrutinized by many, often 
out of concern about possible impacts on current management practices 
and uses.
    Question. Now that the Biological Resources Division (BRD) has been 
established within the U.S. Geological Survey (USGS), what is your 
assessment of the consolidation of biological science independent from 
the land managers?
    Answer. The integration of BRD into USGS is progressing positively. 
The BRD's top priority is to address Interior bureaus' needs. 
Continuing efforts over the next few budget cycles will demonstrate the 
ability to match up differing scientific disciplines in efforts that 
result in better protection of the Nation's natural resources and in 
providing reliable scientific information and management options 
supporting land management needs.
    As you are probably aware, Mr. Secretary, there are some who still 
advocate disbanding the consolidated approach and allowing each land 
management agency to continue to have its own research element.
    Question. What would be the consequences if the Congress were to 
consider breaking apart the BRD and reassigning the functions to the 
various bureaus of the Department?
    Answer. In recent years, the need for broader and more timely 
biological information has been apparent in the numerous controversies 
and potential economic dislocations surrounding various issues, e.g., 
endangered species. Consequences of breaking apart BRD would reduce the 
ability and effectiveness of the Department to address issues that are 
of common concern to the resource management bureaus, particularly 
issues that involve several geographic regions of the Nation. Each 
bureau would have to create costly duplicate science structures with 
overlapping services, activities, and functions to address the same 
need.
    For example, NPS, FWS, BLM, and other bureaus share a common 
concern about invasive species, noxious weeds, and exotic species. The 
BRD is in the best position to provide the scientific approach that can 
address those needs specific to each bureau and also simultaneously 
apply the broad perspective necessary to address the needs that extend 
across larger geographic areas. This broad perspective has been 
enhanced by the recent merger with the physical science divisions of 
USGS.
    An important aspect of ensuring the success of the consolidated 
research approach is to be ever vigilant to the needs identified by the 
land managers of NPS, FWS, and BLM.
    Question. How are you dealing with the concerns that continue to 
surface from within these agencies that they are not consulted 
adequately in determining how the BRD spends its money?
    Answer. It is the responsibility of USGS to meet the priority 
biological needs of the Department of the Interior. The BRD has worked 
hard at maintaining and fostering its working relations with the 
resource management bureaus. Improvements and changes in identifying 
Bureau Information Needs (BIN) are being pursued to ensure that the 
critical needs of the bureaus are communicated to BRD and that the 
science conducted by BRD is responsive to these needs. Other bureaus 
are fostering positions and plans that strengthen their link to BRD 
scientists. The FWS has established and filled a senior management 
position to coordinate identification of information needs within FWS. 
The BLM has formalized its strategic science planning process to 
systematically provide its science information needs directly into the 
BIN process in a timely manner. These actions have enhanced 
communication between BRD and other bureaus at all levels.
    One important aspect of the BIN process is reporting back to the 
bureaus on BRD responses to their information needs. The BLM recently 
received a report on the status of their information needs and on 
projects and activities underway in BRD to address them. The BRD 
Research Centers hold workshops and meetings with counterparts at the 
regional level to discuss progress in addressing the needs.
    Programs developed specifically for other Interior bureaus continue 
with substantive input from those agencies. For example, BRD has the 
primary responsibility for science issues for developing standards and 
protocols for Long-Term Prototype Monitoring in National Parks, but all 
reviews and decisions (including funding) are made cooperatively with 
NPS. The FWS is beginning to implement a systematic process to assess 
contaminant threats to refuge lands with their resources while BRD 
provides technical support and continues the development of guidance 
and data management tools for this effort. Other examples of BRD 
focused activities designed to meet specific information needs of the 
bureaus include: the Natural Resources Preservation Program which 
addresses needs of national parks; the quick response program which 
provides short-term information needs for FWS land managers; and 
offshore environmental studies which provide information for the 
Minerals Management Service use in offshore leasing and development 
decisions.
    The proposed increases for fiscal year 1998 reflect the priority 
needs of the bureaus identified through the formal BIN process, 
developed by a multi-bureau task force in fiscal year 1994 and 
initiated in fiscal year 1995. Based on the total resources available 
and the biological research capabilities of BRD scientists, the 
proposed fiscal year 1998 budget increases would address the highest 
priority biological information needs. The broad areas of research 
proposed for increases respond to bureau information needs (e.g., 
restoration ecology, invasive weeds). Because many resource problems 
are not confined to a single park, refuge, or BLM tract, USGS maximizes 
efficiency by focusing efforts on broad resource problems that 
transcend boundaries, and applying findings at the local level. Using 
this strategy and the BIN process to identify highest priority issues 
of the bureaus, USGS serves the needs of its Interior constituency.
    The fiscal year 1998 budget proposes an increase of $7.5 million 
for the BRD. These funds are proposed to be used for biological 
research and to improve long-term monitoring of biological resources.
    Mr. Secretary, a major focus of this Subcommittee has been to 
respond to the aspects of this appropriations bill which touch most 
directly the American people. Thus, the emphasis has tended to be on 
the resources necessary to provide for the visiting public--whether it 
be through the NPS, the Smithsonian, the Forest Service recreation 
program, or any of the other public aspects of the bill.
    Question. Given the demands to continue funding these public use 
programs, what do you see as the correlation between dollars spent on 
science and the experience the average American has when visiting a 
national park or national wildlife refuge?
    Answer. The mission of the Department to provide for the 
conservation and recreational use of the Nation's parks and wildlife 
refuges is enhanced when natural resource management decisions are 
based on objective scientific information. To this end, BRD conducts a 
full range of inventory, monitoring, and research from local needs 
affecting a single unit to large-scale issues affecting many resources. 
Results from these studies provide natural resource managers with the 
appropriate tools and information they need to deal with issues and 
problems associated with visitor use of the Nation's public lands. 
Thus, the experience of the average American visiting a national park 
or wildlife refuge is enhanced because potential conflicts over natural 
resource use are minimized and the continued health and sustainability 
of these areas is ensured for present and future generations. Examples 
of efforts by BRD include restoring the blackfooted ferret on the 
Charles M. Russell National Wildlife Refuge, evaluating the effects of 
mercury contamination in fish and wildlife on national parks and 
refuges in Maine and Florida, determining the distribution and the 
causes for decline of amphibians in North Cascades and Olympic National 
Parks, and modeling responses of the complex ecological processes of 
the Florida Everglades National Park to natural and human-induced 
changes to assist in the restoration of this park.
                           natural disasters
    The emergency supplemental approved by the Senate Appropriations 
Committee recommends a total of some $327 million in funding for your 
bureaus. A small portion of this is offset, but most is declared as 
emergency spending. While the single largest component is the funding 
to begin restoring Yosemite National Park, vast portions of the 
Department were affected by this winter's storms.
    Question. Based on the most recent estimates from the field, will 
the funds recommended in the supplemental address the most critical 
recovery needs?
    Answer. The funds recommended in the supplemental will address the 
most critical recovery needs of BLM, USGS, FWS, NPS, BIA, and the 
Bureau of Reclamation (BOR). In addition to the funding that it 
requested, BLM and NPS are also utilizing funding from the Federal 
Highway Administration, and therefore our ability to repair damage is 
also dependent on Federal Highway Administration's success in obtaining 
their requested funding.
    Question. Are there any major elements that you feel the Committee 
has not addressed?
    Answer. While we believe that all major elements were addressed by 
the Committees, USGS believes that additional elements warrant 
consideration. Non-emergency funds could be used by USGS to properly 
document the flood for purposes of improving risk estimates and 
improving forecasting capabilities for future floods. Large floods such 
as those that took place this year in the far western States, in the 
Ohio River Valley, and in the northern Great Plains provide information 
that is critical to the accurate assessment of risk, which is needed 
for design of future flood control works, for proper flood plain zoning 
and flood insurance rate mapping, and for improved calibration of the 
National Weather Service flood forecasting models. The physical 
evidence (e.g., high water marks) needed to make these improvements is 
highly perishable. If the field measurements are not made quickly, the 
evidence is destroyed by natural processes. If the USGS does not do 
these field investigations, the communities which have been devastated 
by recent floods will be no better prepared the next time significant 
flooding occurs.
    Question. What would be the impact on the Department of the 
Interior if there are delays in the supplemental being enacted?
    Answer. The 1997 Emergency Supplemental Appropriations and 
Rescissions Act (Public Law 105-18) has been enacted.
    Question. How will the Department address additional recovery 
requirements that might not become known until after action on the 
supplemental is completed?
    Answer. Our response cannot be determined in advance. If 
significant additional recovery requirements are made known to the 
Department, we will decide whether to request another supplemental, 
manage the requirements through the regular appropriations process, 
require the bureaus to absorb the cost of these additional actions 
within current funding levels, or forego the recovery actions.
    Question. Would you anticipate requesting further funds, or will 
the affected agencies have to address these requirements out of their 
base program?
    Answer. At this time, it does not appear that significant 
additional recovery requirements exist.
    Question. And if they have to absorb it out of the base, what 
effect does that have on other responsibilities?
    Answer. Should unknown significant recovery costs become known at 
this late period, the bureaus would have trouble absorbing new cost 
requirements in the last quarter of the fiscal year. Field offices in 
some bureaus would have to severely curtail significant mission-related 
field activities. However, we will keep the Committee informed of 
significant additional needs.
     full year continuing resolution provision in the supplemental
    Despite my efforts to have it stricken from the bill, the 
Supplemental contains a provision that serves as a full year continuing 
resolution for fiscal year 1998, but at the fiscal year 1997 funding 
level.
    Question. What would be the impact on the Interior Department if 
funding were frozen at the fiscal year 1997 level? What would be the 
consequence on the Department's programs if the proposed funding to pay 
for fixed costs is not forthcoming?
    Answer. The Department would have to absorb nearly $100 million in 
uncontrollable costs and forego increases critical to providing 
adequate funding for parks, refuges, public lands, Indian Tribes, and 
high priority ecosystems restorations. The most significant impact 
would be felt in infrastructure maintenance and repair, where 
historically inadequate funding has resulted in backlogs well in excess 
of $10 billion for the Department; and in the Bureau of Indian Affairs 
(BIA), where funding would be too low to address increasing school 
enrollment and deficiencies in funding for local reservation programs.
                  monuments in the washington, dc area
FDR Memorial
    Recently, the President dedicated the newest addition to the 
National Park Service's responsibilities in the monumental core with 
the official opening of the FDR Memorial.
    There has been considerable attention lately to the monument's 
components and the manner in which President Roosevelt's fight with 
polio is addressed.
    Question. What role would the Interior Department play in any 
decisions to modify the memorial? How would any modifications to the 
Monument be financed?
    Answer. Senate Joint Resolution 29 provides that the Secretary 
conduct a study and develop recommendations for an appropriate addition 
to the memorial depicting FDR's disability and to report to Congress 
upon completion of that study. It also provides that any addition be 
privately financed. The Department plans to use appropriated funds for 
salaries and administrative expenses associated with the study and 
private funds for design and construction.
    Question. What method will be used to select the designer for any 
addition to the memorial? Do you anticipate an open competition?
    Answer. This has not been determined. While it may be appropriate 
to utilize one or more of the original sculptors who participated in 
the memorial, a fresh start with an open selection process may be the 
better approach.
    Question. What timeline has the Department developed for planning, 
design, and construction of the addition to the FDR Memorial?
    Answer. If the experience with the Vietnam Memorial is 
representative, the Department believes that this process may take 
several years.
Korean War Veterans Memorial
    Recently, attention has been focused on the need for considerable 
repairs at the Korean War Veterans Memorial, even though this memorial 
is just a few years old.
    Question. Can you describe for the Committee the actions the 
Department and NPS are taking to address these repair needs?
    Answer. The work which has to be completed is related to the 
construction and design of the memorial. The NPS is meeting with the 
group which was authorized to construct the memorial, the American 
Battle Monuments Commission, to ascertain how the commission will fund 
work to complete the memorial.
    Question. What will happen if agreement cannot be reached with the 
contractor or other parties regarding funding for the repair?
    Answer. The American Battle Monuments Commission will have to seek 
a special appropriation, or as alternatives, it could reestablish the 
fund-raising campaign, or each branch of the armed services could 
contribute funds to the construction work.
    Question. What is the estimated cost to conduct the necessary 
repairs?
    Answer. The U.S. Army Corps of Engineers, the original construction 
manager for the Korean War Veterans Memorial project, has reported to 
the American Battle Monuments Commission the amount of $783,000 for the 
construction repair work.
    Question. What steps is NPS taking to ensure that responsibility 
for repairs is specified before monuments or memorials are turned over 
to the Service?
    Answer. The NPS is not always the contracting officer for the 
design or construction of a memorial. In these cases, the Park Service 
has no authority to effect changes in design, material, construction 
contract terms, or operational requirements. However, NPS has used 
Memoranda of Conveyance with the authorized group to address any 
continuing relationships and responsibilities between the Park Service 
and the group following completion of the memorial. The NPS has no 
authority to require the authorized group to retain funds to address 
latent design or construction issues.
    The Park Service does request that construction contracts contain 
extended warranty periods for major or unique components of the 
memorial. The NPS also requests all authorized memorial groups to work 
with the architect, sculpture, and design contractors to develop a 
manual of information which comprehensively details the memorial and 
its features, its operation needs, materials, and finishes. This manual 
of information is used as a management tool. Examples of these are 
manuals for the Vietnam Veterans Memorial and the National Law 
Enforcement Officers Memorial. The information is formatted to indicate 
guarantee periods, contractors, sculptures narrative, and design 
maintenance.
    Many groups, pleased to be at the end of the construction cycle, 
budget their remaining funds for dedication ceremonies and other public 
announcements of their achievement. They frequently do not retain the 
necessary funds to address latent design and construction issues nor to 
complete detailed operation and maintenance manuals to guide the NPS 
efforts.
    Future Congressional authorizations to construct memorials on park 
land could include requirements for the authorized group to establish 
contingency or retention funds to address unforeseen design or 
construction issues, similar to the process used in construction 
projects undertaken with appropriated funds. This requirement could be 
in addition to an endowment for future maintenance and operating needs.
                     office of surface mining (osm)
    A proposal has been developed for a cooperative research effort 
with the National Mine Land Reclamation Center to reduce formation of 
acid pollutants that can drain into streams and rivers where coal is 
mined. The objective is to pursue advances in technology to be used in 
the identification, evaluation, and development of methods that will be 
cost-effective and environmentally beneficial. The National Mine Land 
Reclamation Center can serve as a technical clearing house to identify 
and develop ``best science'' approaches to acid mine drainage related 
issues.
    Question. Do you agree that there is benefit in seeking to address 
acid mine drainage issues in a non-confrontational manner, apart from 
the regulatory environment?
    Answer. Yes. We believe that in order to make true progress in 
finding solutions for acid mine drainage problems, it is necessary to 
involve all parties--industry, States, academia, citizens, government 
agencies. This can be done best in a non-regulatory environment.
    Question. Has OSM participated with the National Mine Land 
Reclamation Center in devising this program to address the need to be 
able to predict acid mine drainage occurrence and develop successful 
prevention efforts?
    Answer. The OSM is participating extensively with the National Mine 
Land Reclamation Center (NMLRC). At OSM's request, with the agreement 
of the industry, the NMLRC serves as the Secretariat for the Acid 
Drainage Technology Initiative (ADTI). This initiative is a 
partnership-based joint venture, in which OSM has joined with industry, 
the States, academia, other governmental agencies, and other groups to 
identify science-based solutions to acid mine drainage problems. In 
addition, OSM, in conjunction with the Environmental Protection Agency 
(EPA), is providing funds to the NMLRC to: (1) organize a public 
meeting at the appropriate time to discuss the results of the ADTI 
prediction and prevention task groups efforts; and (2) assist in the 
technical review and development of acid mine drainage stream 
restoration projects.
    Question. Are other Federal agencies involved in acid mine drainage 
work? What activity have they had in working with OSM on this issue? 
How do you ensure that there is no duplication of effort?
    Answer. Many other Federal agencies are joining in the partnership 
effort to address acid mine drainage problems. The EPA is a major 
partner both in the Appalachian Clean Streams Initiative and in the 
Acid Drainage Technology Initiative. Other Federal agencies that are 
actively partnering with us and the States include: Natural Resources 
Conservation Service (NRCS), U.S. Army Corps of Engineers (COE), 
Tennessee Valley Authority, USGS, Forest Service, Department of Energy, 
BLM, and FWS. Some of these agencies (e.g., EPA, NRCS, COE) are 
participating in the Appalachian Clean Streams projects that are being 
funded this fiscal year. Some (e.g., Department of Energy, USGS, EPA) 
participate on the Acid Drainage Technology Initiative work groups. 
Duplication of effort is avoided by the extensive coordination that 
takes place between the agencies involved in acid mine drainage issues. 
For example, the Eastern Mine Drainage Federal Consortium, comprised of 
14 Federal agencies, meets regularly to discuss and coordinate issues 
relating to mine drainage. The work groups involved in the Acid 
Drainage Technology Initiative provide a coordinating mechanism for 
technical analysis. For the Appalachian Clean Streams Initiative, we 
conduct a conference call every two weeks to discuss progress and 
issues. Several Federal agencies (EPA, COE, NRCS) always participate in 
the conference calls.
    Question. What need is there to move from small-scale research to 
large-scale demonstrations of acid mine drainage abatement under 
operational conditions?
    Answer. There is a definite need to move in the direction of 
providing large-scale demonstrations of acid mine drainage abatement 
techniques under operational conditions. Our hope is that through a 
combination of Clean Streams projects funded through the Abandoned Mine 
Reclamation Fund grant appropriation and non-OSM contributions, and 
industry participation through the Acid Drainage Technology Initiative 
we will be able to field test techniques under actual operational 
conditions. That is one reason why we believe that continued funding 
for the Appalachian Clean Streams Initiative grants and OSM's technical 
assistance activities are important.
                  maintenance/infrastructure backlogs
    The maintenance backlog for the Interior Department is estimated to 
exceed $10 billion. The largest segments of this backlog are for NPS 
responsibilities and BIA. To assist in efforts to address demands 
placed on the public land agencies, Congress established a recreation 
fee demonstration program that allows agencies to retain funds 
collected on-site to address high priority requirements.
    Question. What has been the reaction of the public thus far to this 
program? Has there been any resistance to paying fees at sites 
participating in the program?
    Answer. The national and local press have been almost unilaterally 
supportive of the Recreational Fee Demonstration Program. Public 
response has thus far been positive. The NPS has, to date, received few 
letters regarding the program. The Park Service will continue to 
monitor the reaction to these new fees and to provide information that 
illustrates that they directly enhance the visiting public's 
experience.
    The NPS has already begun its evaluation of the Recreational Fee 
Demonstration Program by contracting with researchers from the 
University of Minnesota. A dozen case studies will be conducted to 
sample public opinion on the new fees.
    The first evaluation project has already been concluded at Colonial 
National Historical Park. This park raised the entrance fee for its 
Jamestown unit from $2 to $5 per person and instituted a new fee at the 
Yorktown unit at $4 per person. An admission fee for both units is $7 
per person and an annual family pass can be purchased for $20. 
Preliminary findings culled from the focus group meetings held there 
from May 30 through June 2, 1997 show:
  --Over three-fourths of those paying fees thought the fees were about 
        right, or too low;
  --Slightly less than one-fourth of the fee payers thought the fees 
        were too high;
  --Half of those gaining entrance using a Golden Age passport thought 
        the free entry provided by this pass to senior citizens was 
        right; and
  --Slightly less than half of the Golden Age pass users thought that 
        seniors should be charged at least something for entrance.
    Question. What is your current estimate of revenue that can be 
generated by this effort?
    Answer. Although the President's Budget had estimated that revenues 
generated by this effort in fiscal year 1998 would total $48 million, 
that estimate is now being revised as a result of amendments to the 
program earlier this year.
    Question. Can you provide examples of how the funds will be used?
    Answer. Several projects that are under consideration for the use 
of the funds include the rehabilitation of the Beaver Meadows Visitor 
Center, replacement of vault toilets, rehabilitation of trails and 
relocation of trailheads, and historic structure preservation at Rocky 
Mountain National Park. Others include improved public restrooms; 
improvement or provision of handicap access; utility system repairs at 
Yellowstone National Park; new toilets and dump stations; stabilizing 
the Widows Ledge ruin site; rehabilitating Wahweap picnic area; and 
stabilizing and rehabilitating five historic structures in the Lonely 
Dell at Glen Canyon National Recreation Area.
                                  fire
    Question. Please describe Departmental policy and any other 
Federal-level policy on the use and amount of ``prescribed burns'' and 
mechanical thinning on Federal lands to better manage accumulated fuel 
load.
    Answer. The Federal Wildland Fire Management Policy and Program 
Review Final Report dated December 18, 1995, establishes joint fire 
management policy for both the Department of the Interior and the 
Department of Agriculture. The role of wildland fire as an essential 
ecological process and natural change agent is prominently featured as 
one of the overall guiding principles for Federal fire management. 
Goals of the policy include the use of wildland fire to restore and 
maintain healthy ecosystems and to minimize undesirable fire effects, 
and to manage wildland fuels at levels consistent with wildland fire 
protection and resource management objectives identified in management 
plans. Federal agencies are directed by the policy to implement 
expanded use of prescribed fire to manage fire-dependent ecosystems, 
and reduce hazardous fuel loading. Actions specific to the Federal 
agencies' use of prescribed fire are as follows. Federal agencies will:
  --Jointly develop programs to plan, fund, and implement an expanded 
        program of prescribed fire in fire-dependent ecosystems;
  --Facilitate the planning and implementation of landscape-scale 
        prescribed burns across agency boundaries. Seek opportunities 
        to enter into partnerships with tribal, State, and private land 
        managers to achieve this objective;
  --Require appropriate treatment of fuel hazards created by resource-
        management and land-use activities;
  --Conduct all prescribed fire projects consistent with land and 
        resource management plans, public health considerations, and 
        approved prescribed burn plans;
  --Implement the National Wildfire Coordinating Group (NWCG) 
        interagency prescribed fire qualifications and certification 
        standards;
  --Train and maintain a qualified and adequate work force to plan and 
        implement interagency prescribed fire projects safely and 
        effectively, and make these personnel available when needed;
  --Jointly develop simple, consistent hiring and contracting 
        procedures for prescribed fire activities;
  --Conduct research and development on fuel treatment alternatives and 
        techniques;
  --Seek authority to eliminate barriers to the transfer and use of 
        funds for prescribed fire on non-Federal land and among Federal 
        agencies;
  --Seek authority or provide administrative direction to eliminate 
        barriers to carrying over from one year to the next funds 
        designated for prescribed fire; and
  --Jointly develop tools to identify, assess, and mitigate risks from 
        prescribed fires.
    In addition, the 1998 Wildland Fire Management Appropriation 
Request includes language that would allow for funding to be available 
from the Wildland Fire Operations account to support an expanded 
prescribed burning and mechanical fuels treatment program. This would 
provide funding needed to accomplish the tasks identified in the ``New 
Federal Fire Policy.'' Without this funding the opportunities to meet 
the identified action items will be extremely limited.
    The amount of acreage to be treated over the next few years is 
planned to be two to three times greater than treatment levels in the 
recent past. The actual treatment amount will depend on fire management 
plan updates, available funding, environmental conditions in any given 
year, and available resources such as personnel and equipment.
    Question. With current/renewed interest in scientific management of 
public lands, do you see more such activities in the near future?
    Answer. The land management plans of Interior bureaus now 
incorporate concerns about the role of fire in restoring and 
maintaining healthy ecosystems. The bureaus are developing plans to 
utilize appropriate management tools, including mechanical thinning of 
forests and the use of fire, to reduce fuels to a more natural 
condition. As part of this program, the bureaus have projected an 
increase in acres treated from about 400,000 acres in 1997 to nearly 
900,000 acres in 2001. This represents an approximate 25 percent annual 
increase for the next four years.
    Question. Are all of the land managing agencies under your purview 
undertaking such activities?
    Answer. Yes, all of the Interior bureaus are expanding fuels 
management programs on their lands and are developing integrated 
programs to manage hazardous fuels and prescribed burns across Federal 
administrative boundaries. This will increase the efficiency of 
treatments and will complement more comprehensive efforts to manage 
lands on an ``ecosystem'' basis rather than as isolated units.
    Question. In what manner are such contemplated actions coordinated 
with interested parties including adjacent landowners and local 
residents?
    Answer. Hazardous fuel treatment plans and prescribed burn projects 
are covered under environmental assessments that are submitted for 
public review and comment. In addition, many administrative units 
conduct town meetings and other public outreach programs to explain the 
purpose, timing, and possible impacts of these programs on local 
communities. The ongoing Mineral King Risk Reduction Project at Sequoia 
National Park is a good example of such an effort. That project 
involves extensive prescribed burning and mechanical fuels reduction 
both to restore fire to giant sequoia groves and to protect the 
property of private inholders in the National Park. All bureaus are 
expanding efforts to develop cooperative fuels management programs with 
adjacent State, tribal, and private landowners.
                  firefighting program infrastructure
    In the past several months there have been reports of inoperable or 
inaccurate flood gauges. The result was inaccurate predictions of flood 
cresting. This basic infrastructure provides early warning of possible 
dangerous conditions.
    Question. With the fire season approaching, and starting early in 
some regions of the country, is there any reason to be concerned about 
the reliability of such basic firefighting infrastructure as weather 
stations, lightning detection facilities, and lookouts?
    Answer. Although the basic infrastructure is sound, there is a need 
to modernize many fire management facilities to meet health and safety 
codes and to support expanded fire management efforts. The Interior 
bureaus continue to modernize and improve their capabilities to 
identify critical fire weather conditions, and to detect and quickly 
respond to lightning and human caused wildland fires. Current automated 
lightning detection systems are adequate to provide coverage throughout 
most of the lightning-prone areas of the country.
    There is also an ongoing program to expand the capability of remote 
automated weather stations to track weather and fuel moisture 
conditions and provide early warning of unusual or dangerous 
conditions. Further investments in these networks will help to support 
detailed assessments of appropriate management strategies on wildland 
fires, and prescribed weather and fuel moisture conditions on 
prescribed burns.
    The fire weather forecasting section of the National Weather 
Service has always provided a critical service to the wildland fire 
program. We are concerned with efforts to reduce specialized fire 
weather forecasters and replace them with core forecasters. It is 
important to maintain specialized skills in these offices to support 
local and spot forecasting needs identified by the bureaus. In some 
cases, additional services may be required to support expanded 
prescribed burning programs.
    Many fire lookout towers are old and in need of repair, but still 
provide a critical detection service. The bureaus support a continuing 
program within the funding provided to upgrade such facilities along 
with guard stations, fire engine storage areas, air tanker bases, and 
fire equipment caches.
                                science
    The Administration's budget for the Biological Resources Division 
of USGS includes $10.93 million and 151 FTEs for Cooperative Research 
Units (CRU). These 40 units are located in land grant and historically 
black colleges and universities. Coordination and approval of research 
in these units is done within the unit and among the Federal, State 
agency, and university partners. Similarly, the NPS budget request 
includes $2.4 million and 16 FTEs for Cooperative Ecosystem Study Units 
(CESU). These units, not funded in fiscal year 1997, would help focus 
science research regionally. In its budget, NPS proposes to work 
collaboratively with the USGS BRD to establish the CESUs and reorganize 
former NPS university-based Cooperative Park Study Units (CPSU).
                            science mission
    Question. How does the mission of the BRD CRUs differ from that 
proposed by NPS for its CESUs? Why are the CESUs being established? 
What role will they play that is not being met by other existing 
Interior research labs?
    Answer. As envisioned, the CESU network will enable close 
collaboration among researchers and resource managers to provide 
research, technical assistance, and education needed by land resource 
managers to solve complex interdisciplinary management issues that span 
the physical, biological, economic, social, and cultural sciences. The 
CESUs will not compete with the BRD CRUs or former Cooperative Park 
Study Units, but will identify resource information needs within parent 
agencies, and will offer improved access of managers to BRD and 
university expertise and capabilities.
                          science coordination
    Question. The NPS describes working with the BRD in fiscal year 
1998 to establish the CESUs, yet the BRD does not identify this 
coordination with the NPS as work in fiscal year 1998.
    Answer. Within fiscal year 1997 budget allocations, BRD already has 
research scientists stationed at universities. There is no additional 
cost for BRD to participate in the CESUs, and BRD will benefit by 
having better levels and points of contact with its partner agencies.
                            planning issues
    Habitat Conservation Plans (HCP)--Cooperative planning efforts 
among stewards for habitat on private, local, State, and Federal lands 
have been in the news lately. Several HCPs and Natural Communities 
Conservation Plans (NCCP) have been debated and approved in the larger 
public forum including the Southern California NCCP, the Balcones 
(Texas) Conservation Initiative, and the Brevard County (Florida) 
Scrubjay plan. These show the benefits of dialogue and coordination of 
interests and concerns at all levels.
    Question. Please describe the future of such planning activities, 
and the lessons learned from the process thus far.
    Answer. This program has been successful because the Department has 
forged strong partnerships with private, local, and State landowners to 
find innovative solutions that are biologically, economically, and 
politically feasible for all parties, and conserve listed species.
    The growth in HCPs is due to several factors, primarily the greater 
incentives that have been offered to landowners. Previously, the fear 
of new listings, the potential for additional mitigation measures and 
the potential to have to redo a plan left landowners leery of entering 
into a long-term agreement. The Administration's new ``no surprises'' 
policy (a deal is a deal except under extraordinary circumstances) also 
provides certainty to landowners and encourages them to come to the 
table to develop long-term contracts to protect T&E species while 
allowing economic activities to proceed. The ``no surprises'' policy 
has been critical to the willingness of landowners to participate in 
the HCP process.
    Additional factors which have increased the use of HCPs and also 
benefits both wildlife and landowners include: the development of 
multi-species HCPs covering larger geographic areas; substantial 
process improvements detailed in a new user-friendly HCP handbook; 
vastly improved coordination between FWS, the National Marine Fisheries 
Service, and other Federal parties; and a change in the FWS role from 
providing technical assistance only to full participation with 
landowners through all stages of the process.
    These are the kinds of lessons learned which can help guide the 
national debate over reauthorization of the Endangered Species Act 
(ESA). The Department continues to explore additional ideas to forge 
strong partnerships with private, local, and State landowners to find 
endangered species habitat solutions. The Department has aggressively 
accelerated the use of additional existing authorities under the ESA to 
ease the regulatory burdens of the ESA on private, State, and other 
landowners. The Department would not be adverse to incorporating the 
``10 Principles'' into the ESA. Many of those principles grew out of 
our early involvement with the HCP process.
    The ``safe harbor'' program encourages landowners to provide 
habitat for listed species. Under this program, private landowners with 
assistance from FWS or with other qualified Federal or State agencies 
develop a management program to be carried out on their lands for the 
benefit of listed species. Based on such a program, a safe harbor 
agreement is entered into by FWS and landowner. The FWS, in turn, will 
issue the private landowner a permit for the future take of listed 
species above the existing baseline conditions at the time of the 
agreement.
    The ``no surprises'' policy assures private landowners 
participating in HCPs that no additional requirements will be imposed 
on plan participants for species covered by the HCP except under 
``extraordinary circumstances.''
    These are partnership agreements where the landowner approaches the 
Department to develop a solution to allow economic development to 
proceed while protecting T&E species. The Department is confident that 
adequate safeguards are built into the permit process to avoid future 
potential problems. Within the framework of the HCP, it is the 
applicant's responsibility to carry out FWS-approved monitoring regimes 
to determine the effectiveness of the terms and conditions of the 
agreement to minimize and mitigate the effects of the action. The FWS 
is responsible for ensuring the compliance with the terms of the HCP 
and evaluating the effectiveness of the actions on the covered species.
    In addition, FWS incorporates adaptive management clauses into HCPs 
that may cover a species for which FWS may not have all of the 
scientific information needed at the time of HCP development. Where 
these data gaps occur, not all of the questions regarding the long-term 
effects of implementing these HCPs can be answered. In these cases, FWS 
has begun to work with the applicants to incorporate adaptive 
management into the strategies designed to mitigate the effects of the 
HCP. These provisions are especially useful for species whose biology 
is not fully understood when the HCP is developed and the landowner 
wants to cover them. These provisions allow FWS to work with the 
landowner to change management strategies within the HCP area, if new 
information about the species indicates this is needed.
    Cooperation to date has been impressive. Indeed, our field offices 
report a surge of additional non-required ``monitoring'' and 
``consultation'' visits requested by eager HCP permittees.
                          gateway communities
    In fiscal year 1997, NPS is undertaking a pilot program to work 
collaboratively with four ``gateway'' communities on mutual planning 
and development related issues.
    Question. What are the four communities?
    Answer. The NPS identified several candidates for pilot projects 
addressing gateway communities in response to recommendations in the 
Vail Agenda. The initial pilot projects were Sitka in Alaska; Elbe, 
Ashford, and Greenwater near Mount Rainier in Washington; and Tusayan 
adjacent to Grand Canyon in Arizona. Larimer County Colorado, 
Springdale, Utah, and Gettysburg, Pennsylvania also have been 
recognized as models for cooperative relationships with adjacent 
national park units.
    Question. What is the scope of these projects?
    Answer. At Mount Rainier and several other units conservation 
assistance projects have helped local communities develop visions of 
the future and specific goals in the early stages of general management 
planning for the adjacent park. In some cases such as the Grand Canyon, 
the park's general management plan has addressed alternatives for the 
adjacent community to become a staging area for visitor information, 
transportation, and other services. Rocky Mountain National Park co-
sponsored a conference with local officials in other surrounding 
jurisdictions to share ideas about cooperative planning. At Sitka, the 
park's general management planning project has been coordinated with 
local plans for visitor services and interpretation, transportation 
(including a shuttle bus system), design assistance for signs, and 
overall visual quality.
    Question. What is the projected outcome of these joint efforts?
    Answer. In general, the expected outcome is improved cooperation 
with the communities on transportation, public services, visual 
quality, future development patterns, and other matters. For example, 
the community assistance projects at Mount Rainier provided a basis for 
improved coordination with the communities throughout the general 
management planning process. At Sitka, a plan is currently helping to 
guide local decisions. The Grand Canyon general management plan's 
recommendations for improved visitor services in adjacent communities 
are being addressed as more detailed implementation plans and are being 
developed by the NPS and the towns around the park.
    Question. How were the communities selected for the pilot?
    Answer. The NPS Regional Offices were invited to submit nominations 
for the selection of the initial pilot projects in 1993. Twenty-five 
candidates were submitted, reviewed in the Headquarters Office, using 
criteria such as likelihood of success, and the best proposals were 
identified as pilot projects.
    Question. Is this a model which will be incorporated into future 
NPS planning efforts?
    Answer. Yes, NPS recently conducted two seminars on lessons learned 
in cooperative planning with gateway communities. Several suggestions 
are currently under consideration for how to assure that lessons 
learned with these pilot projects and other initiatives are 
incorporated into routine park management as well as future planning 
projects. However, one of the conclusions is that successful 
cooperation between parks and adjacent communities requires tools and 
relationships that are designed to fit local circumstances. Park 
managers, planners, and local communities will be encouraged to learn 
from past experiences, but to choose from various models one that is 
most likely to work for their specific purposes.
    Question. Do you anticipate any new starts of such efforts in 
fiscal year 1998?
    Answer. Lessons learned from these pilot projects will be 
incorporated in new general management planning projects wherever 
possible. The Rivers, Trails, and Conservation Assistance program also 
is expected to continue placing a high priority on support for some 
projects in communities adjacent to NPS units.
    Question. Are there any plans to coordinate these efforts on an 
interagency basis in areas where other Federal land managing agencies 
have a presence?
    Answer. Cooperative planning efforts with local communities 
routinely involves coordination with other Federal land managers. 
Interagency efforts with the U.S. Forest Service have been most evident 
in examples at Grand Canyon, Sitka, and Mount Rainier, but other 
Federal, State, and local agencies have been involved as well. 
Cooperation with other Federal agencies is expected to continue in 
future projects.
                               volunteers
    The Department and the land managing agencies have taken some 
creative approaches to supplement Federal funding of public lands 
management. In the past several years there has been an enhanced 
revenue stream through the recreation fee demonstration program, 
through the efforts of cooperating associations and friends groups, the 
use of volunteers, and partnering with private industry (i.e., recent 
American Airlines announcement).
    Question. Please describe the use of volunteers in each applicable 
Interior agency and the impact that volunteer, community service, and 
internship programs has had on the ability of the agencies to 
accomplish their responsibilities.
    Answer. The BLM, USGS, FWS, NPS, BIA, and BOR all have successfully 
used volunteers to supplement the work of bureau employees as follows:
    Since 1981, volunteers have played an important role in helping BLM 
achieve its mission. Each year over 19,000 volunteers provide vital 
assistance to BLM in the management of public lands and associated 
resources. Volunteers not only contribute work time, which is estimated 
to be valued at over $13 million each year, but they are taking on 
increasingly important roles in serving as team members, providing 
customer service, serving as important links to local communities, and 
providing innovative ideas and resources. Each of the 12 BLM State 
Offices has an active volunteer program where people of all ages pitch 
in without compensation to do such things as build trails, restore 
watersheds, patrol cultural sites, write informational brochures, staff 
visitor centers, train wild horses, clean-up recreational sites, 
provide engineering support, program computers, and conduct educational 
programs. Recently BLM honored eight outstanding volunteers for their 
dedication and contributions in the following areas: educational and 
public presentations about the BLM Adopt-a-Horse program, mechanical 
engineering skills, recording archaeological sites, conducting weekly 
maintenance of trailheads and campsites, conducting interpretive talks, 
staffing information desks, and greeting visitors.
    The BLM is also actively involved in community service through such 
events as the National Public Lands Day, an annual volunteer program 
designed to bring thousands of citizens to public land sites for hands 
on restoration work and conservation education. The BLM also sponsors a 
number of environmental education programs for all age groups of school 
children in both classroom settings and field site exercises. Outdoor 
classrooms provide information and instruction in a variety of 
subjects, including geology, archeology, wildlife, and botany. The 
programs are designed to spark interest in children in both stable and 
at risk environments to learn about cultural and natural resource 
issues and gain a better understanding and appreciation for their 
world.
    AmeriCorps participants are accomplishing essential on-the-ground 
work in environmental protection and restoration activities for the 
Department and to the mutual benefit to both the Federal Government and 
our partners.
    At Fort Ord, AmeriCorps participants have worked to protect 7,250 
acres by building fences and barriers which protect many acres of new 
habitat created for the reintroduction of endangered species as well as 
300 habitat improvement and erosion control projects. Protection of 
sensitive wetlands and endangered species habitat through the planting 
of shrubs and grasses continues. Transformation of the former military 
base to public recreation lands and wildlife habitat has begun.
    The USGS Volunteer for Science Program is an invaluable component 
of the USGS workforce. Every year nearly 10,000 volunteers from all 
segments of the American population--from school children to scientists 
emeritus--perform tasks ranging from entry-level clerical to highly 
technical scientific services. The Volunteer for Science Program is 
dynamic and flexible enough to satisfy high school students' community 
service requirements, provide internship opportunities for college 
students, give retired scientists and technical experts a place to 
continue to be productive and valuable to this Nation, and fulfill 
personal desires to contribute to the wise management of our natural 
resources.
    The USGS gains significantly by receiving nearly one-half million 
hours of assistance annually in support of its mission. On a cost 
basis, volunteers replace nearly $6.5 million in salary dollars. In 
some cases, volunteer time is key to project success and tips the 
balance from not getting the job done to accomplishing the job within 
the needed time frame. Even if USGS were provided the resources to hire 
employees to replace volunteers, it would be difficult to find the 
numbers of people with the expertise to do what our volunteers do free 
of charge. Many volunteers are expert in geology, digital mapping, 
engineering, computer science, ornithology, parasitology, mammalogy, 
ichthyology, ecology, and biology. Others are experienced in public 
education, technical writing, accounting, animal husbandry, and other 
specialties.
    In 1982, FWS was aided by 4,521 volunteers who contributed 128,440 
hours. Participation has steadily increased to 25,840 volunteers and 
1.1 million hours in 1996. These volunteers work at a variety of tasks 
ranging from construction and repair projects to orienting and 
educating visitors to assisting with fish and wildlife surveys and 
habitat improvement projects. Volunteers include individuals, boy 
scouts, girl scouts, American Association of Retired Persons, Friends 
groups, local Audubon Chapters, and school groups to name a few. The 
FWS also uses volunteers from organizations such as the Student 
Conservation Association and AmeriCorps.
    Volunteers supplement FWS resources, as described in the following 
examples: Edwin B. Forsythe NWR volunteers assisted in piping plover 
nest surveys and population monitoring when the refuge staff was unable 
to continue its weekly waterbird surveys. Ash Meadows NWR volunteers 
removed 240 inactive utility poles during April and May. They donated 
504 hours and saved $100,000 for FWS. At Bitter Lake NWR, the Roswell 
Job Corps constructed a handicapped-accessible Watchable Wildlife 
overlook.
    At the Rio Grande project, AmeriCorps participants have restored 
150 acres of riparian habitat, planted some 15,000 seedlings for 
erosion control, and conducted vegetation studies as well as photo 
documentation of oil spill contamination and cleanup efforts. Over 70 
ecosystem, fish, wildlife, and water quality research projects have 
begun and been completed. In addition, endangered species ``tool kits'' 
for teachers have been created.
    The NPS considers anyone to be a volunteer who contributes his/her 
time and expertise to the agency for no pay. Official NPS volunteers 
must sign a volunteer agreement to be covered under the provisions of 
P. L. 91-357, as amended. The NPS uses volunteers in nearly every 
sector of the agency and almost every unit of the National Park System. 
Volunteer activities in NPS are summarized in nine general categories. 
The following list summarizes NPS volunteer activities for fiscal year 
1996: Administrative Support, five percent; Campground Hosting, eight 
percent; Curation, two percent; Archeology, one percent; 
Interpretation, 39 percent; Maintenance, 16 percent; Resource and 
Visitor Protection, five percent; Resource Management, 19 percent; and 
Other, five percent.
    At the Everglades-South Florida ecosystem project, AmeriCorps 
participants have conducted 78 fish, wildlife, and water quality 
research projects at four National Parks and six Fish and Wildlife 
units. Automated water monitoring stations and Coral Reef nurseries for 
future marine habitat restoration have begun. Exotic plant removal has 
been accelerated.
    Volunteers are nearly always beneficial in BIA response operations. 
However, much of the response to recent storm damage undertaken by BIA 
required use of equipment and trained personnel for major repair work. 
No volunteer equipment and/or operators were available to assist during 
the disaster periods. On the community services side, Indian 
communities came together to work for the common good during the 
crises. Both the youth and elderly of Indian communities assisted by 
filling and stacking sandbags; evacuating homes; providing shelter for 
family, friends, and neighbors; helping unload trucks; and delivering 
food. The communities did what they could do within their limited 
resources and abilities to assist each other. Unfortunately internship 
programs are not available in all communities to assist in the 
necessary repairs and carry out the needed rebuilding and construction 
of damaged buildings, roads, irrigation structures, etc.
    The BOR has many volunteers which have proven to be a successful 
tool in productivity and efficiency for the Bureau and local 
communities. Volunteers in BOR are used in a variety of ways. Some 
examples from the past year include: providing clerical and 
administrative support; providing visitors to Hoover Dam with 
information and assistance; assisting in cataloging and curating Hoover 
Dam's museum quality documents, photos, and other historical items; and 
serving as judges for the National Science Fair. In one region alone, 
specific programs include: Partners in Education, 47 volunteers/607 
hours; Participation in Paint The Town 28 volunteers/156 hours; 
Participation in Rake-Up-Boise 31 volunteers/124 hours; Catch A Special 
Thrill (C.A.S.T.) Fishing 90 volunteers/720 hours; Idaho Adopt-a-
Highway 10 volunteers/40 hours; Christmas Adopt-A-Family 23 volunteers/
64 hours; Employee-Sponsored Scholarship Fund 20 volunteers/90 hours; 
and Area Pond Clean-Up six volunteers/48 hours.
                               education
    Question. Is the Department working with the Department of 
Education on science issues in education?
    Answer. The Interior Education Committee, which includes 
representation from each of the bureaus, has worked with the Department 
of Education to keep abreast of the Federal role in science education. 
The Goals 2000 Subcommittee to the Interior Education Committee has 
convened meetings on matters relating to the Educate America Act--Goals 
2000. The Department of the Interior's school partnership program is 
one of the focuses of the subcommittee. The subcommittee also keeps 
abreast of new initiatives sponsored by the Department of Education.
    Question. Which agencies are involved in this effort?
    Answer. The USGS has cooperative education projects with the 
National Aeronautic and Space Administration and the National Oceanic 
and Atmospheric (GLOBE Program) in addition to cooperative projects 
with other bureaus within Interior, including NPS and BIA. A 
subcommittee to the National Science and Technology Council with 
interagency representation meets to discuss grant programs in 
educational technology for school districts (K-12). The Subcommittee on 
Educational Technology is sponsored by the Department of Education and 
the Office of Science and Technology Policy. The USGS represents the 
Department on this committee for fostering technology in education.
    Question. Describe how the Department shares with the children in 
America's schools the lessons learned though research on public lands 
and in the bureaus.
    Answer. The USGS has 14 partnership schools nationwide in 
accordance with Executive Order 12821. The Interior Subcommittee works 
with the bureaus to provide guidelines for administering a formal 
School Partnership Program. The USGS also serves students with the 
Volunteer for Science Program, which dovetails with community service 
programs in most schools nationwide. The USGS administers the 
Excellence in Education Initiative, a project-based program, to develop 
materials for the K-12 education community and to teach teachers about 
the latest scientific developments in the earth and biological 
sciences. The USGS Visitors Center hosts about 10,000 visitors each 
year from schools throughout the DC metropolitan area via a tour 
program, activities-based learning, and science summer camp.
                          employee development
    Question. How does the Department ensure that its employees are 
kept current on emerging technologies and competencies in professions 
relating to the sciences?
    Answer. The Department encourages state-of-the-art technical 
competency by promoting and supporting continuous academic development 
including graduate course work, research, and independent study. 
Because of the job relatedness of technical academic studies, most 
course work is paid for by the employing bureaus. Technical 
professionals are also encouraged to attend conferences and symposia, 
to be active members in professional societies, and to subscribe to 
professional journals and publications. Costs associated with these 
activities, including travel and fees, are typically borne by the 
bureaus; employees are usually permitted to participate on Government 
time, as part of their regular duties.
    Question. Do the bureaus have similar employee development goals 
and moneys available for training?
    Answer. Employees of bureaus such as USGS, FWS, and the Bureau of 
Reclamation are regarded worldwide as experts and leaders in their 
fields. This level of recognition is gained only by state-of-the-art 
competency acquired through constant employee development. The 
financial commitment to this development is many times greater, in 
absolute terms and as a percentage of overall funding, than in non-
scientific bureaus. Non-scientific employees in all bureaus are also 
supported in maintaining a high level of technical competency in their 
occupational areas.
                 government performance and results act
    The Government Performance and Results Act (GPRA) requires that 
each agency submit by September 30, 1997 a strategic plan for program 
activities.
    Question. What Congressional consultations have taken place to 
date, both on a departmental and bureau level?
    Answer. The following table summarizes Interior's consultation 
process with the Congress since November of 1996. To date the 
Department and all eight of its bureaus have consulted with 
Congressional staff including the House GPRA team.

                                       CONGRESSIONAL CONSULTATION SCHEDULE                                      
----------------------------------------------------------------------------------------------------------------
              Bureau                        Date                             Parties consulted                  
----------------------------------------------------------------------------------------------------------------
Department, NPS..................  Nov. 20,1996.........  House/Senate Appropriations staff.                    
Department, NPS, OSM.............  Dec. 16, 1996........      Do.                                               
MMS..............................  Feb. 4, 1997.........      Do.                                               
Department/NPS...................  Feb. 7, 1997.........  Senate Energy staff/Senate Environment and Public     
                                                           Works staff.                                         
FWS..............................  Feb. 24, 1997........  House/Senate Appropriations staff.                    
MMS..............................  Feb. 26, 1997........  Government Operationsand Reform staff.                
USGS.............................  Feb. 28, 1997........  House Appropriations staff.                           
MMS..............................  Mar. 5, 1997.........  House Resource Committee staff.                       
NPS, BLM.........................  Apr. 18, 1997........  House GPRA team.                                      
FWS, USGS........................  Apr. 25, 1997........      Do.                                               
BOR, WRD-USGS....................  May 2, 1997..........      Do.                                               
MMS, OSM.........................  May 9, 1997..........      Do.                                               
BIA..............................  ...do................      Do.                                               
Department.......................  May 8, 1997..........      Do.                                               
FWS..............................  June 26, 1997........      Do.                                               
Department.......................  July 11, 1997........      Do.                                               
Department--Insular Affairs......  Aug. 21, 1997........  House Appropriations staff.                           
FWS..............................  Aug. 25, 1997........      Do.                                               
----------------------------------------------------------------------------------------------------------------

    While the Senate is still organizing its GPRA review process, 
copies of draft strategic plans have been sent to Majority and Minority 
staff for the following Committees: Senate Appropriations; Senate 
Budget; Senate Governmental Affairs; Senate Energy; and Senate 
Environment and Public Works. The Department has offered and is 
available for further consultations.
    Question. Please describe the efforts undertaken to date by the 
various land managing bureaus to coordinate development of meaningful 
goals and measurements for responsibilities common to the bureaus.
    Answer. The Department of the Interior, as part of its strategic 
planning process, has established a Strategic Planning Steering Group 
to guide the development of the Interior bureau strategic plans. This 
group is composed of senior planning officials from each bureau, as 
well as representatives from the Departmental budget and financial 
management offices. This group is working closely to develop the bureau 
components of the Department's strategic plan and providing the 
mechanism for the bureaus to coordinate the development of strategic 
goals and measures.
    The BLM has sponsored the Natural Resources Performance Measures 
Forum that has brought senior planners from BLM, FWS, BIA, NPS, USGS, 
the Environmental Protection Agency, Department of Agriculture, 
Department of Defense, Corps of Engineers, National Oceanic Atmospheric 
Administration, and other agencies together over the last year to share 
plans and discuss goals and performance measures for common issues. 
This group has been successful in establishing the dialogue needed for 
agency plans to be more complementary.
    Question. What mechanism is in place to review the multiple plans 
submitted to the Department by the bureaus?
    Answer. The Office of Planning and Performance Management, which 
reports to the Assistant Secretary--Policy, Management and Budget, is 
responsible for coordinating the review of all the bureaus plans. 
Bureau plans are forwarded to key Departmental Offices for agreement 
with policy, legal, and budgetary issues.
    Question. How will different measures of common goals be managed?
    Answer. The Department of the Interior deals with many complicated 
issues in the management and preservation of the Nation's public lands. 
The Department has a diverse set of missions and program 
responsibilities that inherently are ``in tension'' with each other.
    Each bureau is developing a plan with goals that support its 
legislated mission. While several bureaus have land management 
responsibilities, in most cases the legislation requires different land 
uses with different outcomes. For example BLM is required to manage 
lands for multiple use including consumptive as well as recreational 
uses while NPS legislation directs the agency to preserve the natural 
and historic resources of the land and provide for the public's 
enjoyment of those lands in perpetuity. Because of these fundamental 
differences, each bureau has developed goals and measures that allow 
the organization to measure performance and manage their organizations 
to fulfill their legislated mission.
    Question. Do you anticipate common vocabulary among the land 
managing agencies in terms of defining goals and measuring progress?
    Answer. The Natural Resources Performance Measures Forum sponsored 
by BLM has worked extensively on these issues and progress has been 
made but much remains to be done. The forum has worked to define 
``recreational opportunities'' and the ``health of the land'' but there 
is no consensus for measurement across the Government. Resolving this 
and related cross agency issues are anticipated to be one of the 
challenges that will be addressed as future iterations of strategic 
plans are developed.
              grand staircase-escalante national monument
    The President created the Grand Staircase-Escalante National 
Monument in September 1996, and BLM has been charged with planning and 
operating the Monument. The BLM has begun an estimated three-year 
planning process.
    Question. Please describe efforts to coordinate facilities, 
tourism, and visitation issues with other recreational facilities in 
the vicinity of the Grand Staircase-Escalante National Monument area. 
These other recreational facilities include Utah State Parks, as well 
as Forest Service and NPS units.
    Answer. The Monument planning team has taken a number of steps to 
ensure full coordination with other recreation facilities near the 
Grand Staircase-Escalante National Monument. The Monument planning team 
includes five members nominated by the Governor of Utah, who was 
invited to do so by the Secretary. These members have a thorough 
knowledge of local development issues, including tourism. They include 
a community planner from the Five County Associations of Governments, 
an employee of the State Parks Division, and an employee of the 
Wildlife Resources Division. The planning team has also been in 
frequent contact with representatives from Bryce Canyon National Park, 
Capitol Reef National Park, Glen Canyon National Recreation Area, Dixie 
National Forest, and Kodachrome Basin State Park. The BLM will continue 
to work closely with these representatives during the planning process. 
The planning team also includes two experienced BLM recreation planners 
who will be coordinating with local tourism and recreation interests.
    Through the agreements with Kane and Garfield Counties, BLM has 
already taken steps to ensure that the planning team will be kept fully 
abreast of important local information, including:
  --Socioeconomic information, including population trends and data;
  --Opportunities to create and maintain sustainable community 
        economies;
  --Infrastructure;
  --Public safety needs including law enforcement, search and rescue, 
        and aid to visitors in the Monument; and
  --In the case of Kane County, an updated county plan.
    Question. Please describe efforts to involve the local communities 
in the planning efforts for the Monument.
    Answer. The BLM has established a variety of formal and informal 
mechanisms to ensure that the planning team works closely with local 
communities and governments during the planning process. Monument 
manager Jerry Meredith, who served formerly as Cedar City District 
Manager, has brought to the planning team extensive experience in 
working with the local communities and governments. He has met with all 
the mayors of communities near the Monument, with the exception of Big 
Water. Monument staff participate in regular meetings with each county, 
as well as in meetings of the Southern Utah Planning Advisory Council. 
The planning team has a formal working relationship with the Community 
and Economic Strategic Planning Committee, which is appointed by the 
Governor. As noted earlier, the Secretary invited the Governor of Utah 
to provide five members for the planning team. Among the five full time 
members nominated by the Governor and agreed to by the Secretary is a 
community planner from the Five County Association of Governments who 
has considerable background and familiarity with local needs and 
concerns regarding the Monument.
    The BLM has also acknowledged the important role of communities and 
local governments in the planning process by providing them with 
financial assistance. In the fall of 1996, BLM offered to extend 
cooperative agreements with both Kane and Garfield Counties to help 
them participate in the planning process. Although Garfield County 
initially declined the offer, both counties have since joined BLM in 
signing cooperative agreements which will be used to facilitate the 
counties' participation in the Monument planning process.
    The BLM is also a participant, on an ex-officio basis, on the State 
of Utah's Community and Economic Development Strategy Team. The team, 
made up of representatives of local towns, counties, civic 
organizations, and business groups appointed by Governor Leavitt, has 
been charged with the development of a strategic plan for lands 
adjacent to the Monument as well as looking at other Monument-related 
issues that directly affect surrounding communities.
    The NPS is currently working with four ``gateway'' communities near 
national park sites to develop planning documents and guidelines for 
development.
    Question. Will the lessons learned from that experience be of value 
to BLM during its planning for the Grand Staircase-Escalante National 
Monument?
    Answer. The BLM understands that in planning for the Monument, the 
planning team must build on its own experience, as well as that of 
other agencies, including NPS and the Forest Service. Shortly after the 
designation, BLM contacted Warren Brown, Program Manager for Park 
Planning and Special Studies of NPS, to determine what information 
could be learned from NPS park and Monument planning efforts. In 
addition, BLM has consulted with individuals from the Great Basin 
National Park, Golden Gate National Resource Area, Crater Lake National 
Park, Mojave National Preserve, Columbia River Gorge National Scenic 
Area, Mt. Saint Helens National Volcanic Park, and the El Malpais 
National Conservation Area. These areas were all designated relatively 
recently. The BLM will continue to consult with these individuals 
throughout the planning process to take advantage of their knowledge 
and experience, particularly with regard to gateway communities.
    Question. Please describe opportunities for employment of local 
residents.
    Answer. The BLM anticipates that the Monument will stimulate long-
term, sustainable employment opportunities, particularly within the 
communities adjacent to the Monument. The area has already seen an 
increase in the demand for visitor services and information, as well as 
a need to address concerns over public safety. The BLM also anticipates 
that the Monument plan will provide for infrastructure improvements at 
campgrounds and day use areas, which in turn will be tied to job 
opportunities for local residents. Public interest and support for the 
Monument is already apparent. In May, 1997, the Escalante Visitor 
Center reported 4,000 visitors, twice the previous monthly high of 
2,000. The number of visitors to the Monument itself is estimated to be 
much higher still. These visitors will provide economic benefits for 
restaurants, motels, gas stations, and other recreation-related 
businesses. Moreover, while it is difficult to assess long-term growth 
in employment opportunities outside the Monument's boundaries, BLM 
expects that the Kane and Garfield counties' success in attracting new 
and more diverse businesses will only be heightened by visitor interest 
in the Monument.
                     vanishing treasures initiative
    For fiscal year 1998, NPS has proposed a new 10-year, 41-park 
initiative in the arid west to bring historic and prehistoric 
structures maintenance from emergency repairs resulting from 
deteriorating conditions to a stabilized condition that will allow 
maintenance and preservation on a routine basis. The fiscal year 1998 
request for the ``Vanishing Treasures'' initiative is $3.5 million and 
involves physical restoration as well as 18 new FTEs and associated 
training. The FTE proposed essentially doubles the number of personnel 
now occupying positions of similar responsibility, and begins the 
growth curve in personnel currently identified as necessary to carry 
out the 10-year initiative.
    Question. Given the large investment in attracting and training 
skilled preservation maintenance workers and archeological and cultural 
resource preservation personnel, and given the fact that many other 
Federally-managed arid lands in the west have similar resources, do you 
anticipate that other land managing agencies will look to NPS to 
provide FTE and technological resources for stabilization of their 
resources?
    Answer. The NPS acknowledges its responsibility under the National 
Historic Preservation Act and other authorities to provide training, 
technical information, and other assistance to other Federal agencies 
in preserving prehistoric and historic places under their jurisdiction 
or control. However, the Vanishing Treasures proposal described in the 
budget request has been calculated in terms of expertise and work 
needed in 41 parks in the arid west. The requested dollars and FTE were 
not calculated to enable NPS to provide money or FTE to do work on 
other Federal lands. It is possible, however, that other agencies and 
parties such as owners of certain types of National Historic Landmarks 
could participate in Vanishing Treasures-sponsored training and could 
benefit significantly thereby.
    Question. Are there similar resources on BLM, FWS, and Bureau of 
Reclamation lands that might also need protection?
    Answer. Most extensive tracts of Federal lands, including lands 
managed by other Federal agencies in the arid west contain prehistoric 
and historic ruins of varying degrees of significance, preservation, 
and preservability.
    Question. What about on BIA lands?
    Answer. The above answer applies to resources on BIA lands as well 
as to those on BLM, FWS, and BOR lands.
    Question. Are there plans for technical assistance to the BIA?
    Answer. Presently, there are no plans for such technical 
assistance, but should BIA request NPS assistance, NPS would do its 
best to help.
    Question. Are there similar assemblages of sites or artifacts 
elsewhere in the U.S. that could be protected through similar 
initiatives?
    Answer. One could group historic and prehistoric resources into 
categories and describe their needs in that way. The problems of 
preserving ruins in the arid west are so similar from one park to 
another, and the specific needs so acute, that the Vanishing Treasures 
parks make up an obvious grouping within which to solve their problems. 
The Vanishing Treasures initiative is only part of the larger $6.5 
million request for increased cultural resource management, and other 
elements of the request are proposed to assist other sites in the 
United States.
                             infrastructure
Roads maintenance
    A 1997 joint reinvention study between BLM and the Forest Service 
identified savings of up to 20 percent in the efficiency and amount of 
road maintenance that could be accomplished through sharing equipment 
and improving coordination between among the agencies.
    Question. Are the recommendations in this study being implemented?
    Answer. Yes, many of the recommendations in the report are being 
implemented. All States are evaluating their heavy equipment needs and 
equipment for opportunities for cost saving through increased 
utilization and partnering with the Forest Service. The BLM Washington/
Oregon State Office is currently piloting interagency crews. Several 
local agreements are being pursued in many western States. The BLM and 
Forest Service are in the final steps of establishing a national level 
Interagency Agreement which can be used by local offices to streamline 
coordination and resource sharing.
    Question. Are there lessons learned that can be applied to 
cooperative work with other agencies?
    Answer. Yes, BLM and the Forest Service are leading the way in 
working together to better service the general public and commodity 
users in transportation management. Because the missions of these two 
agencies are closely aligned, there are more opportunities for cost 
saving and improved efficiencies between BLM and the Forest Service. 
However, opportunities exist with FWS, NPS, BIA, and other Federal, 
State, and local land managing agencies. The national agreements will 
become models for other agencies to follow.
                         federal lands program
    Since the 1982 authorization of the Highway Trust Fund, almost $1.1 
billion has gone to NPS through the Federal Lands Highway Program and 
the Park Roads and Parkway Program. In order to bring the roads and 
related facilities to a condition in which the parks would be able to 
maintain that infrastructure through annual operations funding, FHWA 
and NPS analyzed data which indicate a $2.2 billion backlog of 
necessary projects.
    Question. How does NPS propose to address these necessary projects?
    Answer. There are some 8,000 miles of public park roads and more 
than 1,250 bridges under the jurisdiction of NPS serving units of the 
National Park System. About 60 percent of these roads are paved. The 
current condition ratings of paved park roads are 38 percent ``good''; 
22 percent ``fair''; and 40 percent ``poor/failed''. Of the more than 
1,250 bridges in the National Park System, 35 percent are deficient. At 
the currently authorized Federal Lands Highway Program level of $84 
million, FHWA engineering analyses indicate that an additional one 
percent of park roads will continue to deteriorate to a ``poor'' or 
``failed'' condition each year. Based on FHWA estimates, approximately 
$120-125 million annually is needed to reverse this rate of 
deterioration. In line with that estimate, the Administration is 
requesting a total of $161 million beginning in fiscal year 1998 under 
the Federal Lands Highway Program, subject to Congressional 
reauthorization of the program, which will be utilized to address 
National Park Service Road and Transportation needs as follows:
  --$120-125 million annually to prevent further deterioration of the 
        paved park road and parkway infrastructure to ``poor'' or 
        ``failed'' condition;
  --$25-35 million annually to complete construction of Congressionally 
        authorized parkway projects; and
  --$5-15 million annually to implement alternative transportation 
        systems in selected parks.
    Question. Is there a priority list of projects?
    Answer. Yes, NPS maintains and periodically updates a Servicewide 
priority listing of needed road and bridge projects.
    Question. Do immediate safety concerns take precedence over planned 
projects?
    Answer. Yes, and dependent upon the availability of funds, such 
problems are addressed as soon as possible.
    Speed limits on roads which run through NPS sites has been the 
subject of much debate recently. There has been public concern over the 
number and severity of accidents which have occurred on the George 
Washington Memorial Parkway in Virginia. Excessive speed has been cited 
as the cause of most of the accidents. In Organ Pipe Cactus National 
Monument in Arizona the speed limit has recently been raised to 65 
miles per hour-far above the 45 mph set in regulations for most of the 
NPS roads.
    Question. How does NPS plan to deal with the issue of roads serving 
dual purposes, visitors and through travelers?
    Answer. The problems associated with park road serving dual 
purposes presents an ongoing challenge to park managers. In response to 
several highly publicized accidents on the George Washington Memorial 
Parkway, park management there has added additional Park Police patrols 
to enforce posted limits, and is using two mobile, radar speed 
indicator display signs to slow down traffic. Also, NPS recently began 
installing additional median guardrails to lessen the potential for 
head-on collisions on the parkway north of Spout Run in Virginia.
    The roadway through Organ Pipe Cactus in Arizona is a locally 
administered highway with the speed limit set by local authorities. 
Park management there has been engaged in negotiations with the State 
officials in an attempt to get the speed limit lowered, and NPS is on 
record in opposition to their recent decision to raise the speed limit.
    With respect to the general issue of park roads, NPS, in 
cooperation with the Federal Highway Administration, is currently 
developing various management systems and investment strategies to 
influence future park road program focus. Factored into this strategy 
as a key component is the need to address the through travel issues, 
growing congestion, and associated resource concerns that have become 
increasingly serious problems in national parks.
    Where appropriate, alternative transportation modes are being 
considered to help handle the rapidly growing traffic demands and to 
reduce the resource impacts associated with increasing numbers of 
visitors and motor vehicles. A study on alternative transportation in 
parklands was submitted to Congress in 1994. Also, a Presidential 
memorandum dated April 22, 1996, directed the Secretary of the 
Interior, in consultation with the Secretary of Transportation, to 
enhance access to, and mobility within, our parks. In line with this, 
NPS has initiated a multi-year program of planning efforts for 
alternative transportation systems, which is now well underway in 
Yosemite, Yellowstone, Denali, Zion, and Grand Canyon National Parks. 
Additional transportation planning efforts have also been initiated at 
Acadia, Crater Lake, Sequoia, Mount Rainier, Indiana Dunes, the 
Presidio, and Bandelier.
    Question. Is there likely to be an increase in construction and 
upgrading of the roads in response to more traffic and higher speeds?
    Answer. In response to more traffic, NPS intends to look primarily 
at various alternate transportation modes. In line with this, and in 
response to many years of funding shortfalls, and to maximize use of 
limited fiscal resources, NPS, in cooperation with FHWA, is currently 
developing enhanced investment strategies using various management 
systems to influence future program focus. Factored into this strategy 
as a key component is the need to address the congestion and associated 
resource concerns that have become an increasingly serious problem in 
national parks.
    In terms of increased speeds, NPS continues its law enforcement 
presence in order to ensure the safety of the roadway. Unfortunately, 
NPS law enforcement personnel can not be in all places at all times, so 
there are accidents that result from excessive high rates of speed.
    Question. How would priorities be set for projects of this type?
    Answer. A study on alternative transportation in parklands was 
submitted to Congress in 1994. A Presidential memorandum dated April 
22, 1996, directed the Secretary of the Interior, in consultation with 
the Secretary of Transportation, to enhance access to, and mobility in, 
our Nation's parks. It is estimated that $5-15 million annually is 
needed to initiate a multi-year program of planning efforts and 
projects for alternative transportation systems in selected parks.
                            mapping project
    In fiscal year 1998 the USGS proposes to establish a mapping and 
modeling database over a three-year period using Landsat data and 
mapping technologies to track population growth and land development.
    Question. Which cities have been selected for this program?
    Answer. The four metropolitan areas proposed are Chicago, New York 
City, Philadelphia, and Portland, OR.
    Question. Are these areas of ecological concern or where HCPs are 
under development?
    Answer. The four cities were selected from the American Farmland 
Trust (NFT) list of high priority cities where urbanization threatens 
agricultural land. Further refinement of the list was done by examining 
cities where there was concern for impacts on ecological diversity in 
very different ecological regions. Specific city selections had 
additional regional criteria as well. Philadelphia and New York were 
then identified as major urban areas that would continue the work 
started in the Washington/Baltimore area, thus expanding into major 
portions of the Eastern Corridor and the Eastern Megalopolis. Chicago 
was identified as a critical mid-western city that met the NFT and 
ecological criteria. Portland, Oregon was selected because the effect 
of different land use planning models being used in Washington and 
Oregon can be compared in subsequent research. It met the other NFT and 
ecological criteria as well. All cities were chosen to meet multiple 
criteria important for geographic research.
                                 ______
                                 
               Questions Submitted by Senator Ted Stevens
            brooks river, katmai national park access issue
    The National Park Service (NPS) has prepared a final Environmental 
Impact Statement (EIS) and Record of Decision which would establish a 
management plan for the Brooks River area in Katmai National Park. The 
plan's intent is to regulate day users in order to lessen stress on 
bears. However, NPS picked the most expensive alternative, which 
requires moving Brooks Camp to the other side of the River, rather than 
building bear viewing boardwalks in the heavily used areas. I am 
advised that moving Brooks Camp may require a $9 million appropriation. 
In addition to adopting a plan that would require high funding, the 
plan would also regulate day use through caps and include overnight 
guests and anglers in these caps. Very recently, it has been reported 
that NPS is enforcing these caps through requiring registration of 
people taking flights to the Brooks River area.
    Management could occur through a system of boardwalks to contain 
heavier day uses to the bear using areas and vicinity, while allowing a 
greater number of people to enjoy their country's park system and 
reducing costs substantially.
    Question. Under what authority has NPS adopted the policy of 
requiring registration of users going to the Brooks River area?
    Answer. Under the fee demonstration program that was authorized by 
the Omnibus Consolidated Rescissions and Appropriations Act of 1996 (P. 
L. 104-134).
    Question. What steps are involved in the registration process?
    Answer. Advance reservations can be made by calling Destinet, who 
is handling reservations for Katmai under the NPS reservation contract. 
The visitor or commercial operator can also pay the user fee and check 
in upon arrival at Brooks Camp if they prefer. For 1997, there is no 
cap on the number of people using the area.
    Question. Is registration provided through travel agencies for 
groups of tourists from outside Alaska?
    Answer. Yes, travel agencies have been advised that Destinet will 
make group reservations through them if they want. For example, Alaska 
World Tours, one of the biggest travel agencies in Alaska, is up-to-
date on the reservations system and is utilizing it. If a client of a 
travel agency does not use Destinet's service, they are still able to 
pay their fee upon arrival.
    Question. Have the access needs and use patterns of Alaskans been 
considered in establishing registration procedures?
    Answer. Yes; the development concept plan examined the following 
areas in establishing the reservation system: historic day use patterns 
at Brooks Camp, Limits of Acceptable Change (defining when visitor 
impacts have reached unacceptable limits for the visitor--the Limits of 
Acceptable Change study indicated that increasing visitor numbers were 
having a negative impact on the quality of the visitor experience), 
numbers of bear/human interactions per year, and local visitor use of 
the Brooks Camp area. Special allowances have been made for the local 
private visitors from the villages near Katmai.
    Question. Is NPS intending to restrict visitor access to the Brooks 
River Area in any manner this summer?
    Answer. No, NPS does not intend to restrict access to the Brooks 
River area this summer.
    Question. If so, how have affected Alaskan interests, e.g., 
concessionaires, the State of Alaska, pilots, and anglers, been 
notified?
    Answer. Even though no day use restrictions are in place for 1997, 
NPS has been working with affected Alaska interests to gather input and 
provide adequate advance notice of the 1998 day use regulations. The 
results of over eight years of meetings, drafts, and input were 
included in the development concept plan. In addition, four meetings 
for commercial operators were conducted in May and June of 1997: one in 
Homer, two in Anchorage, and one in King Salmon. The goal was to get 
input from the operators regarding implementation of the day use limit 
and reservation system for 1998.
    Question. Why is NPS willing to spend $9 million on tearing down 
one facility and moving it a relatively short distance away without 
first trying a more extensive boardwalk system to handle the bear 
viewing day users?
    Answer. The issue and the development concept plan focuses on other 
issues than visitor use. Brooks Camp is on top of a major 
archaeological site which is a national historic landmark and listed on 
the National Register of Historic Places. This site contains human 
burials, subterranean dwellings, and significant ethnographic resources 
for Native Alaskans. The NPS wants to be sensitive to this important 
cultural resource. Operation and maintenance of NPS and concessionaire 
facilities continues to cause resource degradation of these cultural 
sites. In addition, the campground is located in a major bear travel 
zone, which impacts visitor safety. The new site does not include 
critical bear habitat or potentially significant archaeological sites. 
The current location would not have been selected had there been 
awareness of the cultural sensitivity of the area. Additionally, there 
is considerable cost associated with maintaining the aging 
infrastructure and protecting the archaeology in the current location.
    Question. Why would visitor caps include persons not there for bear 
viewing?
    Answer. The visitor cap was established based on day use patterns 
and statistics gathered over the last several years. These statistics 
represented all day users to the area and were not separated according 
to type of use such as fishing, bear viewing, or photography. The 
average daily high for day use at Brooks Camp is about 110. However, 
due to inclement weather, some days reached peaks of 170 users which 
negatively impacted the visitor experience. All visitors to the area 
impact the visitor experience and the resources as identified in the 
Limits of Acceptable Change study portion of the development concept 
plan. The Brooks River corridor is less than 200 acres of land, and all 
park visitors, whether or not they are there for bear viewing, 
congregate in this small area.
                        kantishna mining claims
    When the Kantishna mining district was added to Denali National 
Park in 1980, the local miners received assurances that mining could 
continue. Just a few years later, environmental groups sued and the 
court imposed an injunction on mining until an EIS could be completed. 
Because it took NPS fours years to complete the study, many miners went 
bankrupt while they were prohibited from mining.
    This Subcommittee met in Alaska with the Kantishna miners in 1989. 
Because NPS refused to approve a single plan of operation allowing 
mining to continue, in fairness to the miners, I agreed to a buy-out 
plan to acquire the mining claims so the miners could get on with their 
lives.
    The U.S. Geological Survey (USGS) estimated that one family's 
claim, the Wieler brothers, was worth $4 million. Yet NPS appraised it 
at $200,000. Because $400,000 of reclamation work needed to be done, 
NPS said the family would have to PAY the Government $200,000 to sell 
its claim.
    It has now been nine years since this Subcommittee met with the 
Kantishna miners in Denali, but many of the claims are still 
unresolved. Over the past several months, my staff has met with your 
budget director, the NPS regional director in Alaska, your personal 
representative in Alaska, others on your staff, and anyone else who 
would listen about this case.
    On May 16 my staff was told that the case was just too complicated 
and no one knew what to do because the brothers were in bankruptcy. If 
your lawyers can't come up with a solution under existing law, I urge 
you to ask them to draft legislation that will resolve this matter.
    Question. Would you be willing to submit a recommendation to the 
Committee by July 1 which includes a fair appraisal process, so we may 
consider it in the fiscal year 1998 Interior bill?
    Answer. To the extent possible, the Department is interested in 
resolving the impasse that has been reached in our efforts to come to 
agreement with the owners of unpatented mining claims in Kantishna 
regarding the monetary value of their claims. Various ways of resolving 
this impasse include: (1) paying more than the appraised value of the 
claims, which is subject to Congressional review and approval; (2) 
having the courts decide what amounts constitute ``just compensation'' 
for these properties through a declaration of taking; and (3) enacting 
a legislative taking. Attempts to alter the appraisal process are not 
needed.
    For the record, the Department would like to summarize the history 
of mining claims in Kantishna.
    There are currently two bankruptcies in Kantishna. In the case of 
the Gold King claims, the bankruptcy was filed two years prior to the 
1985 court injunction, at a time when plans of operation submitted by 
Kantishna miners received inadequate regulatory review and routine 
approval by NPS. This bankruptcy was filed after many years of mounting 
debts and unpaid creditors. The other bankruptcy was filed several 
years ago by an individual who had received title to substantial 
amounts of patented acreage and who showed no recent interest in 
mining.
    Very few miners have submitted plans of operation to mine in 
Kantishna. Of the plans submitted, most have been so incomplete as to 
not allow NPS to evaluate them under the provisions of the Mining in 
the Parks Act. To date, two plans have been approved and one plan has 
been disapproved.
    In 1983, an estimate of value of the Kantishna claims was prepared 
by DOWL Engineers/Plangraphics, Inc., under contract to the U.S. Bureau 
of Mines. This report has been reviewed and found to be highly flawed 
in its methodology and estimates. The purpose of the DOWL report was 
not an appraised fair market value, and therefore did not follow 
accepted mineral appraisal standards. The NPS has subsequently 
contracted with a mineral appraisal firm respected in the mining 
industry. Using actual market transactions as the basis of their 
determinations, we believe they have prepared realistic estimates of 
the fair market value of the claims appraised.
    Industry respected environmental firms have surveyed the Kantishna 
claims for hazardous materials contamination. These firms have also 
prepared estimates of the costs to cleanup any contamination 
identified. These estimated cleanup costs are what it would cost for a 
professional firm to conduct the cleanups under contract. Most 
contamination on the claims in Kantishna consists of petroleum spills. 
It is recognized by NPS and the claimants that cleanups could be done 
by the claimants themselves or by other non-professionals for 
substantially less than the costs estimated by the environmental firms. 
Some claimants have now partially remediated the contamination on their 
claims, and additional efforts are underway to complete the cleanups. 
The NPS has reduced the costs of cleanup by paying the owners to remove 
personal property, including old batteries, barrels of hazardous 
materials, and other potential contaminants. Additionally, NPS has 
removed substantial amounts of debris from the entire Kantishna Hills 
area, further reducing the contamination problems on the mining claims.
    The Gold King claims are currently subject to bankruptcy 
proceedings and pending litigation. The Department does not believe it 
is possible to legislate a solution to this situation.
                                 ______
                                 
              Questions Submitted by Senator Thad Cochran
                     natchez national historic park
    It is my understanding that construction of the new visitor center 
at the Natchez National Historic Park will be completed during fiscal 
year 1998.
    Question. What additional operating costs will be required to 
support the National Park Service's (NPS) presence in this new 
facility?
    Answer. The amount that would be needed in fiscal year 1998 for a 
partial year is $121,000. The full year amount is $242,000.
    Question. Is this included in the President's Budget?
    Answer. The President's Budget contains numerous increases for park 
operations; however, at the time the budget was submitted to the 
Congress, this proposal was not included.
    Question. What additional staff requirements will exist for this 
new facility?
    Answer. The facility requires two FTEs.
    Question. Does the Park have sufficient FTE's to meet this need?
    Answer. The NPS has sufficient FTEs to meet this need; however, any 
FTE requirements are contingent on available funding.
    Question. Does the President's Budget include the allocation of 
these additional staff years?
    Answer. The President's Budget would provide two additional FTEs to 
the park, but for a different purpose.
    Question. What funds would be necessary to ensure adequate access 
by the physically challenged at the Park?
    Answer. Natchez National Historical Park has requested a study by 
National Center for Accessibility at the University of Indiana for a 
comprehensive Accessibility Plan. Until the study is complete, the 
amount of necessary funding is unknown.
    Question. Does the President's Budget include funds to do so?
    Answer. The President's Budget did not include such funding.
    Mr. Secretary, I know substantial funds are being spent on some 
big, expensive, new projects in Florida and California, and I hope our 
60 year effort to complete the Natchez Trace Parkway will not be 
forgotten or delayed in the excitement over these other initiatives.
    Question. What are the plans of this Administration for the 
completion of our historic and scenic Parkway?
    Answer. Good progress has been made in completing the Natchez 
Trace, and the Parkway is complete in the States of Tennessee and 
Alabama. At the present time, only 12 of 444 miles remain to be 
completed, about eight miles near Jackson, Mississippi, and about four 
miles near Natchez, Mississippi. The current construction estimate for 
completing these two sections is $62.1 million dollars. The financial 
scope of Parkway construction has made it difficult to accommodate it 
as a priority within the normal line item construction program for NPS. 
We are encouraged by the inclusion of a provision to give priority to 
completing legislatively mandated roadways such as the Natchez Trace in 
the Administration's proposed Federal Lands Highway Program section for 
the ISTEA reauthorization.
    There has been substantial interest over the last few years for the 
development of a trail to run alongside the Natchez Trace Parkway. The 
legislation which established the Parkway included this trail in its 
original plans.
    Question. What steps has NPS taken to establish this trail, as 
authorized?
    Answer. In 1994, Congress directed NPS to consider the need for a 
bicycle/mixed use trail within the Parkway's boundary in the Jackson, 
MS metropolitan area. However, the development of such a trail is 
conditional if such a trail could be included without significantly 
increasing the cost of Parkway construction.
    In response, NPS prepared and issued a Multi-Use Trail Study in 
1996, concluding that a 21 mile multi-use trail could be developed on 
Parkway lands from near Interstate-20 to a point along Ross Barnett 
Reservoir. This trail would be separate from the Parkway motor road and 
would seek to include provisions for linkages with other bicycle and 
similar trails that may be developed by the State, surrounding 
counties, or cities. The NPS identified the time-frame for construction 
of the multi-use trail as contingent upon appropriations and 
opportunities for partnerships with local governments, organizations, 
sponsors, and individuals.
    One such collaborative effort is nearing fruition. The NPS has been 
working since mid-1996 in a formal partnership with the City of 
Ridgeland, MS to design and construct, at no cost to NPS, the initial 
two mile segment of the multi-use trail with funding obtained by the 
City by virtue of an ISTEA grant. The enthusiasm the City of Ridgeland 
has shown in working with NPS to develop and maintain this segment of 
the multi-use trail demonstrates the level of involvement and 
commitment that are decisive in advancing this type of quality outdoor 
recreational opportunity for residents in the Jackson metropolitan 
area. The NPS plans to highlight the anticipated accomplishments from 
this partnership in an effort to stimulate similar local community-
Parkway trail project collaboration, especially since this may afford 
additional ISTEA funding for trail construction pursuant to requests by 
local government.
    The initial two mile segment of the multi-use trail, which is about 
to be developed, corresponds with a substantial portion of the priority 
trail segment identified in the NPS 1996 Study. This segment was 
assigned its priority in order to resolve existing conflicts between 
heavy motor vehicle traffic and bicyclists sharing the Parkway motor 
road between Interstate-55 and Old Canton Road.
    Question. What studies have been conducted to ascertain whether a 
detached or attached trail would be most feasible, cost effective, and 
useful to potential users?
    Answer. In 1996, NPS addressed the question of augmenting the 
standard 22 foot paved width of the Parkway motor road with paved 
shoulders to accommodate bicycle and other recreational trail uses. The 
evaluations concluded that paving the roadway shoulders would 
constitute an inappropriate departure from the Parkway's design 
integrity and historic landscaped character. However, NPS also 
evaluated separate options related to a continuous multi-use trail, as 
well as a segmented multi-use trail. While both of these options are 
feasible, there are high costs associated with such construction.
    In the past, this Subcommittee has endorsed the construction of the 
trail as part of new parkway construction when feasible.
    Question. What construction has taken place in compliance with this 
report language?
    Answer. The NPS has been working to coordinate future construction 
funding requirements for the Parkway motor road with those for parallel 
portions of the proposed multi-use trail. The NPS has moved to 
incorporate the multi-use trail as part of the major unconstructed 
Parkway motor road bridges being planned for the Interstate-55 to 
Interstate-20 section of the Parkway by widening these structures to 
carry the trail adjacent to one side of the Parkway motor road. The 
portion of the proposed multi-use trail north of Interstate-55 cannot 
be included in corresponding Parkway motor road construction funding 
requests since this portion of the Parkway already exists. Separate 
funding plans would be necessary for this portion of the multi-use 
trail or the funding could be provided where local governments are 
willing to act as a sponsor, in collaboration with the NPS, in seeking 
alternative sources of funding.
                       fish and wildlife service
    Question. In relation to water resource development projects in the 
Lower Mississippi Valley, please summarize the specific role of the 
Fish and Wildlife Service (FWS) throughout the planning, coordination, 
draft proposal, and final proposal stages of the environmental, 
economic, and engineering documentation prior to project construction. 
Please list all official responsibilities, and specific authorization 
or mandates in the law to do so.
    Answer. The Fish and Wildlife Coordination Act (FWCA) authorizes 
FWS to provide assistance to, and cooperate with, Federal, State, and 
public and private agencies and organizations in development, 
protection, rearing and stocking of wildlife resources and their 
habitats. Under the FWCA, Federal agencies that construct, permit or 
license water resources development projects must consult with FWS 
regarding impacts to fish and wildlife resources, and to ensure that 
these resources receive equal consideration.
    The FWS is authorized to conduct surveys and investigations to 
determine possible impacts to fish and wildlife resources and to make 
recommendations to prevent the loss of, or damage to such wildlife 
resources. The FWS is currently involved in coordination on over 20 
Federal water projects in the lower Mississippi River Valley. These 
projects, planned and constructed by the Corps of Engineers, are in 
various phases of development, ranging from the reconnaissance stage to 
project construction.
    To the extent allowed by Federal construction agencies, FWS 
participates in the formulation and evaluation of project alternatives. 
Under the National Environmental Policy Act (NEPA), the lead agency 
develops an environmental assessment or an environmental impact 
statement disclosing the project's impacts to environmental resources. 
The FWS is usually requested to be a cooperating agency in the 
preparation of the documents. As part of the interagency coordination 
procedures, the FWS also reviews and comments on all project and NEPA 
documents.
    I am interested in the formal relationship between FWS and the 
Lower Mississippi River Conservation Committee (LMRCC).
    Question. Please outline the formal agreement between the two 
entities, the mission statement of the LMRCC, and the membership 
composition. Please provide the Committee with the routine function 
which FWS performs as a result of the formal arrangement with LMRCC, 
including a breakdown of any funds utilized from FWS for the operation 
of the Commission.
    Answer. The ``History and Proceedings of the First, Second, and 
Third Annual Meetings of the Lower Mississippi River Conservation 
Committee'' and the Cooperative Agreement between FWS and the LMRCC is 
provided separately. The FWS provides a full-time coordinator and part-
time budget analyst to the LMRCC. The LMRCC is governed by an Executive 
Committee comprised of one representative from each of the following 
agencies: Arkansas Department of Pollution Control and Ecology, 
Arkansas Game and Fish Commission, Kentucky Department of Fish and 
Wildlife Resources, Louisiana Department of Environmental Quality, 
Louisiana Department of Wildlife and Fisheries, Missouri Department of 
Conservation, Missouri Department of Natural Resources, Tennessee 
Department of Environment and Conservation, and Tennessee Wildlife 
Resources Agency. The FWS provided $97,000 to the LMRCC for its 
operation. An additional $20,000 was also provided for the one time 
cost of the ``1996 LMRCC/USFWS Fisheries Management Plan Cooperative 
Agreement''.
    [Clerk's note.--Due to its volume, the above mentioned material is 
being retained in subcommittee files.]
 are all states throughout the lower mississippi river members of lmrcc
    It is the Committee's understanding that not all States throughout 
the Lower Mississippi River are members of LMRCC.
    Question. If this is so, could the agency please explain the 
background and reason on behalf of a lack of participation by any 
State. Please provide official documentation.
    Answer. The States of Arkansas, Kentucky, Louisiana, Missouri, and 
Tennessee are members of the LMRCC. The Mississippi Department of 
Wildlife, Fisheries and Parks and the Mississippi Department of 
Environmental Quality withdrew from the Committee on September 16, 
1996. Letters provided to Senator Cochran under separate cover outline 
the reasons for their withdrawal.
    [The letters follow:]
                         Letter From Sam Polles
                Mississippi Department of Wildlife,
                                       Fisheries and Parks,
                                     Jackson, MS, January 11, 1996.
Re MDWFP and LMRCC.

Mr. Edwin Crowell,
Chairman, Lower Mississippi River Conservation Committee,
Vicksburg, MS.
    Dear Mr. Crowell:  The Mississippi Department of Wildlife, 
Fisheries and Parks (MDWFP) thanks you and Mr. Nassar for your visit 
with us on December 4, 1995, to discuss LMRCC policy and MDWFP's 
participation and contribution to LMRCC. We support your proposed 
amendment to LMRCC's constitution by the addition of item 5 requiring 
unanimous approval of the organization's positions on public works 
projects within member states. MDWFP appreciates the mutual 
acknowledgment of the importance and correctness of balancing economic 
and environmental issues, and we also value the opportunity to preview 
the newsletter prior to publication for controversial topics in order 
to allow us and other members a chance to offer views within the 
newsletter.
    Effective upon receipt of this letter, Mr. Gary Lucas, Fisheries 
Biologist, will not represent MDWFP on the LMRCC executive committee, 
Fisheries Technical Section, or as Secretary/Treasurer. This is a 
mutual decision between Mr. Lucas and MDWFP. Mr. Lucas is a valued 
employee and his abilities are recognized and needed on other 
assignments. The MDWFP will be represented on the Executive Committee 
by Mr. Wayne Watts, P.E., Environmental Affairs Director. Mr. Ron 
Garavelli, Fisheries Director, will represent MDWFP on the Fisheries 
Technical Section.
    We look forward to working with all members of the LMRCC to 
continue to improve the organization's role as a technical resource for 
identifying problems and solutions necessary to our environmental and 
economic well-being. If you have any questions or comments, please do 
not hesitate to contact us.
            Sincerely,
                                                Sam Polles,
                                                Executive director.
                                 ______
                                 
            Letter From James I. Palmer, Jr., and Sam Polles
                              State of Mississippi,
                       Department of Environmental Quality,
                                     Jackson, MS, January 26, 1996.
Mr. Edwin F. Crowell,
Chairman, Lower Mississippi River Conservation Committee,
Vicksburg, MS.
    Dear Mr. Crowell: Subsequent to our meetings with you and Mr. 
Nassar, we have evaluated the mission of the Lower Mississippi River 
Conservation Committee (LMRCC) and the State of Mississippi's role in 
this committee. We believe that the LMRCC can serve an important 
function as a mechanism for information exchange and cooperation among 
the states along the river. This would result in more efficient use of 
funds to protect and improve the fishery resource, conduct monitoring 
programs, and provide more effective protection of the water quality of 
the Mississippi River. However, we feel strongly that the LMRCC should 
not be a policy-forming organization. It would be difficult, if not 
impossible, for Executive Committee members to vote on policy 
resolutions regarding issues which their state may have to contend with 
in the regulatory arena.
    Another area of concern we have is the Cooperative Agreement 
between the U.S. Fish and Wildlife Service and LMRCC which established 
a full-time coordinator for LMRCC. We suggest that the LMRCC would be 
better served if the Fish and Wildlife Service would enter into an IPA 
agreement with a LMRCC member state agency and place the LMRCC 
coordinator in that agency, thereby making it clearer that the LMRCC is 
independent of the U.S. Fish and Wildlife Service.
    It is our belief that these changes would cause the organization to 
better serve the interests of all of the member states.
            Sincerely,
                                   J.I. Palmer, Jr., Director,
                               Department of Environmental Quality.
                                   Sam Polles, Ph.D.,  Director,
                       Department of Wildlife, Fisheries and Parks.
                                 ______
                                 
                    Letter From James I. Palmer, Jr.
                              State of Mississippi,
                       Department of Environmental Quality,
                                   Jackson, MS, September 16, 1996.
Mr. Bennie J. Fontenot, Jr.,
Chairman, Lower Mississippi River Conservation Committee,
Vicksburg, MS.
    Dear Mr. Fontenot: We have delayed writing you in the hope that 
some additional discussions might be had among the leadership of the 
Lower Mississippi Conservation Committee to deal with concerns we 
raised at the beginning of the year regarding the focus and direction 
of the LMRCC. It appears that no further consideration of our concerns 
will be forthcoming, so we are writing to express to you our final 
sentiments in the matter.
    First, as we expressed to Ron Nassar when he met with 
representatives of our two agencies many months ago, the fundamental 
concept of the LMRCC is sound. While most of us are so strung out in 
our efforts to participate in a host of organizations and really do not 
need others to join, we recognize the reality that occasionally 
somebody does develop ``a better mouse trap,'' and we should be 
openminded to such possibilities. As a consortium of specialists in 
various fisheries and related fields which can then bring these skills 
to bear in a very focused way in various projects and initiatives 
throughout the Lower Mississippi region, the LMRCC has promise. 
Moreover, Ron stated his specific goal of having the LMRCC emerge as a 
``consensus broker'' when particular projects or research efforts hit a 
snag and contentions arise. This, too, is a worthy ambition. The 
reality of the matter, however, is that when any group adopts a 
``policy position'' in a contentious matter, the group automatically 
becomes an advocate for one position or another. This, in turn, 
generally means that others who do not agree with this particular 
position are automatically made adversaries to it. Thus, we see little 
hope for the LMRCC to simultaneously be both an advocate and a 
consensus broker.
    Additionally, the Department of Environmental Quality is 
responsible for handling Section 401 water quality certifications 
throughout Mississippi. Contested matters are elevated to our 
Commission on Environmental Quality for final disposition. Whenever a 
no-discharge or discharge NTPDES permit is associated with projects 
these matters must be handled by our Environmental Quality Permit 
Board, one statutory member of which is a representative of the 
Department of Wildlife, Fisheries and Parks. Neither the Department of 
Environmental Quality nor the Department of Wildlife, Fisheries and 
Parks can participate in an organization which adopts policy 
resolutions regarding particular projects (thus becoming, as we have 
said, an advocate) while simultaneously attempting to comply with 
federal and state ``arbitrary and capricious'' standards for final 
administrative decisions. Any policy position we would take would 
automatically, and probably conclusively. impeach our ultimate 
regulatory decision in such matters. We simply are not going to run 
such risks.
    Another concern we discussed with Ron personally is the perception 
that the U.S. Fish and Wildlife Service is ``officially'' the 
administrative leader of this effort. We well understand that Ron has 
been given substantial latitude in committing his time to the LMRCC and 
that he works hard to develop his role accordingly. However, this will 
be extremely difficult for him to do as long as he goes to work every 
day at his traditional U.S. Fish and Wildlife Service duty station and 
``wears the uniform,'' as it were. We suggested that both the LMRCC and 
Ron would be much better served if the Fish and Wildlife Service would 
enter into an Intergovernmental Personnel Act (IPA) Agreement with the 
LMRCC so that Ron could be given appropriate ``detachment.'' 
Unfortunately, we are advised that this particular concern of ours has 
received no attention.
    After we wrote you, the LMRCC Executive Committee considered our 
first concern at their annual meeting in February, but stopped short of 
a by-laws revision to remove the policy-forming function earlier 
embraced by the group. As mentioned, Ron remains in the lurch he has 
been in from the beginning. We strongly feel that these aspects of 
LMRCC structure and function are major impediments to its ultimate 
success and we have determined that our further affiliation with the 
organization cannot be productive in light of these unresolved 
concerns.
    With reluctance, we request that you remove the names of our 
respective agencies from your roster of members. If the LMRCC members 
decide to reshape their by-laws in the future to allow them to become 
what we believe the organization can truly be without shackling itself 
as it has, we will be happy to once again discuss with you possible 
membership.
            Sincerely,
                                   J.I. Palmer, Jr., Director,
                               Department of Environmental Quality.
                                   Sam Polles, Ph.D.,  Director,
                       Department of Wildlife, Fisheries and Parks.

    Question. The Committee would like to know whether there have been 
any instances in the past, or if there are opportunities in the future 
for the agency, or agency personnel through formal arrangement such as 
the Lower Mississippi River Conservation Committee, to establish a 
position of advocacy or opposition to other Federal programs or 
projects which affect the human health, environmental, or general 
welfare of the people of the Lower Mississippi River Valley region. 
What safeguards or policies exist within the agency to ensure that 
third party relationships such as the LMRCC-FWS arrangement does not 
result in the agency becoming engaged in activities which are otherwise 
reserved for the National Environmental Policy Act process or the Fish 
and Wildlife Coordination Act process?
    Answer. There have been no instances in the past where FWS has 
advanced policy through a formal arrangement with an organization such 
as the LMRCC. The FWS believes that there are no opportunities for such 
an action to occur in the future. As outlined in the ``Resolution on 
Mississippi River Training Work'' which is provided to Senator Cochran 
under separate cover, the LMRCC did not establish a position of 
advocacy or opposition to any Federal program or project which affected 
the human health, environmental, or general welfare of the people of 
the Lower Mississippi Valley Region. However, the LMRCC did request in 
its resolution that its members be allowed to provide ``early and 
effective input,'' as provided by U. S. Army Corps of Engineers policy, 
into the project design in order that damages to the natural resources 
at risk could be minimized.
    Although FWS is a cooperator in the LMRCC, our participation is not 
increased in NEPA and FWCA processes. The FWS is not a voting member in 
the organization's operation. No safeguards or policies are necessary 
because the FWS, as legislatively authorized, routinely participates in 
NEPA and FWCA activities.
    [The information follows:]
             Resolution on Mississippi River Training Work
    Whereas, the Mississippi River provides important habitat for a 
diverse assemblage of river-dependent species that provide important 
recreational and commercial opportunities; and
    Whereas, habitat provided in the river ecosystem is essential for 
the existence of the federally listed interior least tern (Sterna 
antillarum athalassos) and pallid sturgeon (Scaphirhynchus albus); and
    Whereas, The U.S. Army Corps of Engineers is charged with 
responsibilities for providing a navigation channel, flood control, and 
other river-focused societal benefits that can impact riverine habitat; 
and
    Whereas, river training structures, such as dikes and revetments, 
that are important in channeling the river into a usable navigation 
channel can potentially alter flow patterns and impact riverine 
habitat; and
    Whereas, the U.S. Army Corps of Engineers has provided for limited 
involvement of outside interests, including fish and wildlife 
interests, in planning for and implementation of their river training 
efforts; and
    Whereas, state fish and wildlife agencies from the states of 
Arkansas, Kentucky, Louisiana, Mississippi, Missouri, and Tennessee, 
which are represented on the Lower Mississippi River Conservation 
Committee, and our federal counterpart, the U.S. Fish and Wildlife 
Service, need to be actively involved in the planning of river training 
structures;
    Now, therefore, be it resolved that, the Lower Mississippi River 
Conservation Committee assembled at its annual meeting on January 25, 
1995 in Paducah, Kentucky urges the U.S. Army Corps of Engineers Lower 
Mississippi Valley Division and its St. Louis, Memphis, Vicksburg, and 
New Orleans District Offices to initiate measures that will provide for 
early and effective input from the state fish and wildlife agency 
members of the Lower Mississippi River Conservation Committee and the 
U.S. Fish and Wildlife Service to assure that consideration of the 
long-term effects of river training structures on riverine habitat are 
included in the planning process, that river training structures be 
designed to retain and enhance riverine habitats. and that the dynamics 
of the Mississippi River be retained wherever possible.
                         lmrcc-fws relationship
    Question. In your review of the matter, have there been any 
instances when the LMRCC-FWS relationship contributed to the perception 
that the agency was advancing, or participating in the advancement of 
policy, rather than performing the functions outlined in the joint 
agreement between LMRCC and FWS?
    Answer. The FWS periodically briefs the LMRCC in formal meetings 
when a request is made. The authority for the FWS to undertake this 
action is found in the Cooperative Agreement between FWS and the LMRCC. 
Our review of the guidelines of the Cooperative Agreement indicates 
that the relationship between FWS and the LMRCC has not fostered the 
perception that the agency was advancing or participating in the 
advancement of policy, rather than performing its mandated functions.
    Question. The Committee would like to request copies of any 
official publications, newsletters, correspondence, or other 
informational pieces which have been developed or distributed by FWS 
personnel as a result of the FWS agreement with LMRCC. It would be 
helpful if FWS would provide the Committee with these publications or 
newsletters since the formation of the LMRCC.
    Answer. The requested information is provided under separate cover 
to Senator Cochran.
    [Clerk's note.--Due to its volume, the above mentioned material is 
being retained in subcommittee files.]
                        yazoo basin, mississippi
    Question. The Committee is aware that FWS has demonstrated a keen 
interest in the Yazoo Basin, Mississippi projects, including but not 
limited to the Mississippi River Levee Enlargement Project, the Big 
Sunflower River Maintenance Project, and the Yazoo Backwater Project. 
Relative to these projects and the role of FWS in these activities, the 
Committee would like to submit the following questions.
    Answer. Under provisions of FWCA and NEPA, FWS has an interest in 
all water resource development projects throughout the entire Nation, 
not just those projects within the Yazoo Basin of Mississippi, that may 
have damaging effects to fish and wildlife resources. Our Mitigation 
Policy provides guidance in methods and alternatives to avoid, reduce, 
minimize, and/or compensate for damages to fish and wildlife resources 
adversely impacted by Federal projects.
    Question. Did a FWS staff person prepare, develop, and/or 
distribute the white paper relative to the Big Sunflower River 
Maintenance Project which was entitled, ``A Biological Tragedy in the 
Making: The Big Sunflower River, Mississippi?'' If so, what documents 
and data sources or scientific publications were used to develop this 
white paper? Was this white paper printed or distributed at the expense 
of the Federal Government? Further, is there any provision in the Fish 
and Wildlife Coordination Act or the NEPA process which encourages or 
discourages this type of information?
    Answer. The sources of information for the white paper entitled ``A 
Biological Tragedy in the Making: The Big Sunflower River, 
Mississippi'' were two documents produced by the Corps of Engineers' 
Waterways Experiment Station. These citations are:
    Hoover, J.J., and K.J. Killgore. 1993. Impacts of the Big Sunflower 
River maintenance project on fishes and fish habitat. Report prepared 
for U.S. Army Engineer District, Vicksburg. Waterways Experiment 
Station, Vicksburg, MS.
    Miller, A.C. and B.S. Payne. 1993. An analysis of freshwater 
mussels (Unionidae) in the Big Sunflower River, Mississippi: 1993 
studies. Report prepared for U.S. Army Engineer District, Vicksburg. 
Waterways Experiment Station, Vicksburg, MS.
    These documents were provided to the Endangered Species Committee 
of the American Fisheries Society (AFS) by the FWS Jackson, MS Field 
Office in response to a general request for information on threats to 
freshwater mussels in the Southeast. This committee is composed of 
academia and research scientists, including Federal biologists, from 
across the Nation. The FWS staff did not prepare or develop the white 
paper. Other than forwarding copies of the white paper that was 
received by the Jackson Field Office to others in the FWS for their 
information, the white paper was not distributed at Government expense.
    A primary role of FWS under both NEPA and FWCA is to provide 
biological review and information to Federal action agencies relative 
to specific Federal projects and their potential biological impacts. 
Because of its role in reviewing projects under FWCA and NEPA, FWS is 
often requested to provide the same or similar information to others, 
including research organizations, State agencies, nongovernmental 
organizations, and individuals. As a public agency, FWS feels obligated 
to respond to all legitimate requests for information by citizens of 
the United States, and neither NEPA or FWCA discourage this practice.
    Question. Has the agency strictly adhered to the policies of 
interagency coordination relating to the three projects listed above?
    Answer. The FWS has provided information about fish and wildlife 
resources as requested by the action agency, the local sponsor, and 
other interested parties.
    Question. Has the agency initiated meetings, communications, or any 
actions which affect the three Congressionally-authorized water 
resources projects mentioned above, without coordinating these 
activities with the local sponsor and/or the U.S. Army Corps of 
Engineers? If the answer is yes, please explain the justification for 
these actions and outline the specific provisions in FWCA and NEPA 
which support these actions?
    Answer. A primary role of FWS under both NEPA and FWCA is to 
provide biological review and recommendations to Federal action 
agencies relative to specific Federal projects and their potential 
biological impacts. Because of this role, FWS is often requested to 
provide its views to others, including research organizations, State 
agencies, nongovernmental organizations, and individuals. As a public 
agency, FWS feels obligated to respond to all public requests for 
information, and neither NEPA or FWCA discourage this practice. After 
extensive coordination with the Corps, FWS provided information on the 
status and potential impacts of the Mississippi River Levee Enlargement 
Project to various organizations in Mississippi, Louisiana, and 
Arkansas, as requested. The FWS coordinated its economic study of the 
Big Sunflower River Maintenance Project with the local sponsor and the 
Corps by providing them with copies of the contract and inviting them 
to meetings with the FWS contractor.
    Question. Has the agency coordinated its input and concerns 
relative to the three projects mentioned above with the local sponsor? 
When? In what way?
    Answer. The FWS has provided the Corps and local sponsor written 
responses at all stages of the scoping, planning, and construction 
where our input was requested. Coordination with the Corps and/or the 
local sponsor has varied depending upon where the project is in regard 
to planning and/or construction. For example, some work items for the 
Mississippi River Levee Enlargement projects are currently under 
construction, while other items are still in the planning stage. The 
Big Sunflower River Maintenance Project is in the late stages of 
planning and the Yazoo Backwater Project is in the early stage of 
planning. Less coordination has occurred between FWS and the local 
sponsor on the Yazoo Backwater Project because it is in the early 
planning stage. The FWS and the local sponsor have coordinated on 
numerous occasions since 1995 concerning the Big Sunflower and the 
Mississippi River Levee projects. The local sponsor met with the Region 
4 Regional Director, in October 1995, to discuss the Big Sunflower 
River maintenance project. The sponsor also reviewed our letter 
summarizing the FWS position on the project prior to the finalization 
of the FWS letter. Many meetings were held between FWS and the Corps 
where the local sponsors were present, to include the Corps' annual 
high water and low water trips on the Mississippi River.
    Question. Has the agency assisted the local sponsor in identifying, 
avoiding, or minimizing adverse environmental impacts associated with 
these three projects mentioned above? Provide the Committee with 
correspondence, communications, or other records which represent 
assistance or dialogue between the local sponsor and the agency?
    Answer. As directed by the FWCA, FWS has been primarily involved 
with the Corps in identifying potential avoidance and minimization of 
impacts to natural resources associated with these water resources 
projects. The local sponsors participated in many meetings between the 
Corps and the FWS.
    [Clerk's note.--Due to its volume, the above mentioned material is 
being retained in subcommittee files.]
           alternative to congressionally-authorized projects
    Question. Has the agency ever offered an alternative to the 
Congressionally-authorized projects which would require additional 
authorizations or in any way alter the existing Federal responsibility 
for the construction or maintenance of the three projects listed above?
    Answer. The FWS has the responsibility to investigate all flood 
damage alternatives in cooperation with the Federal construction 
agency. The FWS offered a nonstructural alternative to dredging of the 
Big Sunflower River. It is unclear to FWS whether or not nonstructural 
features for the Big Sunflower River Maintenance project would require 
additional authorization. The FWS is developing an essentially 
nonstructural alternative for flood damage control in the Yazoo 
Backwater project. This alternative plan has not been completed, 
therefore, whether further Congressional authorization is needed is not 
known.
    It is my understanding that FWS has commissioned an economic 
analysis of the U.S. Army Corps of Engineers project entitled the Big 
Sunflower River Maintenance Project.
    Question. Under what authority was this study commissioned?
    Answer. The FWS has the authority and responsibility under FWCA and 
the Fish and Wildlife Act of 1956 to address the impacts of Federal 
water development projects on fish and wildlife resources. The FWS 
staff has worked diligently with the Corps to avoid the impacts 
resulting from the proposed Big Sunflower River Maintenance Project. 
The viability of nonstructural alternatives that would reduce flood 
damages while protecting fish and wildlife resources is important to 
the FWS. For that reason, FWS decided to conduct a more in-depth 
investigation of economics of this nonstructural alternative. The 
results could be used in the review and analysis of future flood 
management projects to develop environmentally and economically sound 
projects.
    Question. From what appropriated account will this project be 
funded?
    Answer. Economic analyses are funded through appropriations made to 
the Resource Management account, under the General Administration 
activity.
    Question. Why does FWS commission economic analyses? Is this not 
the charge of the Corps of Engineers? Why is the Corps of Engineers 
analysis inadequate?
    Answer. The FWS commissioned this economic study for two reasons. 
First, we have a national interest in exploring the methods used to 
determine the value of property in less-than-fee acquisition 
situations. With increasing public interest in private property rights, 
we are investigating the feasibility of alternatives which could 
safeguard private property rights and meet conservation needs. Since 
there are numerous applications of less-than-fee acquisition 
methodology, FWS is interested in evaluating these methods to determine 
minimum, but equitable, costs for purchasing individual property 
rights. This information has application for protecting endangered 
species on private lands, migratory bird program enhancements, and 
refuge land acquisition. The Big Sunflower River Maintenance project is 
a good case study of this issue. Second, FWS supported a nonstructural 
method of flood damage reduction which would reduce damages while 
protecting fish and wildlife resources. Therefore, FWS decided to 
conduct a more in-depth investigation of its economics for use in 
evaluating future flood management projects.
    Question. Was the economic analysis conducted by the Corps done in 
a manner which was different that the analysis performed on the 
Tallahatchie River Maintenance Project? If not, why did FWS not perform 
an economic analysis of that project?
    Answer. In working toward conservation of fish and wildlife and 
other natural resources, FWS investigates any aspect of a water 
development project, including economics. The FWS concentrates its 
efforts on those projects where significant resources are at risk. This 
was not the case in the Tallahatchie River, and FWS did not object to 
the Tallahatchie River Maintenance project. Consequently, FWS did not 
closely examine the Corps' economic analysis of that project. The 
natural resources of the Big Sunflower River are more valuable, which 
warrants a closer examination of the viability of any alternative, such 
as the nonstructural alternative, which would provide a high degree of 
protection for those natural resources.
    Question. Does FWS have sufficient information at its disposal to 
assess duck populations and study the impacts of changes in hunting 
season frameworks? What additional funds would be necessary, and for 
what purpose, to meet these unmet needs, if any exist?
    Answer. The FWS predicts about a 25-percent increase in duck 
harvest in those States extending season dates seven to ten days longer 
than currently allowed. However, this prediction is based on experience 
in only two States--Iowa (1979-87, 1994-95) and Mississippi (1979-84). 
A more definitive assessment of harvest impact would require a large-
scale regulatory experiment with adequate replication, experimental 
controls and randomization of treatments. Of more concern than adequate 
funding, is the question of whether a scientifically valid evaluation 
would be acceptable to the States, since about half of the States 
interested in framework extensions would have to agree to serve as 
experimental controls (i.e., no framework extensions) each year of the 
study. Moreover, there is a six to ten year timeframe for an adequate 
study and there could be no guarantee that the final results would 
support the use of framework extensions. Historically, it has been very 
hard to get broad-based agreement on an evaluation plan under these 
conditions.
    The Migratory Bird Treaty Act states that the open season on 
migratory birds is from September 1 to March 10. The Treaty also states 
that the Secretary of the Interior shall give due regard to ``temperate 
zones'' and ``times and lines of migratory flight'' in setting seasons.
    Question. Given this directive in the law, will a January 31 
closure, as recommended by the Lower Region Regulations Committee of 
the Mississippi Flyway Council, be listed for comment in the Federal 
Register? If not, why not?
    Answer. In the most recent Federal Register, FWS published the 
recommendations of the Mississippi and Central Flyways to extend 
framework dates beyond those currently used. The FWS also published a 
summary of all public comment received to date on the issue of 
framework dates. The FWS is not proposing to alter framework dates for 
the 1997-1998 season and is requesting further input from the Flyway 
Councils, States, and the public on a number of specific issues, such 
as potential for negative physiological impacts, possible changes in 
the size of the harvest, and reallocation of hunting opportunity within 
and among flyways. Comments will be accepted until June 27, 1997 and 
the final decision for the 1997-1998 hunting season will be published 
on or about July 15, 1997.
    The Administration's Budget proposes an increase of $1.8 million, 
or 12 percent, for the migratory bird management program to augment the 
FWS conservation and monitoring efforts for wild birds.
    Question. For what purpose will these additional funds be used? 
Please be specific, using FTEs and object classifications as 
appropriate.
    Answer. The President has proposed an increase of $1.5 million for 
the FWS migratory bird management program, specifically to enhance 
conservation and monitoring efforts for migratory birds at a region, 
national, and international scale. Of critical importance is monitoring 
and assessing the status of migratory bird populations to provide 
opportunities for recreational pursuits, such as bird-watching or 
hunting, and to ensure that significant declines in species are 
identified and reversed before reaching the status of threatened or 
endangered. A breakdown of this proposed funding initiative into 
specific project categories is as follows:
    Species of Management Concern (+$600,000): This increase would be 
used by FWS to focus on the highest priority monitoring and 
conservation actions. The FWS has primary responsibility for migratory 
nongame birds, and successful conservation of these species depends on 
reliable information on population status and trends.
    Goose Monitoring and Assessment (+$500,000): This increase would be 
used, in conjunction with ongoing Flyway efforts, to shift additional 
emphasis for goose management activities to key arctic and subarctic 
breeding areas, where information on status, habitat trends, and annual 
productivity has become increasingly important.
    Webless Species Monitoring and Assessment (+$150,000): The 
additional funds will be used, in conjunction with other initiatives 
such as the recently-created Webless Migratory Game Bird Research 
Program, to develop more reliable monitoring programs for various 
webless game bird species, and provide a better understanding of 
population dynamics and the role of different factors that influence 
population demographics and distribution.
    Sea Ducks, Mottled Ducks, and Whistling Ducks Monitoring and 
Assessment (+$80,000): This increase would improve estimates of 
population status and production through aerial and ground surveys of 
sea duck distribution and abundance, particularly in key breeding areas 
in arctic and subarctic regions of Alaska and northern Canada, and in 
migration and wintering areas along the Atlantic and Pacific coasts. 
This would also enable increased monitoring capabilities for mottled 
and whistling ducks on important nesting areas along the Gulf Coast.
    Harvest Information Program (+$170,000): This increase will help 
FWS to share ongoing Harvest Information program costs with the States 
in documenting the names and addresses of all licensed migratory bird 
hunters that are collected by the States, thus assuring the development 
of a more reliable and effective sampling frame for this critical 
survey.
    Waterfowl populations have made a significant recovery during the 
past several years, and this Administration has been quick to claim 
credit for this occurring. Favorable weather conditions and additional 
habitat in breeding, migration, and wintering areas have had a very 
positive impact on waterfowl populations. It is my understanding that 
because of these advances, seven of the 10 principal species of 
waterfowl surveyed are now above the goals specified in the North 
American Waterfowl Management Plan.
    On May 17, 1991, I received a letter from Thomas Dwyer, then the 
Chief of the Office of Migratory Bird Management, in response to a 
letter I submitted on behalf of a constituent concerning framework 
dates. Mr. Dwyer said the closing dates were advanced ``* * * in 
response to severe drought conditions on important duck breeding areas 
and low populations of most species.''
    Question. Now that these adverse conditions have subsided, please 
explain what conditions exist which would prevent a January 31 closing 
date.
    Answer. After a period of generally liberal hunting regulations 
during the 1970s and early 1980s, opening and closing framework dates 
(as well as season length and bag limit) were restricted during 1985-
1993 due to declining duck populations. In 1992, framework dates were 
returned to roughly October 1 to January 20, which generally were those 
used prior to the restrictions. The FWS notes, however, that 
Mississippi had an experimental closing date of January 31 during 1979-
84. The FWS believes that the question of appropriate framework dates 
now or in the future should not be predicated on current duck 
population status. Rather FWS has been working cooperatively with the 
Flyway Councils to develop an acceptable set of regulatory alternatives 
(i.e., specific combinations of season lengths, bag limits, and 
framework dates) and specific guidelines for their use (i.e., the 
process of adaptive harvest management). As with potential changes in 
season length and bag limit, changes to framework dates must be 
approached in a methodical and comprehensive manner, and with due 
consideration of both biological and sociological impacts. The FWS is 
not yet satisfied that all partners have had the opportunity to provide 
comments or are in agreement about the appropriate specification of 
framework dates.
    It is my understanding, through a letter from Acting Director John 
Rogers on August 2, 1996, that FWS, Flyway Councils, and States, that a 
comprehensive review of the regulatory alternatives has been conducted 
in preparation for the 1997 hunting season.
    Question. Please provide for the Committee a copy of this study, 
including the names of those involved in this review.
    Answer. Copies of the following are provided for the Committee: (1) 
a joint recommendation of all four Flyway Councils regarding 
development of regulatory alternative for ducks; (2) results of a mail 
survey of Flyway Council members regarding their opinions of duck 
hunting regulations; (3) a report from the adaptive-harvest-management 
technical working group, providing its recommendations for regulatory 
alternatives for ducks; and (4) a list of members of the technical 
working group.
    [Clerk's note.--Due to its volume, the above mentioned material is 
being retained in subcommittee files.]
                         harvest rates of ducks
    Question. Can the harvest rates of ducks accurately be measured? 
How?
    Answer. The annual harvests of ducks can be measured reliably 
through the FWS mail questionnaire and parts collection surveys. A 
sample of about 35,000 questionnaires each year provide an estimate of 
total duck harvest and about 100,000 wings sent in by hunters permit 
the harvest to be apportioned among species. The harvest rate, or that 
proportion of the fall-flight taken by hunters, can be estimated 
accurately only for mallards. The estimate of harvest rate is based on: 
(1) the proportion of banded birds shot and reported by hunters; and 
(2) the likelihood that a band encounter will be reported (referred to 
as the band-reporting rate). The band-reporting rate traditionally has 
been low (about 30 percent) and a program is underway to increase the 
rate. Because the band-reporting rate currently is changing, estimation 
of mallard harvest rates has become less reliable. A new study of band-
reporting rates is planned for 1999 or 2000, after which reliable 
estimates of harvest rate again will be available.
    Question. Are there scientific articles which have been published 
which would corroborate not allowing a January 31 closure date, 
particularly at current population levels?
    Answer. Yes, there are several scientific publications which imply 
that the late-winter period may be critical to subsequent reproduction 
and survival by ducks and that delays in pair formation or disruption 
of pair bonds during this period could affect future reproduction. 
However, it is not clear how disruptive hunting in late-January would 
be to ducks. Publications which demonstrate the importance of pairing 
to ducks include:
    Heitmeyer, M. E. 1985. Wintering strategies of female mallards 
related to dynamics of lowland hardwood wetlands in the Upper 
Mississippi Delta. Ph.D. dissertation, University of Missouri, 
Columbia.
  --Hepp, G. R., and J. D. Hair. 1984. Dominance in wintering waterfowl 
        (Anatini): effects on distribution of sexes. Condor 86:251-257.
  --Paulus, S. L. 1983. Dominance relations, resource use, and pairing 
        chronology of gadwalls in winter. Auk 100:947-952.
  --Paulus, S. L. 1984. Activity budgets of nonbreeding gadwalls in 
        Louisiana. Junior Wildlife Management 48:371-380.
    Question. Please provide a copy of the FWS Adaptive Harvest 
Management policy, including statistical formulas.
    Answer. Copies of the following are provided for the Committee: (1) 
its adaptive harvest management policy for the most recent hunting 
season; (2) a peer-reviewed article from a scientific journal that 
provides the complete mathematical and statistical description of 
adaptive harvest management for mallards; and (3) a journal article 
that provides a more general description of adaptive harvest 
management.
    [Clerk's note.--Due to its volume, the above mentioned material is 
being retained in subcommittee files.]
            maximize opportunity between and within flyways
    Question. If regulatory options can be adapted to maximize 
opportunity between flyways, why can't they be adapted to maximize 
opportunity within a flyway?
    Answer. Adaptive harvest management maximizes total harvest, while 
maintaining duck populations at or above the goals of the North 
American Waterfowl Management Plan. The allowable harvest is allocated 
among Flyways based on tradition extending back more than 40 years. In 
fact, the Flyway Councils have recommended that the allocation of 
harvests among Flyways should be maintained, at least in the short 
term. Decisions about how harvest should be allocated within a Flyway 
ultimately rest with the States involved. In the case of the 
Mississippi Flyway, at least two States (Minnesota and Wisconsin) are 
on record opposing a framework extension in southern States because it 
would further shift the distribution of duck harvest to the south. 
Northern States are mindful that the five southernmost States of the 
Mississippi Flyway collectively enjoy the highest hunter success of any 
region in the country. The FWS believes that allocation of harvest both 
among and within Flyways is a sensitive political issue that must be 
addressed in full consultation with all affected parties.
    The Land and Water Conservation Fund has provided $38.4 million to 
Mississippi since 1965. It is my understanding that under the law, 60 
percent of funds are to be allocated to States. Since 1988, States have 
received 10 percent or less. In the last two years, States have 
received no funds.
    Question. Why has funding not been allocated to the States during 
the last two years?
    Answer. During the past two fiscal years, no funds were 
appropriated by the Congress for the Land and Water Conservation Fund 
State grant program. Due to the lack of an appropriation, no funds were 
available to allocate to States.
    Question. How much does the Administration's Budget propose to 
allocate to States in fiscal year 1998?
    Answer. Because no funds have been appropriated for this program 
during the past two years, the Administration did not request funds for 
fiscal year 1998.
                                 ______
                                 
            Questions Submitted by Senator Pete V. Domenici
      level of funding for new mexico land acquisition priorities
    There are a number of projects within the purview of the Department 
of the Interior, primarily the National Park Service (NPS), which are 
nearing completion. For example, Congress has appropriated in excess of 
$20 million over the past seven years to acquire land from willing, and 
in some cases anxious, property owners within Petroglyph National 
Monument. Unofficially, NPS estimates that to complete land acquisition 
at the monument will require between $6 and $8 million. Other monuments 
and parks in New Mexico face similar needs, perhaps to a lesser extent, 
in order to complete initiatives that were begun some time ago. These 
include Aztec Ruins National Monument, Pecos National Monument, and 
several small initiatives within the Bureau of Land Management (BLM) 
that will consolidate land holdings in specified areas of concern.
    There are a number of Wilderness Study Areas on BLM land within New 
Mexico, where there are significant inholdings. Many in New Mexico 
would like to begin the process of developing a BLM wilderness bill to 
try to resolve this issue for some time into the future. I am 
concerned, however, that the record of the Department of the Interior 
in completing projects before moving on to a new ``priority'' will 
undoubtedly hinder this process.
    Question. When does the Department of the Interior foresee 
completion of acquiring inholdings within the National Monuments and 
Parks within New Mexico?
    Answer. Completion of acquisitions is contingent on the 
availability of funds. Though acquisitions in the New Mexico units are 
among the NPS priorities, the fiscal year 1998 budget request for the 
NPS land acquisition program includes no funds for acquisition in the 
New Mexico units. Identified future acquisitions in New Mexico units of 
the National Park System are as follows:

                                           ACQUISITIONS IN NEW MEXICO                                           
                                             [Dollars in thousands]                                             
----------------------------------------------------------------------------------------------------------------
                                                                                                     Estimated  
                            Park unit                                 Tracts           Acres           value    
----------------------------------------------------------------------------------------------------------------
Aztec Ruins NM..................................................              12              45          $1,000
El Malpais NM...................................................              42           4,272           2,800
El Morro NM.....................................................               2             239             234
Pecos NHP.......................................................              37             442           2,501
Petroglyph NM...................................................             120             709           8,000
Salinas Pueblo Missions NM......................................               5               9              50
                                                                 -----------------------------------------------
      Totals....................................................             218           5,716          14,585
----------------------------------------------------------------------------------------------------------------

    Question. Will the Department of the Interior support additional 
land acquisition commitments within New Mexico before the completion of 
the current obligations for acquisition?
    Answer. The Department does not support additional funds for any 
program or project which would result in the reduction of funding for 
priority programs included in the budget request. However, in general, 
completion of identified existing projects have priority over new 
projects. However, flexibility to respond to unique acquisition 
opportunities should be maintained, particularly for those projects 
that are time sensitive, and where the opportunity to acquire lands 
with significant resource/recreation values may be available and lands 
are under the threat of development.
    department of the interior--funding for the southwest fisheries 
                           technology center
    The Southwest Fisheries Technology Center (SFTC) has received the 
support of this Subcommittee since 1993 as one of the highest 
priorities within Region 2 of the Fish and Wildlife Service (FWS), and 
to date Congress has appropriated $20 million for construction of 
facilities at Dexter and Mora in New Mexico. When completed, the SFTC 
will be the only facility in the Nation dedicated exclusively to the 
breeding and stocking of native, threatened, and endangered fish. 
Approximately $6 million is needed to complete construction and provide 
funding for the two units of the SFTC to become operational.
    Question. Why has this Administration not requested funding to 
complete construction at the SFTC in any of the last five years?
    Answer. In fact, the fiscal year 1997 President's Budget requested 
$3.7 million for the Southwest Fisheries Tech Center.
    Ongoing priorities have included health and safety construction 
projects and completion of the National Conservation and Training 
Center. For fiscal year 1998, the President's Budget has focused on 
backlog reductions, including for example a request for construction 
funding totaling $22.2 million for the highest priority infrastructure 
backlog needs including the rehabilitation of roads, dams, and bridges 
in the National Wildlife Refuge system and $5.3 million for 
rehabilitation projects in the National Fish Hatchery system.
    Question. Does the Department support the completion of 
construction, and subsequent staffing and operation of the SFTC?
    Answer. Each construction project has to be considered relative to 
program priorities, especially the health and safety of our employees 
and the public.
    Question. Does the Department ever plan to request adequate funding 
for operation of the SFTC?
    Answer. The Department will reevaluate the project in future 
budgets against all other priorities.
          department of the interior--payment in lieu of taxes
    Under section 1033 of the Omnibus Parks and Public Lands Management 
Act of 1996, the Department of the Interior is authorized to recognize 
boroughs and other subdivisions as units of local government for the 
purposes of the Payment in Lieu of Taxes (PILT) program. This has added 
an additional obligation of $6.5 million under this program, yet the 
Administration has requested a reduction of $12 million in this program 
that is vitally important for local governments to provide services in 
those areas where local tax base is limited by the presence of Federal 
land. This level of funding is below that appropriated in fiscal year 
1994, before Congress authorized an increase in the program.
    Question. Does the Administration believe that the needs of local 
governments are less than they were in fiscal year 1994?
    Answer. No, the Administration does not believe that the needs of 
local governments are less than they were in fiscal year 1994.
    Question. How does the Department intend to makeup for the 
shortfall in services, such as search and rescue, law enforcement, and 
road maintenance, currently provided by local governments in those 
areas dominated by Federal lands?
    Answer. The BLM 1998 budget proposal for PILT is the same as the 
Administration's proposal for 1997. In 1997, Congress appropriated an 
additional $12 million above the President's Budget
    Distribution of PILT payments is determined by several codified 
formulas and is designed to supplement other Federal land revenue 
sharing payments that county governments receive. Historic funding 
levels for PILT between 1977 and 1995 have been level, fluctuating only 
between $100 and $105 million. A 1994 amendment changed the methodology 
for calculating PILT payments but did not provide a new funding source.
    Funding for all PILT payments is provided via BLM appropriations. 
The BLM makes PILT payments for lands managed by BLM, NPS, the U.S. 
Forest Service, Corps of Engineers, and U.S. Army. Current payment 
formulas (as a result of the 1994 amendment) authorize an appropriation 
of up to $194 million for the 1998 payments. Congress has never 
appropriated this full amount.
                  water resources research institutes
    Dr. Eaton, one of the participants in the preliminary work to study 
the water resources of New Mexico's largest city--Albuquerque--was at 
the New Mexico Water Resources Research Institute headquartered at New 
Mexico State University. I have been familiar with the work of the 
Institute for years, and its scientists have made significant 
contributions to the State and to the Nation. The Administration 
proposes to phase out the State Water Resources Research Institutes, 
and essentially redirect its funding to the Federal program. In other 
words, the support the U.S. Geological Survey (USGS) has been providing 
through a long-standing partnership with the State Research Institutes 
is proposed to be terminated, and the work shifted in-house to USGS.
    Question. How does this proposed shift of research in-house fit in 
with the Administration's initiatives to foster partnerships in 
research?
    Answer. In a constrained budget climate, the Administration regrets 
the need to reduce funds to this program in favor of activities that 
more directly support the USGS mission. Nonetheless, the State Water 
Institutes, which receive grants under the Water Resources Research Act 
Program, will continue to receive Federal grant funds in fiscal year 
1998 at a reduced level. Also, the USGS student internship program 
begun in fiscal year 1996 in concert with the Water Institutes will 
continue providing many opportunities for fostering partnerships in 
research and education.
    New Mexico's Water Resources Research Institute will receive 
approximately $80,000 in fiscal year 1995, but these funds will 
leverage contributions from the State Legislature by as much as five 
times this amount because of the critical work being performed.
    Question. What is a realistic estimate of the lost resources to 
this important research that is likely to occur if the Administration's 
proposal is enacted?
    Answer. Although the Water Resources Research Act Program has been 
highly successful in past years, the fiscal year 1998 Budget includes 
$1.75 million for Water Resources Research Institutes, a reduction of 
$2.8 million. At this level of funding, equal grants will be awarded to 
each of the 54 institutes, thereby reducing the administrative cost. 
Predicting the impact of the proposed funding reduction on matching 
funds for individual Institutes is difficult, but the average Federal 
grant to each Institute in fiscal year 1998 under the President's 
proposed budget would be about $30,000. Currently, average leveraging 
of non-Federal to Federal dollars for the 54 Institutes exceeds 10 to 
1, far in excess of their Federal direct appropriation and associated 2 
to 1 matching funds. However, about one-third of the Institutes receive 
all or most of their funding from this Federal appropriation and 
associated matching funds, so that this action may result in the 
closure of some Institutes.
    One of the benefits of the current partnership with the State 
Institutes is that these programs train new researchers in earth 
sciences.
    Question. Does USGS have the capability to make up for this aspect 
of the proposed elimination of State Institutes?
    Answer. The proposed decrease in Institutes Program funding would 
not directly affect funds available for the USGS Water Resources 
Research Institute Internship program, which was established in fiscal 
year 1996 in concert with the Water Institutes. This program is a means 
of providing undergraduate and graduate students with career-enhancing 
field, laboratory, and research experience through participation in 
USGS activities as interns. Funds to support the interns are derived 
from other USGS projects or programs that desire to support student 
interns as part of the mix of efforts required to carry out program or 
project activities. These funds are consolidated and awarded under 
grants to Institutes participating in the internship program. The 
Institutes use these grant funds to employ students competitively 
selected from among applicants at colleges and universities across the 
country. The students are assigned USGS mentors on projects and 
programs providing the funds to support the Internships. In fiscal year 
1996 the USGS committed a total of $345,000 to the Internship program 
in six States. The combination of classroom work, coupled with on-the-
job training is excellent preparation for future water managers, water 
scientists, and technicians alike. It also assists USGS by providing a 
source of student help. Because of the success of this partnership, we 
expect it to grow significantly in the future.
    Question. How would you assess the research productivity of the 
State Institutes with that of USGS overall? Has such an assessment been 
undertaken as the Administration has considered this budget proposal?
    Answer. The State Water Institutes Program, with its non-Federal 
matching requirement, is an efficient means of stimulating and 
supporting water resources research, education, and information and 
technology transfer directed towards State and local water management 
problems. However, the Institutes Program cannot substitute for 
internal USGS functions that require a broad scale, long-term, 
nationally consistent approach. Functions such as collection and 
dissemination of streamflow data and the rapid response of USGS to 
flood emergencies could not be carried out by the Institutes. 
Similarly, a national assessment of water quality could not be 
conducted by the Institutes. The Administration recognizes that, 
although the Institutes Program provides excellent research and 
products, it does not contribute as directly to USGS mission 
activities.
    The New Mexico Water Resources Research Institute has been a major 
contributor to resource issues in the State and nationally. Some of the 
most recent examples of the Institute's work in New Mexico include:
  --Heading the Water Resources Task Force of the Governor's Technical 
        Excellence Committee, which developed the concept and needs 
        statement for the ``Critical Basin Assessments'' in New Mexico. 
        This program recommended that the Albuquerque/Middle Rio Grande 
        Basin be the first to be studied;
  --Organizing the Water Conference in Albuquerque last fall in which 
        you participated;
  --Contributing to a regional planning process to focus on developing 
        a more reliable municipal water supply for southern New Mexico 
        and El Paso; and
  --Working with WERC, Los Alamos, and Sandia to develop a proposal for 
        a major water resources initiative for New Mexico.
                                 ______
                                 
              Questions Submitted by Senator Conrad Burns
                      national park service (nps)
    Question. Mr. Secretary, could you provide the Committee with 
additional information on what the current backlog of construction and/
or repair projects is in our Nation's national parks? I would like to 
see this broken down by both region and per park level.
    Answer. The information follows:

                                                      RECAPITALIZATION OF THE NATIONAL PARK SYSTEM                                                      
                                    [Preliminary list of unfunded capital construction needs, alphabetically by park]                                   
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                           Gross                                                        
                     Park                                  Project title               construction     Package        Reg.      Objective    Work type 
                                                                                         estimate        number                                         
--------------------------------------------------------------------------------------------------------------------------------------------------------
Acadia National Park.........................  Upgrade restrooms, water, sewer,            5,750,000          232          NAR            1            U
                                                power.                                                                                                  
Acadia NP....................................  Rehabilitate historic structures.....       8,500,000          320          NAR            2            B
Acadia NP....................................  Rehabilitate tour loop roads and           24,000,000          287          NAR            2            R
                                                bridges.                                                                                                
Acadia NP....................................  Replace visitor center and construct       16,560,000          233          NAR            4            B
                                                park entrance.                                                                                          
Acadia NP....................................  Improve McFarland Hill Headquarters..       9,960,000          234          NAR            3            B
Acadia NP....................................  Alternative transportation modes.....       1,320,000         2006          NAR            5            R
Adams National Historic Site.................  Rehabilitate Beale Estate............       2,020,000          108          NAR            2            B
Agate Fossil Beds National Monument..........  Construct employee housing and              1,950,000          198          MWR            5            H
                                                recreation facilities.                                                                                  
Alaska parks (multiple)......................  Rehabilitate historic/building New          3,960,000          135          AKR            2            B
                                                Backcountry cabins.                                                                                     
AlibateS Flint Quarry NM.....................  Construct visitor contact station....       4,320,000          105          SWR            4            B
Allegheny Portage National Historic Site.....  Staple Bend Tunnel stabilization/           3,000,000          225          MAR            3            R
                                                development.                                                                                            
Allegheny Portage National Historic Site.....  ALPO/JOFL Development Program........      11,760,000          226          MAR            5            L
Amistad National Recreation Area.............  Construct visitor contact stations          3,000,000          117          SWR            5            B
                                                and boat launch.                                                                                        
Amistad NRA..................................  Reconstruct roads....................       2,640,000          180          SWR            3            R
Antietam National Battlefield................  Stabilize/restore historic battle           2,400,000          315          NCR            2            B
                                                structures.                                                                                             
Antietam NB..................................  Construct new roads for scene               2,886,000          271          NCR            2            R
                                                restoration.                                                                                            
Apostle Islands National Lakeshore...........  Protect lightstation from shoreline         4,642,400          839          MWR            2            L
                                                erosion.                                                                                                
Apostle Islands NL...........................  Renovate employee quarters in               1,440,000          248          MWR            3            H
                                                historic lightstations.                                                                                 
Arkansas Post NM.............................  Construct maintenance/storage               1,200,000          116          SWR            5            B
                                                facility.                                                                                               
Assateague Island National Seashore..........  Rehabilitate historic structures/           9,000,000          263          MAR            2            L
                                                stabilize national resources.                                                                           
Assateague NS................................  Reconstruct roads and parking, MD and       6,600,000          231          MAR            3            R
                                                VA.                                                                                                     
Assateague NS................................  Redevelop parking--chnctg............       3,432,000          233          MAR            3            R
Aztec Ruins NM...............................  Construct administrative ctr./              4,680,000          133          SWR            5            B
                                                operations complex.                                                                                     
Badlands NP..................................  Rehabilitate 30 miles of main road...      24,156,000          120          RMR            3            R
Baltimore-Washington Memorial Parkway........  System completion project............      31,680,000         1006          NCR            5            R
Bandelier NM.................................  Relocate facilities from Frijoles          15,700,000          214          SWR            2            B
                                                Canyon.                                                                                                 
Bandelier NM.................................  Rehabilitate Ponderosa Campground....       1,320,000          109          SWR            3            L
Bandelier NM.................................  Rehabilitate trails..................       3,600,000          210          SWR            2            L
Bandelier NM.................................  Construct water storage and                   840,000          246          SWR            3            U
                                                distribution.                                                                                           
Bering Land Bridge National Preserve.........  Construct multiagency visitor center.       5,564,000        100NO          AKR            4            B
Big Bend NP..................................  Rehabilitate Chisos Basin Campground.       3,200,000          274          SWR            3            L
Big Bend NP..................................  Reconstruct major park roads.........      19,008,000          223          SWR            3            R
Big Bend NP..................................  Construct addition to park visitor         10,680,000          114          SWR            5            B
                                                center.                                                                                                 
Big Bend NP..................................  Modernize/expand Panther Junction           3,200,000          132          SWR            1            U
                                                water system.                                                                                           
Big Bend NP..................................  Relocate overhead utility lines......       4,200,000          169          SWR            3            U
Big Bend NP..................................  Improve/expand Panther Junction             2,400,000          160          SWR            3            B
                                                maintenance area.                                                                                       
Big Bend NP..................................  Rehabilitate/expand campgrounds (RGV-       2,400,000          166          SWR            3            L
                                                CA).                                                                                                    
Big Bend NP..................................  Construct resource management               2,400,000          276          SWR            5            B
                                                facility.                                                                                               
Big Bend NP..................................  Rehabilitate and expand sewage              3,200,000          278          SWR            1            U
                                                treatment.                                                                                              
Big Cypress Nat Preserve.....................  Scenic corridor visitor safety hwy.         4,800,000            1          SER            1            R
                                                improvements.                                                                                           
Big Cypress NPRes............................  ADditional lands operation facility..       1,720,000            2          SER            4            B
Big Thicket NPRes............................  Construct park visitor center/              8,280,000          107          SWR            4            B
                                                headquarters.                                                                                           
Big Thicket NPRes............................  Construct trails, trailheads, water        13,200,000          111          SWR            2            L
                                                access.                                                                                                 
Big Thicket NPRes............................  Stabilize roads......................       2,112,000          113          SWR            3            R
Bighorn Canyon NRA...........................  Provide safe recreation area at OK-A-         254,400          222          RMR            3            L
                                                BEH.                                                                                                    
Blackstone River Valley NHCC.................  Rehabilitate Slater's Mill Historic         5,400,000          105          NAR            2            B
                                                Structures and Site.                                                                                    
Blue Ridge Parkway...........................  Fisher Peak Mountain Music Center....       4,000,000          507          SER            5            B
Blue Ridge Parkway...........................  Tunnels-lined........................       6,204,000          132          SER            3            R
Blue Ridge Parkway...........................  Grade separations....................       3,564,000          521          SER            3            R
Blue Ridge Parkway...........................  Resurface 25 miles of parkway........      87,912,000          503          SER            3            R
Booker T. Washington NM......................  Construct maintenance. shop and             1,822,800          161          MAR            5            B
                                                expand visitor center.                                                                                  
Boston Afro-American NHS.....................  Complete rehabilitation of Smith            1,175,000          102          NAR            2            B
                                                School.                                                                                                 
Boston Nat Historic Park.....................  Charlestown Navy Yard road safety           3,630,000          154          NAR            1            R
                                                improvements.                                                                                           
Boston NHP...................................  Rehabilitate Bunker Hill structure            859,200          106          NAR            2            L
                                                and site.                                                                                               
Boston NHP...................................  Preserve/rehabilitate historic              4,800,000          130          NAR            2            B
                                                commandant's house.                                                                                     
Bryce Canyon NP..............................  Reconstruct roads parkwide...........      25,080,000          106          RMR            3            R
Bryce Canyon NP..............................  Rehabilitate 206 camping sites in           1,700,000          103          RMR            3            L
                                                park.                                                                                                   
Bryce Canyon NP..............................  Rehabilitate visitor and education          4,400,000          125          RMR            3            B
                                                center.                                                                                                 
Buffalo National River.......................  Construct Tyler Bend employee housing       2,760,000          109          SWR            4            H
Buffalo NR...................................  Improve river camp sites, launches,        12,360,000          185          SWR            4            L
                                                and roads.                                                                                              
Buffalo NR...................................  Construct park headquarters and             5,520,000          240          SWR            4            B
                                                visitor center.                                                                                         
Buffalo NR...................................  Develop Pruitt public use/operations        1,800,000          113          SWR            4            B
                                                facilities.                                                                                             
C&O Canal NHP................................  Restore historic Monocacy aqueduct...       8,000,000          100          NCR            2            L
C&O Canal NHP................................  Reconstruct historic wide-water               630,000           01          NCR            1            L
                                                towpath.                                                                                                
C&O Canal NHP................................  Rehabilitate deteriorating historic           660,000          101          NCR            2            B
                                                complex.                                                                                                
C&O Canal NHP................................  Restore deteriorated historic               1,800,000           29          NCR            2            B
                                                tidelock.                                                                                               
C&O CANAL NHP................................  GREAT FALLS ENTRANCE STATION ROAD....         660,000           77          NCR            3            R
CANAVERAL NS.................................  CONSTRUCT HQ, VC, STORAGE, and              4,207,200          105          SER            5            B
                                                EXHIBIT COMPLEX.                                                                                        
CANYON DE CHELLY NM..........................  REHABILITATE CANYON ROADS............       1,200,000          172          SWR            3            R
CANYON DE CHELLY NM..........................  REHABILITATE PARK ROADS..............       1,980,000          169          SWR            3            R
CANYONLANDS NP...............................  REPAIR 225.4 MILES ROAD..............      16,368,000          183          RMR            3            R
CAPE COD NS..................................  REHABILITATE EIGHT BEACH FACILITIES..       9,100,000          226          NAR            1            B
CAPE COD NS..................................  REHABILITATE DORMITORY AND SEASONAL        11,850,000          225          NAR            1            H
                                                HOUSING UNITS.                                                                                          
CAPE COD NS..................................  REHABILITATE SALT POND AND                  4,896,000          228          NAR            2            B
                                                PROVINCELAND VISITOR CENTER.                                                                            
CAPE COD NS..................................  REHABILITATE PARK ROADS AND PARKING..       2,640,000          210          NAR            3            R
CAPE HATTERAS NS.............................  REPAIR/REPLACE EMPLOYEE HOUSING......       8,400,000          801          SER            3            H
CAPE HATTERAS NS.............................  CONSTRUCT PROTECTIVE GROIN...........       2,000,000          301          SER            2            L
CAPE HATTERAS NS.............................  RELOCATE LIGHTHOUSE..................      10,530,000          175          SER            2            L
CAPULIN VOLCANO NM...........................  EXPAND/IMPROVE MAINTENANCE AREA......       1,800,000          154          SWR            5            B
CARLSBAD CAVERNS NP..........................  REHABILITATE/REPLACE ELEVATOR SHAFT         2,000,000          198          SWR            1            B
                                                STEEL.                                                                                                  
CARLSBAD CAVERNS NP..........................  PROVIDE CAVE HANDRAIL................       1,200,000          199          SWR            1            L
CARLSBAD CAVERNS NP..........................  REPLACE WATER TRANSMISSION and              3,600,000          191          SWR            3            U
                                                STORAGE.                                                                                                
CARLSBAD CAVERNS NP..........................  RESURFACE ENTRANCE ROAD AND PARKING..         660,000          180          SWR            3            R
CASTLE CLINTON NM............................  REHABILITATE CASTLE CLINTON NATIONAL       26,040,000          105          NAR            5            B
                                                HISTORIC SITE.                                                                                          
CATOCTIN MOUNTAINS PARK......................  REPLACE FAILING ELECTRICAL SYSTEM....         721,810          989          NCR            3            U
CEDAR BREAKS NM..............................  RECONSTRUCT PARK ROADS...............       3,036,000          114          RMR            3            R
CHACO CULTURE NHP............................  CONSTRUCT HOUSING, CAMPGROUND, WATER/      11,040,000          204          SWR            5            B
                                                SEWER SYS.                                                                                              
CHACO CULTURE NHP............................  CONSTRUCT ADDITION TO MAINTENANCE             840,000          207          SWR            5            B
                                                SHOP.                                                                                                   
CHANNEL ISLANDS NP...........................  CONSTRUCT 8 EMPLOYEE HOUSES AT SANTA        3,458,400          671          WER            4            H
                                                ROSA.                                                                                                   
CHATTAHOOCHEE NRA............................  CONSTRUCT DAY USE FACILITIES, TRAILS,       3,885,600          101          SER            5            B
                                                COMFORT STATION.                                                                                        
CHICKAMAUGA and CHATTANOOGA..................  RELOCATE US HWY 27 WITHIN PARK (GA)..      30,360,000          142          SER            3            R
CHICKAMAUGA and CHATTANOOGA..................  IMPROVE PARK ROADS, SHOULDERS, and          6,732,000          102          SER            3            R
                                                DRIVEOUTS.                                                                                              
CHICKAMUAGA and CHATTANOOGA..................  REPLACE TWO BRIDGES-ALEXANDER BRIDGE        2,196,000          165          SER            1            R
                                                ROAD.                                                                                                   
CHICKASAW NRA................................  IMPROVE CAMPGROUNDS..................      11,540,000          215          SWR            3            L
CHICKASAW NRA................................  CONSTRUCT VISITOR CTR./HEADQTRS./           4,560,000          208          SWR            5            B
                                                MTNCE. COMPLEX.                                                                                         
CHICKASAW NRA................................  DEVELOP VETERANS LAKE VISITOR               2,400,000          209          SWR            5            R
                                                FACILITIES.                                                                                             
CHICKASAW NRA................................  REHABILITATE VETERANS DAM (REPAY BUR.         600,000          206          SWR            3            L
                                                OF RECLAMATION).                                                                                        
CHIRICAHUA NM................................  UPGRADE UTILITIES, HEADQUARTERS, and        1,200,000          241          SWR            3            B
                                                CAMPGROUND.                                                                                             
CHIRICAHUA NM................................  REHABILITATE MAIN PARK ROAD..........       9,372,000          103          WER            3            R
CITY OF ROCKS NM.............................  CONSTRUCT RV CAMPGROUND, ROADS,            23,160,000          101          PNR            2            B
                                                TRAILS, RESTROOMS.                                                                                      
COLONIAL NHP.................................  CONNECT JAMESTOWN WATER SYSTEM TO             959,000          400          MAR            1            U
                                                MUNICIPAL SYSTEM.                                                                                       
COLONIAL NHP.................................  PROTECT JAMESTOWN ISLAND FROM EROSION      18,000,000          248          MAR            2            L
COLONIAL NHP.................................  CONSTRUCT JAMESTOWN VIS. CTR. and          14,040,000          154          MAR            5            L
                                                COLLECTION STORAGE.                                                                                     
COLONIAL NHP.................................  BUILD COLONIAL PARKWAY BICYCLE and         24,000,000          249          MAR            5            L
                                                WALKING TRAIL.                                                                                          
COLONIAL NHP.................................  REALIGN PARK PORTION OF HIGHWAY 238..       3,699,600          127          MAR            5            R
COLONIAL NHP.................................  YORKTOWN ROADS AND BRIDGES...........       4,752,000          317          MAR            3            R
COLONIAL NHP.................................  REHABILITATE JAMESTOWN ROADS.........       1,320,000          321          MAR            3            R
COLONIAL NHP.................................  REPAIR/REHABILITATE COLONIAL PARKWAY.      13,200,000          251          MAR            3            R
COLORADO NM..................................  REHABILITATE 23 MILES OF RIMROCK            7,920,000          110          RMR            3            R
                                                DRIVE.                                                                                                  
CONGAREE SWAMP NM............................  CONSTRUCT PERMANENT FACILITIES.......       9,000,000          101          SER            4            B
COULEE DAM NRA...............................  EXPAND KELLER FERRY CAMPGROUND              2,400,000          203          PNR            5            B
                                                FACILITIES.                                                                                             
COULEE DAM NRA...............................  RESURFACE ROADS AND PARKING--PARKWIDE       2,040,000          266          PNR            1            R
COULEE DAM NRA...............................  RESURFACE ROADS AND PARKING..........       1,716,000          266          PNR            1            R
CRATER LAKE NP...............................  CONTRUCT ACTIVITY CENTER, PARKING,         60,000,000          274          PNR            2            B
                                                AND ROADS.                                                                                              
CRATER LAKE NP...............................  CONSTRUCT EMPLOYEE HOUSING AND              5,800,000          275          PNR            5            H
                                                SUPPORT FACILITIES.                                                                                     
CRATER LAKE NP...............................  CORRECT CLEETWOOD COVE PARKING              1,000,000          276          PNR            1            R
                                                FACILITIES.                                                                                             
CRATER LAKE NP...............................  RESURFACE ANNIE SPRINGS TO WEST             5,544,000          235          PNR            1            R
                                                BOUNDARY ROAD.                                                                                          
CRATER LAKE NP...............................  RESURFACE 6.1 MILES OF ROUTE 7--            1,452,000          253          PNR            1            R
                                                PINNACLES ROAD.                                                                                         
CRATER LAKE NP...............................  RESURFACE CLOUDCAP TO HEADQUARTERS          3,960,000          256          PNR            1            R
                                                ROAD.                                                                                                   
CRATERS OF THE MOON NM.......................  CONSTRUCT VISITOR CENTER, ROADS, AND        5,400,000          153          PNR            5            B
                                                UTILITIES.                                                                                              
CUMBERLAND GAP NHP...........................  SYSTEM COMPLETION PROJECT............      47,520,000         1007          SER            5            R
CUMBERLAND ISLAND NS.........................  CONSTRUCT VISITOR CENTER, EXHIBITS,         3,494,400          112          SER            5            B
                                                UTILITIES, MTNCE. FACILITIES.                                                                           
CURECANTI NRA................................  REPLACE WATER TREATMENT PLANT AND ADD       1,729,200          272          RMR            3            U
                                                RESERVOIR.                                                                                              
CUYAHOGA NRA.................................  RECONSTRUCT RIVER VIEW RD............       1,320,000          203          MWR            3            R
CUYAHOGA NRA.................................  RECONSTRUCT WHEATLEY ROAD............       1,848,000          206          MWR            3            R
CUYAHOGA VALLEY NRA..........................  CONTINUE CLEANUP OF KREJCI DUMP SITE.       5,400,000          260          MWR            1            L
DAYTON AVIATION HERITAGE NHS.................  REHABILITATE HISTORIC HOOVER BLOCK...       4,941,600          100          MWR            2            B
DEATH VALLEY NP..............................  CONSTRUCT EMPLOYEE HOUSING AT DEATH        19,807,200          388          WER            1            H
                                                VALLEY.                                                                                                 
DEATH VALLEY NP..............................  REPLACE COW CREEK MAINTENANCE               5,187,600          500          WER            1            B
                                                FACILITY.                                                                                               
DEATH VALLEY NP..............................  REHABILITATE BADWATER ROAD and SPUR        14,916,000          283          WER            3            R
                                                ROADS.                                                                                                  
DEATH VALLEY NP..............................  RECONSTRUCT ROUTES 8 and 35..........      19,932,000          105          WER            3            R
DEATH VALLEY NP..............................  SURFACE 7 MILES OF N ENTRANCE ROAD--        1,848,000          257          WER            5            R
                                                ROUTE 8.                                                                                                
DEATH VALLEY NP..............................  REHABILITATE MUD CANYON and DAYLIGHT       12,144,000          348          WER            3            R
                                                PASS ROADS.                                                                                             
DEATH VALLEY NP..............................  RECONSTRUCT/REALIGN GRAPEVINE CANYON       10,032,000          352          WER            3            R
                                                ROAD.                                                                                                   
DELAWARE WATER GAP NRA.......................  REPAIR/REPLACE NEW JERSEY VISITOR USE      24,120,000          264          MAR            3            B
                                                FACILITIES.                                                                                             
DELAWARE WATER GAP NRA.......................  STABILIZE HISTORIC STRUCTURES AT 40        22,320,000          111          MAR            2            B
                                                SITES.                                                                                                  
DELAWARE WATER GAP NRA.......................  REPAIR/REPLACE PENNSYLVANIA VISITOR        22,476,000          263          MAR            3            L
                                                USE FACILITIES.                                                                                         
DELAWARE WATER GAP NRA.......................  REHABILITATE WEYGADT FACILITIES and        19,200,000          319          MAR            4            B
                                                BUILD VISITOR CTR.                                                                                      
DELAWARE WATER GAP NRA.......................  REHABILITATE/REPAIR ROUTE 209 (22MI)       52,800,000          292          MAR            3            R
                                                and 6 BRIDGES.                                                                                          
DENALI NP....................................  CONSTRUCT FIRE-EMERGENCY SERVICES and       1,620,000          105          AKR            5            B
                                                HEADQTRS. BLDG.                                                                                         
DENALI NP....................................  REHABILITATE ENTRANCE AREA UTILITIES--      3,410,000          120          AKR            3            U
                                                WATER and SEWER.                                                                                        
DENALI NP....................................  RESTORE 77.6 MILES OF GRAVEL ROAD          13,200,000          258          AKR            1            R
                                                SURFACE.                                                                                                
DENALI NP....................................  CONSTRUCT TOKLAT REST STOP FACILITIES       1,120,000        100TO          AKR            4            B
DENALI NP....................................  REPAIR 77.6 MI GRAVEL RD.............      13,200,000          258          AKR            3            R
DENALI NP....................................  ALTERNATIVE TRANSPORTATION MODES.....       1,320,000         2007          AKR            5            R
DINOSAUR NM..................................  RECONSTRUCT/REHABILITATE 3 FAILING         12,000,000          216          RMR            3            B
                                                STRUCTURES.                                                                                             
DINOSAUR NM..................................  CONSTRUCT MUSEUM COLLECTION/RESEARCH        4,700,000          204          RMR            5            B
                                                BUILDING.                                                                                               
DINOSAUR NM..................................  RECONSTRUCT ROADS PARKWIDE...........       9,636,000          191          RMR            3            R
DRY TORTUGAS NM..............................  REHABILITATE PORTIONS OF FORT              14,400,000          103          SER            2            L
                                                JEFFERSON.                                                                                              
EDISON NHS...................................  DEVELOP EDISON CENTER and                  29,600,000          170          NAR            1            B
                                                REHABILITATE LAB. COMPLEX.                                                                              
EISENHOWER NHS...............................  STABILIZE/REPAIR FARM STRUCTURES.....       8,620,000          130          MAR            2            B
EL MALPAIS NM................................  DEVELOP MULTIAGENCY VISITOR CENTER          5,520,000          105          SWR            4            B
                                                (PHASE 2.                                                                                               
EVERGLADES NP................................  REPLACE 20 PLUS OBSOLETE WATER and         14,600,000          191          SER            1            U
                                                SEWER SYSTEMS.                                                                                          
EVERGLADES NP................................  MODIFY WATER DELIVERY SYSTEM.........      80,000,000          193          SER            2            L
EVERGLADES NP................................  REPAVE MAIN PARK ROAD................       7,128,000          111          SER            3            R
FEDERAL HALL NAT MEMORIAL....................  REHABILITATE FEDERAL HALL............      10,104,000          105          NAR            1            B
FIRE ISLAND NS...............................  CONSTRUCT SUSTAINABLE STUDENT               2,800,000            1          NAR            3            B
                                                DISCOVERY CAMP.                                                                                         
FIRE ISLAND NS...............................  CONSTRUCT VISITOR CENTER, MTNCE., and       6,000,000          169          NAR            4            B
                                                ADMIN. FACILITY.                                                                                        
FIRE ISLAND NS...............................  PRESERVE/REHABILITATE HISTORIC FLOYD        3,600,000          174          NAR            5            B
                                                ESTATE.                                                                                                 
FLORISSANT FOSSIL BEDS NM....................  CONSTRUCT INITIAL PARK FACILITIES....       9,500,000          103          RMR            4            B
FORT DONELSON NB.............................  CONSTRUCT BYPASS ROAD................       1,980,000          127          SER            5            R
FORT LARNED NHS..............................  CONSTRUCT VISITOR CENTER.............       7,291,200          198          MWR            5            B
FORT MCHENRY NM and HIST SHRINE..............  COMPLETE HISTORIC SEAWALL REPAIRS....       2,210,000            1          MAR            2            L
FORT MCHENRY NM and HIST SHRINE..............  REPLACE UNSAFE VISITOR CENTER........       8,520,000          277          MAR            5            B
FORT NECESSITY NB............................  REHAB/DEVELOPMENT OF FORT NECESSITY..      12,024,000          230          MAR            4            L
FORT POINT NHS...............................  REPAIR EARTHQUAKE DAMAGE and REPOINT        2,140,000          393          WER            2            B
                                                BRICKWORK.                                                                                              
FORT SCOTT NHS...............................  PROVIDE FIRE PROT. SYSTEMS FOR              1,244,400          227          MWR            2            B
                                                HISTORIC STRUCTURES.                                                                                    
FORT SUMTER NM...............................  CONSTRUCT TOUR BOAT FACILITY --             7,100,000          105          SER            5            B
                                                DOCKSIDE II.                                                                                            
FORT UNION NM................................  CONSTRUCT CURATORIAL, AUDIO-VISUAL,           720,000          102          SWR            5            B
                                                and OFFICE AREAS.                                                                                       
FREDERICKSBURG N MILITARY PARK...............  PROTECT PARK BOUNDARY................         800,000          106          MAR            2            L
FREDERICKSBURG NMP...........................  STABILIZE HISTORIC STRUCTURES, RUINS,       3,855,600          107          MAR            2            L
                                                and EARTHWORKS.                                                                                         
FREDERICKSBURG NMP...........................  ENLARGE VISITOR CENTER/RESTORE HIST.       14,400,000          271          MAR            3            L
                                                ROAD TRACES.                                                                                            
FREDERICKSBURG NMP...........................  REHABILITATE PARK ROADS..............       7,128,000          230          MAR            3            R
GATEWAY NRA..................................  REHABILITATE FLOYD BENNETT FIELD, FT.      12,300,000          169          NAR            1            U
                                                TILDEN UTILITIES.                                                                                       
GATEWAY NRA..................................  COMPLETE REHABILITATION OF JACOB RIIS      12,100,000          147          NAR            1            B
                                                PARK.                                                                                                   
GATEWAY NRA..................................  COMPLETE GREAT KILLS PARK                   2,800,000          149          NAR            4            B
                                                REHABILITATION.                                                                                         
GATEWAY NRA..................................  REHABILITATE BATTERY WEED SEAWALL and       3,280,000          219          NAR            2            L
                                                DOCK.                                                                                                   
GATEWAY NRA..................................  PRESERVE/REHABILITATE FORT HANCOCK        120,000,000          123          NAR            2            B
                                                STRUCT. and UTIL.                                                                                       
GATEWAY NRA..................................  REHABILITATE FORT WADSWORTH FOR            48,000,000          191          NAR            1            B
                                                VISITOR and NPS USE.                                                                                    
GATEWAY NRA..................................  REHABILITATE SANDY HOOK MAIN ROAD....       8,580,000          111          NAR            1            R
GATEWAY NRA..................................  REHABILITATE MILLER FIELD ROAD AND          4,224,000          115          NAR            3            R
                                                PARKING.                                                                                                
GATEWAY NRA..................................  REHABILITATE PARK ROADS..............      21,780,000          185          NAR            1            R
GEO. WASHINGTON MEML PKWY....................  REHABILITATE GLEN ECHO FACILITIES....       2,000,000          171          NCR            3            B
GEO. WASHINGTON MEML PKWY....................  RESTORE THEODORE ROOSEVELT MEMORIAL..       1,765,000          181          NCR            2            L
GEO. WASHINGTON MEML PKWY....................  CandO VIEWSHED-REMOVE/REHABILITATE         19,752,000          172          NCR            2            L
                                                STRUCT. and LNDSCP.                                                                                     
GEO. WASHINGTON MEML PKWY....................  RECONSTRUCT SPOUT RUN PARKWAY (PHASE        7,440,000          836          NCR            1            R
                                                IV).                                                                                                    
GEO. WASHINGTON MEML PKWY....................  PRESERVE ARLINGTON HOUSE HISTORIC             420,000          103          NCR            2            B
                                                FURNISHINGS.                                                                                            
GEO. WASHINGTON MEML PKWY....................  SPROUT RUN TO 123....................       6,600,000          461          NCR            1            R
GEO. WASHINGTON MEML PKWY....................  123 TO SPROUT RUN....................       6,600,000          461          NCR            1            R
GEORGE WASHINGTON MEML PKWY..................  REHABILITATE MEMORIAL AVENUE BRIDGE..       3,300,000          464          NCR            3            R
GEORGE ROGERS CLARK NHP......................  REHABILITATE HISTORIC MEMORIAL              1,560,000          122          MWR            2            B
                                                TERRACE.                                                                                                
GETTYSBURG NMP...............................  PROTECT HISTORIC STRUCTURES..........       2,500,000            1          MAR            2            B
GETTYSBURG NMP...............................  REPAIR 22 HISTORIC MONUMENTS.........       2,012,000            2          MAR            2            L
GETTYSBURG NMP...............................  REHABILITATE VISITOR CENTER..........       4,280,000          296          MAR            1            B
GETTYSBURG NMP...............................  REHAB PARK ROADS.....................       8,316,000          106          MAR            3            R
GLACIER BAY NP...............................  CONSTRUCT MTNCE. FACILITIES/                1,700,000        100BC          AKR            1            U
                                                REHABILITATE UTILITY SYS.                                                                               
GLACIER BAY NP...............................  CONSTRUCT PARK EMPLOYEE HOUSING......       3,100,000          130          AKR            4            H
GLACIER BAY NP...............................  REHABILITATE MAIN PARK ROAD..........       6,204,000          170          AKR            3            R
GLACIER NP...................................  UPGRADE UNSAFE WATER AND SEWER SYSTEM       9,500,000          165          RMR            1            U
GLACIER NP...................................  REHAB GOING TO THE SUN ROAD, 55 MILES      78,144,000          303          RMR            3            R
GLACIER NP...................................  REHABILITATE SUBSTANDARD BACKCOUNTRY        2,800,000          357          RMR            3            B
                                                CHALETS.                                                                                                
GLACIER NP...................................  REHABILITATE LAKE MCDONALD/APGAR           18,673,200          264          RMR            3            B
                                                CONCESS. FACILITIES.                                                                                    
GLACIER NP...................................  REPLACE OBSOLETE HOUSING PARKWIDE....      18,765,600          399          RMR            3            H
GLEN CANYON NRA..............................  CONSTRUCT FEE COLLECTION STATIONS and      10,616,400          210          RMR            4            B
                                                EMPL. HOUSING.                                                                                          
GLEN CANYON NRA..............................  UPGRADE SUBSTANDARD PARK HOUSING.....      18,726,000          421          RMR            3            H
GLEN CANYON NRA..............................  CORRECT MARINA CONSTRUCTION                 1,176,000          434          RMR            3            U
                                                DEFICIENCIES.                                                                                           
GLEN CANYON NRA..............................  REHABILITATE STATE LINE ROADS........       3,168,000          341          RMR            3            R
GLEN CANYON NRA..............................  REHABILITATE BULL FROG ROADS.........       5,544,000          342          RMR            3            R
GLEN CANYON NRA..............................  RECONSTRUCT MARINA ACCESS ROAD.......       1,980,000          380          RMR            3            R
GOLDEN GATE NRA..............................  REHABILITATE/REPAIR FORT MASON PIER..      25,152,000          282          WER            2            B
GOLDEN GATE NRA..............................  REPLACE RESTROOMS....................       3,301,200          357          WER            5            B
GOLDEN GATE NRA..............................  STABILIZE ALCATRAZ HISTORIC                 5,030,400          167          WER            2            B
                                                STRUCTURES.                                                                                             
GOLDEN GATE NRA..............................  REHABILITATE MARIN DISTRICT ROADS....      10,032,000          857          WER            3            R
GOLDEN GATE NRA..............................  REHABILITATE SAN FRANCISCO DISTRICT         4,620,000          858          WER            3            R
                                                ROADS.                                                                                                  
GRAND CANYON NP..............................  CONSTRUCT REPLACEMENT HOUSING........      16,800,000          143          WER            1            H
GRAND CANYON NP..............................  REPLACE NORTH RIM PIPELINE and             11,800,000          319          WER            1            U
                                                TREATMENT SYSTEM.                                                                                       
GRAND CANYON NP..............................  LANDFILL CLOSURE.....................       6,300,000          190          WER            1            L
GRAND CANYON NP..............................  CONSTRUCT SOUTH RIM ORIENTATION......      21,900,000            1          WER            5            B
GRAND CANYON NP..............................  REHABILITATE SUBSTANDARD HOUSING.....       7,545,600          348          WER            1            H
GRAND CANYON NP..............................  SAFETY RECONSTRUCTION OF WEST RIM           7,388,400          196          WER            1            R
                                                DRIVE.                                                                                                  
GRAND CANYON NP..............................  CONSTRUCT PUBLIC RESTROOMS...........       3,301,200          121          WER            5            B
GRAND CANYON NP..............................  REALIGN/REPAIR EAST RIM ROAD.........      11,352,000          272          WER            3            R
GRAND CANYON NP..............................  RECONSTRUCT SOUTH RIM ROADS..........      50,160,000          110          WER            3            R
GRAND CANYON NP..............................  RECONSTRUCT WEST RIM DRIVE...........       7,128,000          196          WER            1            R
GRAND PORTAGE NM.............................  REMOVE HOUSING and MTNCE. ACTIVITIES        3,240,000          106          MWR            2            B
                                                FROM HIST. RES.                                                                                         
GRAND PORTAGE NM.............................  CONSTRUCT VISITOR CENTER/                   4,380,000          105          MWR            5            B
                                                ADMINISTRATIVE FACILITY.                                                                                
GRAND PORTAGE NM.............................  RELOCATE ROADS.......................       1,716,000          108          MWR            2            R
GRAND TETON NP...............................  COMPLETE FINAL SURFACE FOR 31.7 MILES      14,784,000          328          RMR            3            R
                                                OF MAIN ROAD.                                                                                           
GRAND TETON NP...............................  REPAIR UTILITY SYSTEMS PARKWIDE......      30,000,000          102          RMR            3            U
GRAND TETON NP...............................  REPLACE PARK HOUSING TO MEET               25,836,000          148          RMR            3            H
                                                STANDARDS.                                                                                              
GREAT BASIN NP...............................  REPAIR ROAD SURFACE and SHOULDERS....       5,940,000          197          WER            3            R
GREAT SAND DUNES NM..........................  EXPAND VISITOR CENTER THRU                  1,900,000          103          RMR            5            B
                                                PARTNERSHIP.                                                                                            
GREAT SAND DUNES NM..........................  WIDEN and REHABILITATE ROAD..........       2,640,000          126          RMR            3            R
GREAT SMOKY MOUNTAINS NP.....................  CONSTRUCT OCONOLUFTEE VISITOR CENTER.       8,000,000          129          SER            5            B
GREAT SMOKY MOUNTAINS NP.....................  REPLACE FOUR BRIDGES.................       3,696,000          319          SER            3            R
GREAT SMOKY MOUNTAINS NP.....................  COMPLETE 33.5 MILES OF FOOTHILLS           34,980,000          109          SER            4            R
                                                PKWY. and ASSOC. FAC.                                                                                   
GREAT SMOKY MOUNTAINS NP.....................  CONST INTERP CTR, PICNIC AREA, RDS         22,680,000          314          SER            5            B
                                                and UTI.                                                                                                
GREAT SMOKY MOUNTAINS NP.....................  REHAB ABRAMS, GREENBRIER, BIG CREEK         1,452,000          324          SER            3            R
                                                RDS.                                                                                                    
GUADALUPE MOUNTAINS NP.......................  CONSTRUCT TRAIL SYSTEM (PHASE 4......       1,200,000          110          SWR            2            L
GUADALUPE MOUNTAINS NP.......................  CONSTRUCT PINE SPRINGS CAMPGROUND....       1,560,000          202          SWR            4            L
GUADALUPE MOUNTAINS NP.......................  SURFACE DOG CANYON ENTRANCE ROAD.....       1,056,000          207          SWR            3            R
HAGERMAN FOSSIL BEDS NM......................  CONSTRUCT RESEARCH CENTER/MUSEUM.....      16,800,000          101          PNR            4            B
HALEAKALA NP.................................  REHAB HOUSE OF THE SUN VIS. CTR. and        3,144,000          105          WER            3            B
                                                COMFORT STATION.                                                                                        
HALEAKALA NP.................................  CONSTRUCT KIPAHULA WATER SYS.,              4,087,200          153          WER            4            B
                                                RESTROOM, ADMIN. FAC.                                                                                   
HAMILTON GRANGE NAT MEML.....................  REHABILITATE and RELOCATE HAMILTON         13,080,000          105          NAR            2            B
                                                GRANGE.                                                                                                 
HAMPTON NHS..................................  RESTORE DETERIORATED HISTORIC               9,600,000          209          MAR            2            B
                                                STRUCTURES.                                                                                             
HARPERS FERRY NHP............................  STABILIZE HISTORIC STRUCTURES........       2,673,600          118          NCR            2            B
HARRY S TRUMAN NHS...........................  REHAB TRUMAN AND NOLAND HISTORIC            1,200,000          200          MWR            2            B
                                                HOUSES.                                                                                                 
HAWAII VOLCANOES NP..........................  REHABILITATE CRATER RIM DRIVE........       6,996,000          211          WER            3            R
HERBERT HOOVER NHS...........................  CONSTRUCT FARM ROAD..................       1,848,000          162          MWR            3            R
HERBERT HOOVER NHS...........................  CONSTRUCT MAINTENANCE FACILITY.......         840,000          743          MWR            5            B
HERBERT HOOVER NHS...........................  STABILIZE and ADAPTIVELY RESTORE 8          2,880,000          110          MWR            2            B
                                                HISTORIC HOUSES.                                                                                        
HOME OF FDR NHS..............................  RESTORE/REHABILITATE FDR HOME AND           7,042,000          137          NAR            2            B
                                                SITE.                                                                                                   
HOME OF FDR NHS..............................  REHABILITATE ROADS, BRIDGES, and            6,204,000          138          NAR            3            R
                                                PARKWAY.                                                                                                
HOPEWELL FURNACE NHS.........................  COMPLETE PRESERVATION OF FURNACE            6,000,000          195          MAR            2            L
                                                RESOURCES.                                                                                              
HORACE ALBRIGHT TRAINING CTR.................  REHABILITATE TRAINING CENTER COMPLEX.       6,241,000            1         WASO            3            B
HOT SPRINGS NP...............................  REHABILITATE/RESTORE BATHHOUSE ROW         10,100,000          145          SWR            2            B
                                                STRUCTURES.                                                                                             
HOT SPRINGS NP...............................  UPGRADE GULPHA GORGE CAMPGROUND......       2,400,000          245          SWR            3            L
HOVENWEEP NM.................................  BUILD VISITOR CENTER/RANGER STATION         3,670,000          134          RMR            4            B
                                                and SUPPORT FAC.                                                                                        
HUBBELL TRADING POST NHS.....................  CONTROL EROSION IN PUEBLO COLORADO            840,000          158          SWR            2            L
                                                WASH.                                                                                                   
HUBBELL TRADING POST NHS.....................  IMPROVE VISITOR USE, MTNCE., and            3,000,000          107          SWR            4            B
                                                CURATORIAL FACILITIES.                                                                                  
INDEPENDENCE NHP.............................  IMPROVE/REHABILITATE UTILITIES.......      80,000,000          412          MAR            1            U
INDEPENDENCE NHP.............................  REHABILITATE INDEPENDENCE MALL WALKS       18,600,000          168          MAR            1            L
                                                AND WALLS.                                                                                              
INDIANA DUNES NL.............................  REMOVE ASBESTOS FROM 250 STRUCTURES..       6,960,000          510          MWR            1            B
INDIANA DUNES NL.............................  CONSTRUCT WEST UNIT ACCESS ROAD......       7,920,000          288          MWR            5            R
INDIANA DUNES NL.............................  IMPROVE PARK ROADS (INCLUDES PKG 295.      29,040,000          294          MWR            3            R
ISLE ROYALE NP...............................  REPLACE ELEVATED WATER TANK..........       3,520,000          188          MWR            1            U
ISLE ROYALE NP...............................  REHABILITATE RANGER III..............       2,300,000          319          MWR            1            L
ISLE ROYALE NP...............................  CONSTRUCT EMPLOYEE HOUSING DUPLEX....         786,000          400          MWR            1            H
ISLE ROYALE NP...............................  CONSTRUCT 3 EMPLOYEE HOUSING DUPLEXES       2,280,000          117          MWR            5            H
JAMES A. GARFIELD NHS........................  REHABILITATE FIRE and INTRUSION ALARM       7,308,000          103          MWR            2            B
                                                SYSTEMS.                                                                                                
JAMES A. GARFIELD NHS........................  RECONSTRUCT ROAD and PARKING.........         924,000          164          MWR            3            R
JEAN LAFITTE NHP and PRES....................  PROVIDE THIBODEAU LANDSCAPING and           1,920,000          178          SWR            4            L
                                                PARKING.                                                                                                
JEFFERSON NAT EXPANSION MEML.................  REPLACE ARCH HANDICAPPED ACCESS RAMPS       2,340,000          241          MWR            1            B
JEFFERSON NAT EXPANSION MEML.................  CONSTRUCT PARKING GARAGE and GROUNDS        1,560,000          220          MWR            5            B
                                                MTNCE. FAC.                                                                                             
JOHN D. ROCKEFELLER MEM PKWY.................  DEVELOPMENT OF FLAGG RANCH FACILITIES      16,300,000          131          RMR            5            B
JOHN DAY FOSSIL BEDS NM......................  CONSTRUCT VISITOR/RESEARCH CENTER....      14,400,000          105          PNR            5            B
JOSHUA TREE NM...............................  RECONSTRUCT ROADS, PARKING, and            27,720,000          173          WER            3            R
                                                CAMPGROUND ROADS.                                                                                       
JOSHUA TREE NM...............................  REHABILITATE OASIS VISITOR CENTER and       4,873,200          388          WER            3            B
                                                ADMIN. BLDG.                                                                                            
JOSHUA TREE NM...............................  RECONSTRUCT/REHABILITATE NARROW            17,160,000          174          WER            3            R
                                                UNSAFE ROADS.                                                                                           
KATMAI NP....................................  CONSTRUCT LAKE CAMP FACILITIES.......       1,726,000          102          AKR            4            L
KATMAI NP....................................  RELOCATE BROOKS CAMP FACILITIES/           10,600,000        100BC          AKR            2            B
                                                REPAIR VTS ROAD.                                                                                        
KENAI FJORDS NP..............................  CONSTRUCT VISITOR CENTER/HEADQUARTERS      11,500,000        100SW          AKR            3            U
                                                FACILITY.                                                                                               
KENAI FJORDS NP..............................  IMPROVE ACCESS AND VISITOR FACILITIES       2,800,000        100EG          AKR            3            B
KEWEENAW NHP.................................  STABILIZE CORE BUILDINGS.............       4,716,000          100          MWR            2            B
LAKE CLARK NP and PRES.......................  CONSTRUCT HOUSING and SUPPORT               6,939,000        100PA          AKR            4            B
                                                FACILITIES.                                                                                             
LAKE MEAD NRA................................  UPGRADE WATER TREATMENT AT KATHERINE.       3,095,000           69          WER            1            U
LAKE MEAD NRA................................  MITIGATE STRUCTURAL FLOODING PROBLEMS      29,600,000          853          WER            1            L
LAKE MEAD NRA................................  SAFETY RECONSTRUCTION LAKESHORE ROAD.      32,340,000          242          WER            1            R
LAKE MEAD NRA................................  REHAB NORTH SHORE ROAD and CONNECT         55,440,000          457          WER            1            R
                                                ACCESS.                                                                                                 
LAKE MEAD NRA................................  ENTRANCE STATION PROGRAM.............      15,248,400          594          WER            5            B
LAKE MEAD NRA................................  IMPROVE ROAD TO PRINCESS COVE........       2,508,000          700          WER            3            R
LAKE MEREDITH NRA............................  RECONSTRUCT/RECONNECT/REPAIR WATER          4,400,000          210          SWR            1            U
                                                SYSTEM.                                                                                                 
LAKE MEREDITH NRA............................  REHABILITATE/CONSTRUCT CAMPGROUNDS         33,480,000          110          SWR            3            L
                                                and RESTROOMS.                                                                                          
LAKE MEREDITH NRA............................  RECONSTRUCT ACCESS ROADS and PARKINGS       7,788,000          185          SWR            3            R
LAKE MEREDITH NRA............................  CONNECT PARK TO FRITCH WATER SYSTEM..         960,000          192          SWR            3            U
LASSEN VOLCANIC NM...........................  UPGRADE HEADQUARTERS UTILITY SYSTEMS.       4,244,400          325          WER            3            U
LASSEN VOLCANIC NM...........................  REPAIR MAIN PARK ROAD................      13,596,000          101          WER            3            R
LASSEN VOLCANIC NM...........................  PAVE BUTTE LAKE ACCESS and CAMPGROUND       1,716,000          312          WER            3            R
LAVA BEDS....................................  RECONSTRUCT SOUTHEAST ENTRANCE ROAD..       5,940,000          302          WER            3            R
LAVA BEDS NM.................................  RECONSTUCT S.E. ENTRANCE and MEDICINE       5,940,000          302          WER            3            R
                                                LAKE ROADS.                                                                                             
LINCOLN BOYHOOD NM...........................  RELOCATE COUNTY ROADS A and B/UPGRADE       2,772,000          126          MWR            3            R
                                                PARKING.                                                                                                
LINCOLN HOME NHS.............................  STABILIZE/RESTORE STUVE HOUSE........       3,144,000          403          MWR            2            B
LITTLE BIGHORN NB............................  CONSTRUCT INDIAN MEMORIAL............         900,000          147          RMR            5            L
LOWELL NHP...................................  COMPLETE BOOTT MILL..................         958,000          117          NAR            2            B
LOWELL NHP...................................  REHAB VISITOR CENTER PARKING.........         660,000          101          NAR            4            R
LYNDON B. JOHNSON NHP........................  CONSTRUCT MAINTENANCE/BUS SERVICE           3,600,000          135          SWR            5            B
                                                AREA.                                                                                                   
LYNDON B. JOHNSON NHP........................  REHABILITATE PARK ROADS..............       1,980,000          193          SWR            3            R
LYNDON B. JOHNSON NHP........................  EXTEND WATER SYSTEM TO JUNCTION               600,000          198          SWR            2            U
                                                SCHOOL.                                                                                                 
MAMMOTH CAVE NP..............................  RENOVATE VISITOR CENTER..............       5,327,000          171          SER            3            B
MAMMOTH CAVE NP..............................  CONSTRUCT NEW ADMINISTRATION BUILDING       9,720,000          185          SER            5            B
MANASSAS NAT BATTLEFIELD PARK................  RESTORE DISTURBED STUART'S HILL             6,828,000          225          NCR            2            L
                                                BATTLEGROUND.                                                                                           
MANASSAS NAT BATTLEFIELD PARK................  PRESERVE HISTORIC RESOURCES FOR             1,382,000          155          NCR            2            L
                                                VISITOR USE.                                                                                            
MESA VERDE NP................................  STABILIZE AND RESTORE PREHISTORIC          12,000,000          239          RMR            2            B
                                                STRUCTURES.                                                                                             
MESA VERDE NP................................  COMPLETE WATERLINE REPLACEMENT.......       4,500,000          223          RMR            3            U
MESA VERDE NP................................  CONSTRUCT ENTRANCE STATION and              1,542,000          120          RMR            5            B
                                                COMPLETE ROAD.                                                                                          
MESA VERDE NP................................  CORRECT ENTRANCE ROAD FAILURE........       9,636,000          278          RMR            3            R
MESA VERDE NP................................  RECONSTRUCT WETHERILL ROAD...........       7,920,000          225          RMR            3            R
MINUTE MAN NHP...............................  PRESERVE/REHABILITATE 29 HIST. BATTLE       7,200,000          171          NAR            1            B
                                                RD. STRUCTURES.                                                                                         
MISSISSIPPI NAT RIVERandRECR. AREA...........  DEVELOP PARTNERSHIP EDUC. FAC. IN           2,564,000          110          MWR            4            B
                                                SCIENCE MUSEUM.                                                                                         
MISSISSIPPI NR&RA............................  CONSTRUCT PARTNERSHIP EDUCATION             4,281,000          114          MWR            4            B
                                                CENTER.                                                                                                 
MONOCACY NB..................................  RESTORE STRUCTURE FOR PRESERVATION          5,940,000          337          NCR            2            B
                                                TRAINING.                                                                                               
MONTEZUMA CASTLE NM..........................  DEVELOP MONTEZUMA WELL INFRASTRUCTURE       2,940,000          100          SWR            4            B
                                                & FAC.                                                                                                  
MORRISTOWN NHP...............................  REHABILITATE PARK TOUR ROADS.........       7,128,000          187          NAR            3            R
MOUNT RAINIER NP.............................  REHABILITATE JACKSON VISITOR CENTER..       4,400,000          399          PNR            3            B
MOUNT RAINIER NP.............................  REPLACE SUNRISE LODGE................       5,400,000          315          PNR            1            B
MOUNT RAINIER NP.............................  REHABILITATE HIGHWAY 410.............       6,864,000         349A          PNR            1            R
MOUNT RAINIER NP.............................  CONSTRUCT TAHOMA WOODS ENTRANCE/            1,800,000          311          PNR            5            B
                                                CONTACT STATION.                                                                                        
MOUNT RAINIER NP.............................  REHABILITATE PARADISE INN and ANNEX..       8,400,000          370          PNR            3            B
MOUNT RAINIER NP.............................  REHABILITATE HIGHWAY 123.............      25,080,000         349B          PNR            1            R
MOUNT RAINIER NP.............................  REHABILITATE CARBON RIVER FACILITIES.       6,000,000          316          PNR            2            B
MOUNT RAINIER NP.............................  RECONSTRUCT BACKBONE RIDGE VIADUCT...       3,036,000          386          PNR            1            R
MOUNT RUSHMORE N MEML........................  REPLACE WASTEWATER TREATMENT SYSTEM..       8,989,000          182          RMR            3            U
MOUNT RUSHMORE N MEML........................  CONSTRUCT EXHIBITS and MTNCE. FAC./        12,000,000          182          RMR            5            B
                                                REHABILITATE STUDIO.                                                                                    
NATCHEZ TRACE PARKWAY........................  CONSTRUCT PARKWAY....................      55,440,000          300          SER            5            R
NATCHEZ TRACE PARKWAY........................  CONSTRUCT NORTH VISITOR CENTER and          6,000,000         300A          SER            5            B
                                                MAINTENANCE AREA.                                                                                       
NATCHEZ TRACE PARKWAY........................  CONSTRUCT FOUR OVERPASSES............       5,280,000          238          SER            5            R
NATCHEZ TRACE PARKWAY........................  REPAIR/REPLACE BRIDGES...............      17,556,000          264          SER            3            R
NATCHEZ TRACE PARKWAY........................  RESURFACE VARIOUS SECTIONS OF PARKWAY      99,000,000          250          SER            3            R
NATIONAL CAPITOL AREA........................  CONSTRUCT MUSEUM/ARCHEOLOGICAL             16,000,000         323A          NCR            5            B
                                                STORAGE FACILITY.                                                                                       
NATIONAL CAPITOL AREA........................  REHABILITATE and ADD SPACE TO              17,488,800          730          NCR            3            B
                                                HEADQUARTERS BUILDING.                                                                                  
NATIONAL CAPITOL PARKS-CENTRAL...............  RESTORE LINCOLN AND JEFFERSON              15,400,000          758          NCR            2            B
                                                MEMORIALS.                                                                                              
NATIONAL CAPITOL PARKS-CENTRAL...............  STABILIZE AND PRESERVE WASHINGTON          18,000,000          448          NCR            2            B
                                                MONUMENT.                                                                                               
NATIONAL CAPITOL PARKS-CENTRAL...............  REPAIR MONUMENT CORES AND SEAWALLS...      78,600,000          731          NCR            1            L
NATIONAL CAPITOL PARKS-CENTRAL...............  PROVIDE FORDS THEATRE HANDICAPPED           7,900,000          790          NCR            2            B
                                                ACCESS.                                                                                                 
NATIONAL CAPITOL PARKS-CENTRAL...............  IMPROVE WASHINGTON MONUMENT ACCESS...       9,690,000          430          NCR            3            L
NATIONAL CAPITOL PARKS-CENTRAL...............  MEMORIAL CORE-RECONSTRUCT EAST BASIN        4,356,000          450          NCR            1            R
                                                DRIVE.                                                                                                  
NATIONAL CAPITOL PARKS-CENTRAL...............  REHABILITATE LINCOLN CIRCLE AREA/           5,502,000          825          NCR            2            R
                                                PROVIDE VIS. ACCESS.                                                                                    
NATIONAL CAPITOL PARKS-CENTRAL...............  REHABILITATE H-1 PARK POLICE STABLE         3,000,000          827          NCR            3            B
                                                and CORRECT DRAINAGE.                                                                                   
NATIONAL CAPITOL PARKS-CENTRAL...............  MEMORIAL CORE-RECONSTRUCT INDIANA and            405E          NCR            1            R             
                                                MAINE AVENUES.                                                                                          
NATIONAL CAPITOL PARKS-CENTRAL...............  DC MALL--ALTERNATIVE TRANSPORTATION         2,640,000         2005          NCR            5            R
                                                MODES.                                                                                                  
NATIONAL CAPITOL PARKS-CENTRAL...............  RECONSTRUCT INDIANA and MAINE AVES.,       29,172,000          405          NCR            3            R
                                                EASTBOUND.                                                                                              
NATIONAL CAPITOL PARKS-CENTRAL...............  RECONSTRUCT JEFFERSON DRIVE..........       2,904,000         405B          NCR            3            R
NATIONAL CAPITOL PARKS-CENTRAL...............  RECONSTRUCT ROADS, EAST POTOMAC PARK.       5,016,000         405C          NCR            3            R
NATIONAL CAPITOL PARKS-CENTRAL...............  RECONSTRUCT LINCOLN MEM. CIRCLE and         3,960,000         405D          NCR            1            R
                                                APPROACHES.                                                                                             
NATIONAL CAPITOL PARKS-CENTRAL...............  RECONSTRUCT CONSTITUTION AVE.........       7,128,000         405G          NCR            3            R
NATIONAL CAPITOL PARKS-EAST..................  RESTORE FORT WASHINGTON..............       4,940,000          106          NCR            2            B
NATIONAL CAPITOL PARKS-EAST..................  REHABILITATE FREDERICK DOUGLASS HOME        1,800,000          738          NCR            2            B
                                                VISITOR CENTER.                                                                                         
NATIONAL CAPITOL PARKS-EAST..................  RECONSTRUCT RENO ROAD OVERPASS             10,560,000          315          NCR            3            R
                                                (SUITLAND PKWY).                                                                                        
NAVAJO NM....................................  CONSTRUCT PEDESTRIAN TRAIL TUNNEL....         840,000          141          SWR            3            L
NAVAJO NM....................................  REHABILITATE ENTRANCE AND CAMPGROUND          660,000          144          SWR            3            R
                                                ROADS.                                                                                                  
NEW JERSEY COASTAL HER. TRAIL................  INITIAL INTERPRETIVE DEVELOPMENTS....       7,800,000          102          NAR            4            L
NEW RIVER GORGE NR...........................  STABILIZE/PRESERVE/ADAPT THURMOND          33,000,000          126          MAR            4            L
                                                HIST. STRUCT./SITE.                                                                                     
NEW RIVER GORGE NR...........................  DUN GLEN/SOUTHSIDE JUNCTION                 3,240,000          155          MAR            4            L
                                                DEVELOPMENT.                                                                                            
NEW RIVER GORGE NR...........................  GRANDVIEW CULTURAL HERITAGE CENTER         36,000,000          158          MAR            4            L
                                                DEVELOPMENT.                                                                                            
NEW RIVER GORGE NR...........................  KAYMOOR DEVELOPMENT..................       3,600,000          156          MAR            4            L
NEW RIVER GORGE NR...........................  HEADQUARTERS DEVELOPMENT (PHASE IV)..       2,700,000         108E          MAR            4            L
NEW RIVER GORGE NR...........................  MIDDLE GORGE ACCESS..................       3,100,000          154          MAR            4            L
NEW RIVER GORGE NR...........................  REHABILITATE PARK ROADS..............       2,640,000          138          MAR            3            R
NEZ PERCE NHS................................  CONSTRUCT WHITEBIRD INTERP FACILITIES         960,000          160          PNR            4            B
NEZ PERCE NHS................................  REPLACE SPALDING ROADS and PARKING...       1,056,000          159          PNR            3            R
NORTH CASCADES NP............................  REPAIR/STABILIZE GOLDEN WEST VISITOR        2,486,000          107          PNR            3            B
                                                CENTER.                                                                                                 
NORTH CASCADES NP............................  REPLACE NEWHALEM and HARLEQUIN              6,072,000          404          PNR            1            R
                                                BRIDGES.                                                                                                
NORTH CASCADES NP............................  PROVIDE STEHEKIN EMPLOYEE HOUSING....       1,200,000          369          PNR            5            H
NORTH CASCADES NP............................  DEVELOP JOINT US/CANADIAN UTILITIES         3,000,000          391          PNR            4            U
                                                AT HOZOMEEN.                                                                                            
NORTH CASCADES NP............................  DEVELOP/IMPROVE HIGHWAY 20 FACILITIES       2,160,000          388          PNR            1            R
NORTH CASCADES NP............................  RECONSTRUCT CASCADE RIVER ROAD.......         792,000          343          PNR            1            R
NORTH CASCADES NP............................  REHABILITATE STEHEKIN ROAD...........       1,980,000          344          PNR            1            R
NORTHWEST ALASKA AREAS.......................  CONSTRUCT VISITOR CTR./HEADQTRS. and       10,510,000        100KZ          AKR            4            B
                                                MTNCE. FACILITIES.                                                                                      
NORTHWEST ALASKA AREAS.......................  CONSTRUCT KOTZEBUE EMPLOYEE HOUSING..       4,690,000          130          AKR            4            B
OLYMPIC NP...................................  ELWHA DAM REMOVAL/RESTORATION........     126,600,000          404          PNR            2            L
OLYMPIC NP...................................  EXPAND VISITOR FACILITIES AT HOH            4,080,000          405          PNR            5            B
                                                RAINFOREST.                                                                                             
OLYMPIC NP...................................  CONSTRUCT KALALOCH VISITOR CENTER....      10,200,000          360          PNR            5            B
OLYMPIC NP...................................  RECONSTRUCT EAST BEACH and LOG CABIN        4,752,000          311          PNR            1            R
                                                RESORT ROADS.                                                                                           
OLYMPIC NP...................................  CONSTRUCT TWIN CREEK BRIDGE..........         924,000          406          PNR            2            R
OLYMPIC NP...................................  REPLACE FINLEY CREEK BRIDGE..........       1,056,000          407          PNR            3            R
ORGAN PIPE CACTUS NM.........................  REHABILITATE PAVED PUBLIC ROADS......       1,320,000          439          WER            3            R
OZARK NAT SCENIC RIVER.......................  CONSTRUCT REGIONAL CULTURAL/VIS. CTR./      9,600,000          459          MWR            5            B
                                                ADMIN. COMPLEX.                                                                                         
OZARK NSR....................................  RELOCATE CAMPGROUND and CONC. FAC.         12,184,800          103          MWR            2            B
                                                FROM FLOODPLAIN.                                                                                        
OZARK NSR....................................  REHABILITATE PEAVINE ROAD............       4,356,000          506          MWR            3            R
PADRE ISLAND NS..............................  CONSTRUCT SEWAGE TREATMENT FACILITIES       1,046,000          215          SWR            4            U
PADRE ISLAND NS..............................  REHABILITATE/RELOCATE BIRD ISLAND           1,188,000          200          SWR            3            R
                                                BASIN ROAD.                                                                                             
PADRE ISLAND NS..............................  CONTRUCT MAINTENANCE SHOP and STORAGE       2,160,000          188          SWR            5            B
                                                AREA.                                                                                                   
PEA RIDGE NMP................................  RELOCATE OVERHEAD UTILITY LINES......         900,000          134          SWR            3            U
PEA RIDGE NMP................................  CONSTRUCT MAINTENANCE/STORAGE AREA...       1,200,000          111          SWR            5            B
PEA RIDGE NMP................................  CONSTRUCT ELKHORN TAVERN COMFORT            1,200,000          125          SWR            5            B
                                                STATION and PARKING.                                                                                    
PECOS NHP....................................  IMPROVE SEWAGE TREATMENT and                3,480,000          143          SWR            3            U
                                                REHABILITATE RANCH.                                                                                     
PECOS NHP....................................  REHABILITATE ENTRANCE ROAD...........         660,000          137          SWR            3            R
PERRY'S VICTORY andINT PEACE MEML............  CONSTRUCT VISITOR CENTER.............      13,650,000          104          MWR            5            B
PETERSBURG NB................................  PRESERVE/PROTECT EARTHWORKS and OTHER       8,400,000          249          MAR            2            L
                                                PRIMARY RES.                                                                                            
PETERSBURG NB................................  REHABILITATE/DEVELOP INTERPRETIVE/          7,200,000          248          MAR            4            L
                                                VISITOR FACILITIES.                                                                                     
PETERSBURG NB................................  REHABILITATE MAIN PARK ROAD and             1,980,000          132          MAR            3            R
                                                BRIDGES.                                                                                                
PETRIFIED FOREST NP..........................  REHABILITATE PAINTED DESERT INN and         2,851,000          109          SWR            2            B
                                                CABINS.                                                                                                 
PETROGLYPH NM................................  REHABILITATE/EXPAND VISITOR CENTER...       1,156,000            1          SWR            4            B
PETROGLYPH NM................................  FENCE BOUNDARY/REMOVE DEBRIS.........         960,000          103          SWR            2            L
PETROGLYPH NM................................  CONSTRUCT NEW VISITOR CENTER.........      13,080,000          106          SWR            4            B
PICTURED ROCKS NL............................  CONSTRUCT ADMINISTRATION and PUBLIC         3,800,000          168          MWR            5            B
                                                USE FACILITY.                                                                                           
PICTURED ROCKS NL............................  RESTORE LIGHTHOUSE SEAWALL...........         943,200          107          MWR            2            L
PICTURED ROCKS NL............................  REHAB 12 MILES BEACH ROUTE 16........      16,764,000          191          MWR            5            R
PICTURED ROCKS NL............................  PAVING--AuSABLE POINT................         660,000          200          MWR            3            R
PICTURED ROCKS NL............................  PAVE ROAD and PARKING--MINER'S BEACH.         396,000          200          MWR            3            R
POINT REYES NS...............................  RECONSTRUCT TOMALES ROAD.............       1,320,000          261          WER            3            R
POINT REYES NS...............................  PAVE PALO MARIN TRAILHEAD ROAD.......         924,000          262          WER            3            R
PRESIDENT'S PARK.............................  ELIMINATE ENV. HAZARD AT WHITE HOUSE          649,000          473          NCR            1            B
                                                GREENHOUSE.                                                                                             
PRESIDENT'S PARK.............................  IMPLEMENT WHITE HOUSE COMPREHENSIVE        90,000,000          249          NCR            5            B
                                                DESIGN.                                                                                                 
PRINCE WILLIAM FOREST PARK...................  REPLACE CAMPGROUND WATER LINES.......       7,450,000          239          NCR            1            U
PRINCE WILLIAM FOREST PARK...................  CONSTRUCT VISITOR CENTER.............       4,200,000          152          NCR            5            B
PU'UHONUA O HONAUNAU.........................  CONSTRUCT REPLACEMENT OFFICE and            3,458,400          113          WER            5            B
                                                MAINTENANCE SHOP.                                                                                       
PUUKOHOLA HEIAU..............................  RELOCATE VISITOR CTR., ADMIN., and          1,886,400          107          WER            3            B
                                                MAINTENANCE SHOP.                                                                                       
REDWOOD NP...................................  REALIGN DAVISON ROAD.................       4,224,000          186          WER            3            R
RICHMOND NAT BATTLEFIELD PARK................  STABILIZE DREWERY'S BLUFF and              14,400,000          170          MAR            2            L
                                                EARTHWORKS.                                                                                             
RICHMOND NBP.................................  REPAIR/REHABILITATE EXISTING VISITOR       10,800,000          169          MAR            3            L
                                                USE FACILITIES.                                                                                         
RICHMOND NBP.................................  REHABILITATE PARK ROADS..............       2,772,000          129          MAR            3            R
ROCK CREEK PARK..............................  RESTORE HISTORIC PIERCE GRIST MILL...       1,223,000          227          NCR            2            B
ROCK CREEK PARK..............................  REHABILITATE MERIDIAN HILL                 10,471,200          120          NCR            2            B
                                                INFRASTRUCTURE.                                                                                         
ROCK CREEK PARK..............................  CORRECT CARTER BARON STRUCTURAL               684,000          204          NCR            2            B
                                                PROBLEMS.                                                                                               
ROCK CREEK PARK..............................  REHABILITATE ROCK CREEK PARKWAY and        34,452,000          318          NCR            1            R
                                                ADJACENT TRAIL.                                                                                         
ROCKY MOUNTAIN NP............................  CONSTRUCT VEHICLE MAINTENANCE/STORAGE         506,400          278          RMR            3            B
                                                BUILDINGS.                                                                                              
ROCKY MOUNTAIN NP............................  REPLACE OBSOLETE SEASONAL HOUSING....      28,044,000          123          RMR            3            H
ROCKY MOUNTAIN NP............................  UPGRADE FALL RIVER ENTRANCE                 2,443,200          104          RMR            5            B
                                                FACILITIES.                                                                                             
ROCKY MOUNTAIN NP............................  REBUILD BEAR LAKE ROAD...............       4,752,000          324          RMR            3            R
SAGUARO NM...................................  REHABILITATE TUCSON MOUNTAIN ROADS...       9,636,000          255          WER            3            R
SAINT GAUDENS NHS............................  CONSTRUCT MAINTENANCE AND EXHIBIT           7,040,000         121A          NAR            5            B
                                                BUILDING.                                                                                               
SAINT GAUDENS NHS............................  PHASE II DEVELOPMENTS................       6,632,400         121B          NAR            1            L
SALINAS PUEBLO MISSIONS NHP..................  CONSTRUCT ABO VISITOR FACILITIES.....       3,120,000          179          SWR            4            B
SALINAS PUEBLO MISSIONS NHP..................  REHABILITATE ENTRANCE ROADS..........       1,188,000          173          SWR            3            R
SALINAS PUEBLO MISSIONS NHP..................  CONSTRUCT GRAN QUIVIRA VISITOR              3,120,000          178          SWR            4            B
                                                FACILITIES.                                                                                             
SAN ANTONIO MISSIONS NHP.....................  IMPROVE HEALTH, SAFETY, VISITOR             3,111,000          190          SWR            3            B
                                                SERVICES-SAN JUAN.                                                                                      
SAN ANTONIO MISSIONS NHP.....................  REHABILITATE SAN JUAN MISSION               3,960,000          187          SWR            2            B
                                                STRUCTURES.                                                                                             
SAN ANTONIO MISSIONS NHP.....................  REHABILITATE PARKING AREAS...........         792,000          185          SWR            3            R
SAN FRANCISCO MARITIME NHS...................  RESTORE ENDANGERED SHIP C.A. THAYER..      11,004,000          643          WER            2            B
SAN FRANCISCO MARITIME NHS...................  REHABILITATE THREATENED HISTORIC            6,602,400          518          WER            2            B
                                                MUSEUM BUILDING.                                                                                        
SAN FRANCISCO MARITIME NHS...................  COMPLETE RESTORATION OF SAILING SHIP        3,144,000          635          WER            2            B
                                                BALCLUTHA.                                                                                              
SANTA MONICA NRA.............................  REHABILITATE DIAMOND X AREA                 1,572,000          331          WER            3            B
                                                MAINTENANCE FACILITY.                                                                                   
SANTA MONICA NRA.............................  RANCHO SIERRA VISTA RD/SATWIWA NAT AR       1,980,000          226          WER            3            R
                                                (IN. PKG145.                                                                                            
SANTA MONICA NRA.............................  REHABILITATE CIRCLE X CAMPGROUND            1,980,000          290          WER            3            R
                                                ROADS.                                                                                                  
SARATOGA NHP.................................  REHABILITATE TOUR ROADS and WAYSIDES.       7,920,000          159          NAR            2            R
SARATOGA NHP.................................  PRESERVE SARATOGA MONUMENT and SITE..       2,360,000          159          NAR            2            L
SARATOGA NHP.................................  REHABILITATE ROADS AND PARKING.......         396,000          160          NAR            3            R
SAUGUS IRON WORKS NHS........................  PRESERVE/REHABILITATE HIST.                 2,400,000          154          NAR            2            B
                                                STRUCTURES and EXHIBITS.                                                                                
SEQUOIA and KINGS CANYON NP..................  REMOVE FACILITIES AND RESTORE GIANT         8,200,000          200          WER            2            L
                                                FOREST.                                                                                                 
SEQUOIA and KINGS CANYON NP..................  COMPLETE WUKSACHI VILLAGE                  13,900,000          130          WER            2            U
                                                INFRASTRUCTURE.                                                                                         
SEQUOIA and KINGS CANYON NP..................  RECONSTRUCT GENERALS HIGHWAY.........      40,920,000          840          WER            3            R
SEQUOIA and KINGS CANYON NP..................  CONSTRUCT/REPLACE LODGEPOLE HOUSING..      55,020,000          259          WER            5            H
SEQUOIA and KINGS CANYON NP..................  REPLACE CEDAR GROVE BRIDGE...........       3,960,000          336          WER            3            R
SEQUOIA and KINGS CANYON NP..................  PAVE GRAVEL SECTION AT MINERAL KING..       6,600,000          541          WER            5            R
SEQUOIA and KINGS CANYON NP..................  RECONSTRUCT GENERALS HIGHWAY (PHASE        16,500,000          841          WER            3            R
                                                II).                                                                                                    
SHENANDOAH NP................................  REPLACE TRAILERS/CONSTRUCT EMERGENCY       25,100,000          446          MAR            1            H
                                                FACILITY.                                                                                               
SHENANDOAH NP................................  REHABILITATE WATER/SEWER/FIRE SYSTEMS      11,800,000          455          MAR            1            U
SHENANDOAH NP................................  REHABILITATE STORM-DAMAGED TRAILS....      12,000,000          456          MAR            2            L
SHENANDOAH NP................................  REHABILITATE VISITOR FACILITIES......       4,800,000          457          MAR            3            L
SHENANDOAH NP................................  RECONSTRUCT SKYLINE DRIVE............      29,040,000          125          MAR            3            R
SHILOH NMP...................................  STABILIZE RIVERBANK..................       2,600,000          134          SER            2            L
SHILOH NMP...................................  RESURFACE TOUR ROADS, INCL. SHOULDER        3,300,000          138          SER            3            R
                                                and DRAINAGE.                                                                                           
SLEEPING BEAR DUNES NL.......................  REHABILITATE STOCKING SCENIC DRIVE          2,215,200          210          MWR            3            B
                                                FACILITIES.                                                                                             
SLEEPING BEAR DUNES NL.......................  CONSTRUCT SCENIC ROAD................      23,364,000          120          MWR            4            R
SOUTHWEST REGION.............................  REHABILITATE HISTORIC OLD SANTA FE          2,100,000          257          SWR            2            B
                                                TRAIL BUILDING.                                                                                         
SOUTHWEST REGION.............................  CONSTRUCT EMPLOYEE HOUSING AT 11            8,600,000          279          SWR            4            H
                                                PARKS.                                                                                                  
STATUE OF LIBERTY NM.........................  COMPLETE HISTORIC SEAWALL                   2,944,000            2          NAR            1            L
                                                REHABILITATION.                                                                                         
STATUE OF LIBERTY NM.........................  STABILIZE 23 ELLIS ISLAND BUILDINGS..      12,000,000          163          NAR            2            B
STATUE OF LIBERTY NM.........................  STABILIZE ELLIS ISLAND HAZARDOUS            3,600,000          161          NAR            1            L
                                                MATERIALS.                                                                                              
STEAMTOWN NHS................................  REHABILITATE PARK ROADS..............       3,960,000          900          MAR            3            R
STEPHEN MATHER TRAINING CTR..................  REHABILITATE TRAINING CENTER COMPLEX.       4,462,000            1         WASO            3            B
SUNSET CRATER VOLCANO NM.....................  CONSTRUCT MAINTENANCE COMPLEX........       1,680,000          152          SWR            5            B
SUNSET CRATER VOLCANO NM.....................  REHABILITATE PARK ROADS..............       4,224,000          900          WER            3            R
THEODORE ROOSEVELT NP........................  RECONSTRUCT/RESURFACE PARK ROADS.....      11,880,000          164          RMR            3            R
THEODORE ROOSEVELT NP........................  CONSTRUCT FLOOD PROTECTION...........         607,200          108          RMR            5            L
THOMAS STONE NHS.............................  FULL SITE DEVELOPMENT AND RESTORATION       7,080,000          108          MAR            4            L
TIMPANOGOS CAVE NM...........................  CONSTRUCT VISITOR/ADMINISTRATIVE            7,605,000          135          RMR            3            B
                                                CENTER COMPLEX.                                                                                         
TIMUCUAN ECOL. and HIST. PRESERVE............  CONSTRUCT VISITOR FACILITIES FOR NEW        9,728,000          128          SER            4            B
                                                AREA.                                                                                                   
TONTO NM.....................................  CONSTRUCT VIS. CTR. RESTROOMS and           1,065,000          138          SWR            3            B
                                                WASTEWATER PLANT.                                                                                       
TONTO NM.....................................  RECONSTRUCT ENTRANCE/PICNIC ROADS and       1,848,000          135          WER            3            R
                                                PARKING.                                                                                                
ULYSSES S. GRANT NHS.........................  PRESERVE/RESTORE GRANT HOME AND SITE.      10,900,000          100          MWR            2            B
UPPER DELAWARE S&RR..........................  DEVELOP INITIAL PARK VISITOR FACILITY       9,000,000          123          MAR            4            L
UPPER DELAWARE S&RR..........................  ROEBLING BRIDGE RECONSTRUCTION (PHASE       2,640,000          110          MAR            5            R
                                                II).                                                                                                    
UPPER DELAWARE SCENandREC.RIVER..............  COMPLETE INITIAL FACILITIES                 5,760,000          130          MAR            2            B
                                                DEVELOPMENT.                                                                                            
VALLEY FORGE NHP.............................  REPAIR/REHABILITATE HIST. STRUCT./         13,200,000          202          MAR            3            L
                                                COLLECTION STORAGE.                                                                                     
VANDERBILT MANSION NHS.......................  PRESERVE VANDERBILT MANSION..........       8,200,000          139          NAR            2            B
VIRGIN ISLANDS NP............................  RECONSTRUCT LAMESHORE ROAD...........       1,980,000         127B          SER            3            R
VOYAGEURS NP.................................  CONSTRUCT VISITOR FACILITIES.........       3,865,000          159          MWR            5            B
VOYAGEURS NP.................................  IMPROVE CRANE LAKE ROAD..............      13,860,000          219          MWR            3            R
VOYAGEURS NP.................................  IMPROVE WEST KABETOGAMA ROADS........         660,000          220          MWR            3            R
WEIR FARM NHS................................  PRESERVE STRUCT./PROVIDE INITIAL           14,594,400          102          NAR            2            B
                                                SUPPORT FACILITIES.                                                                                     
WEIR FARM NHS................................  REHAB PARK ROADS AND PARKING.........         132,000          102          NAR            3            R
WHISKEYTOWN-SHASTA-TRINITY NRA...............  COMPLETE SOUTH SHORE ROAD PAVING.....       3,300,000          109          WER            4            R
WHITE SANDS NM...............................  CONSTRUCT PARK HEADQUARTERS BUILDING.       2,160,000          109          SWR            5            B
WHITE SANDS NM...............................  CONSTRUCT MAINTENANCE/STORAGE               1,800,000          128          SWR            5            B
                                                BUILDING.                                                                                               
WILSON'S CREEK NB............................  REPLACE DETERIORATING WASTEWATER            1,080,000          325          MWR            1            U
                                                PLANT.                                                                                                  
WILSON'S CREEK NB............................  REHABILITATE MAIN ENTRANCE ROAD......         660,000          173          MWR            3            R
WOLF TRAP FARM PARK..........................  ALLEVIATE HAZARDOUS TRAFFIC                41,184,000          208          NCR            1            R
                                                CONGESTION.                                                                                             
WOLF TRAP FARM PARK..........................  EXPAND RESTROOMS and CONCESSIONS.....       4,800,000          130          NCR            5            B
WRANGELL-ST.ELIAS NP and PRES................  CONSTRUCT VISITOR CENTER/HEADQUARTERS       7,100,000        100GL          AKR            4            B
                                                FACILITY.                                                                                               
WRIGHT BROTHERS NM...........................  CONSTRUCT AUDITORIUM ADDITION TO           11,400,000          115          SER            5            B
                                                VISITOR CENTER.                                                                                         
WUPATKI NM...................................  REHABILITATE MTNCE. AREA--SUNSET            1,700,000          101          SWR            3            B
                                                CRATER VOLCANO.                                                                                         
WUPATKI NM...................................  REHABILITATE SEWER LAGOONS...........       2,222,000          192          SWR            1            U
WUPATKI NM...................................  RECONSTRUCT MAIN LOOP ROAD...........       7,920,000          103          SWR            3            R
YELLOWSTONE NP...............................  REPAIR/REPLACE DETERIORATED HOUSING..     100,000,000          817          RMR            3            H
YELLOWSTONE NP...............................  REHABILITATE FISHING BRIDGE                36,000,000          813          RMR            3            L
                                                CAMPGROUND AND MARINA.                                                                                  
YELLOWSTONE NP...............................  RECONSTRUCT ROADS PARKWIDE...........     250,800,000          254          RMR            3            R
YELLOWSTONE NP...............................  UPGRADE MADISON and NORRIS UTILITY          4,716,000          636          RMR            3            U
                                                PLANTS.                                                                                                 
YELLOWSTONE NP...............................  IMPLEMENT LAKE DEVELOPMENT CONCEPT          4,800,000          821          RMR            3            L
                                                PLAN.                                                                                                   
YELLOWSTONE NP...............................  ALTERNATIVE TRANSPORTATION MODES.....       1,320,000         2008          RMR            5            R
YOSEMITE NP..................................  RESTORE VALLEY BY REMOVING/               137,900,000          504          WER            2            L
                                                REDESIGNING FACILITIES.                                                                                 
YOSEMITE NP..................................  UPGRADE FAILING SEWAGE AND WATER           10,500,000          383          WER            1            U
                                                SYSTEMS.                                                                                                
YOSEMITE NP..................................  REHABILITATE FAILING ELECTRICAL             8,100,000          473          WER            1            U
                                                SYSTEM.                                                                                                 
YOSEMITE NP..................................  REPLACE LIFE SAFETY COMMUNICATIONS          5,502,000           44          WER            1            U
                                                SYSTEM.                                                                                                 
YOSEMITE NP..................................  REPLACE/REHABILIATE OBSOLETE HOUSING.      31,440,000          651          WER            1            H
YOSEMITE NP..................................  RELOCATE SOUTH ENTRANCE and MARIPOSA       31,152,000          140          WER            2            L
                                                GROVE FACILITIES.                                                                                       
YOSEMITE NP..................................  RECONSTRUCT GLACIER POINT ROAD.......      15,840,000          843          WER            3            R
YOSEMITE NP..................................  RECONSTRUCT EL PORTAL ROAD...........      26,796,000          505          WER            1            R
YOSEMITE NP..................................  REHABILITATE WAWONA ROAD.............      27,984,000          565          WER            3            R
YOSEMITE NP..................................  RELOCATE/REMOVE HOUSING FROM VALLEY..      34,584,000           46          WER            2            H
YOSEMITE NP..................................  RECONSTRUCT TIOGA ROAD...............      46,200,000          146          WER            3            R
YOSEMITE NP..................................  ALTERNATIVE TRANSPORTATION MODES.....      26,400,000         2003          WER            5            R
YUKON-CHARLEY RIVERS NPRES...................  REHABILITATE HIST. BLDGS. and               3,181,000        100CC          AKR            3            B
                                                CONSTRUCT NEW FACILITIES.                                                                               
ZION NP......................................  CONSTRUCT EMPLOYEE HOUSING...........       8,634,000          178          RMR            3            H
ZION NP......................................  REBUILD PARK ROUTE 7.................       2,508,000          210          RMR            3            R
                                                                                     ----------------                                                   
      Total..................................  .....................................   5,587,776,410  ...........  ...........  ...........  ...........
--------------------------------------------------------------------------------------------------------------------------------------------------------
Objectives:                                                                                                                                             
                                                                                                                                                        
1 = Health and safety.                                                                                                                                  
2 = Resource preservation.                                                                                                                              
3 = Repair/rehabilitation of existing facilities.                                                                                                       
4 = New facilities in a new/developing park.                                                                                                            
5 = Additional facilities in an older/established park.                                                                                                 
                                                                                                                                                        
Work type:                                                                                                                                              
                                                                                                                                                        
B = Buildings: Visitor, Park Support, et cetra.                                                                                                         
H = Housing: Permanent, Seasonal.                                                                                                                       
L = Landscape Work, Site Restoration, et cetra.                                                                                                         
R = Roads: FLHP, Non-FLHP, Bridges, et cetra.                                                                                                           
U = Utilities: Water and Sewer Systems, et cetra.                                                                                                       

    Question. I would also like to know the status of repair work 
necessary for Yellowstone and Glacier National Parks.
    Answer. Yellowstone National Park has a large backlog of repair 
needs due to its expansive and aging infrastructure. Repair work funded 
from park operations includes routine maintenance such as exterior 
painting of buildings, cleaning of drainage ditches, and the patching 
of potholes, that maximizes the life of an asset. Effective routine 
maintenance assumes each road, sewer system, bridge, or building is in 
a minimally acceptable condition. The repairs necessary to bring assets 
from poor condition to good condition are typically accomplished with 
project funding sources such as line item construction and repair and 
rehabilitation.
    Yellowstone housing is characterized by having only 40 percent of 
the units in good or better condition, and over 140 of the units were 
originally intended to be temporary structures. Three sewage systems 
are in extremely poor shape. The Norris geyser basin system failed and 
was shut down in 1995. The sewage plant at Old Faithful is subject to 
spills and is degrading the groundwater. The sewage plant at Madison 
can fail at any time. Up to $300 million is needed to bring the roads 
up to standards.
    Yellowstone management identifies the operational funding currently 
needed to properly maintain assets whose condition warrants proper 
maintenance at $4.5 million per year, and the non-recurring funding 
necessary to bring remaining assets to a reasonable standard at $300 
million for roads and $300 million for buildings and utilities:
    Glacier National Park's backlogged repair needs, estimated at $7.1 
million, are as follows:
  --Maintain and Repair Historic Buildings
  --Rehabilitate Lake McDonald and Headquarters Sewer System
  --Walton rehabilitation of 60-year old two bedroom log cabin and 
        replacement of two trailers with two duplexes
  --Trail Brushing and Tread Repair for Visitor Safety
  --Repair Roof, Administration Building No. 295
  --Repair and Paint Headquarters Buildings
  --Stripe Centerline on Park Roads
  --Paint Interior/Exterior and Rehabilitate Drinking Water Tanks
  --Chip Seal Damaged Roads throughout Park
  --Rehabilitate St. Mary Visitor Contact Station
  --Rehabilitate Many Glacier Camptender's Cabin
  --Rehabilitate Swiftcurrent Lookout
  --Rehabilitate Scalplock Fire Lookout
  --Repair Rising Sun Caretaker's Cabin
  --Stabilize/Repair St. Mary Gas House
  --Rehabilitate Sewer Lines in Headquarters
  --Rehabilitate two Mission 66 Houses
  --Repair Headquarters Maintenance Buildings
  --Rehabilitate Coal Creek Patrol Cabin
  --Rehabilitate St. Mary Campground Septic System
  --Rehabilitate Avalanche Area in Conjunction with FlHP
  --Rehabilitate St. Mary Visitor Center Exhibits
  --Restore Historic Housing/Administrative District
  --Parkwide trail repairs
    In addition to the above, Glacier Park estimates that $96 million 
is needed for Going-to-the-Sun road repairs.
    Question. Would you provide this Committee with the scientific 
research that is presently occurring in our national parks? What is the 
system for peer review of this research and who conducts this peer 
review? Is this done on a national or local level?
    Answer. Scientific research presently occurring in or on behalf of 
units of the National Park System ranges through all possible field 
science disciplines from anthropology to zoology. Most of this research 
is sponsored by non-NPS entities, and much of it is sponsored by 
organizations that are not part of the Department of the Interior. For 
1995, about 1,702 individual research projects, excluding cultural 
resources, were conducted, 131 parks hosted one or more of these 
research projects, and the projects were distributed among the broad 
discipline groupings of biology (1,053 projects), physical sciences 
(417 projects), aquatic and marine systems (87 projects), social 
sciences (85 projects), and other (60 projects).
    I know that you have recently asked the National Academy of Science 
(NAS) for a technical report on the science on the bison in Yellowstone 
National Park. It is my understanding that you requested this report be 
completed and in your hands by October of this year. I have to wonder 
how you can expect a clean, thorough, and comprehensive report in this 
time frame, considering that NAS seeks to find consensus and goes 
through an intense peer review process before releasing the results of 
a study.
    Question. To what extent has the team working on the Draft 
Environmental Impact Statement (DEIS) on Yellowstone Bison moved 
towards the release of the DEIS by July 31, of this year?
    Answer. The EIS team is preparing the draft EIS with a team review 
of the draft to occur in late June 1997. Six alternatives have been 
identified and the team is completing the analysis of the effects of 
each alternative. The draft is expected to be completed by the end of 
June, is scheduled to go to the printer in early July, and scheduled to 
be distributed for public review by July 31.
    Question. I am extremely interested in what the process, timing 
etc., will be for a comment period and then decision on a final EIS for 
this purpose?
    Answer. At least a 60 day public comment period is scheduled. The 
agreement between the agencies calls for the Final EIS to be completed 
by January 31, 1998, with records of decision to be completed by March 
31, 1998.
    It has been suggested by your friends that the Natural Regulation 
Plan you have for Parks does not seem to be working.
    Question. With this in mind can you explain to the Committee how 
and why you continue with a failed policy of natural regulation of 
wildlife in Yellowstone National Park?
    Answer. The NPS does not agree that the wildlife management 
policies for Yellowstone have failed. There are currently populations 
of all native mammals in Yellowstone that were historically present and 
the adjacent States have active and successful hunting programs for 
many species. For example, the three States next to Yellowstone harvest 
an average of about 12,000 elk each year. These elk provide a 
tremendous outdoor recreational opportunity as well as a major economic 
benefit to the States surrounding the park. Yellowstone's northern herd 
of elk is the most economically important herd in Montana.
    Question. Mr. Secretary, have you seen the letter from the White 
House, dated April 24, regarding their plans for the bison in 
Yellowstone Park? Can you explain to the Committee the differences in 
your position and that which the White House has detailed?
    Answer. Yes, the Department has received a copy of the letter. 
There are no basic differences in positions. The alternatives being 
analyzed in the EIS all have aspects that ensure maintenance of a 
viable population of free-ranging bison, address bison population size 
and distribution, clearly define a boundary line beyond which bison 
will not be tolerated, address risk to safety and private property, 
protect livestock from risk of transmission of brucellosis, continue 
Montana's brucellosis class-free status, and address brucellosis in 
bison. The scope of this EIS is limited to bison management in 
Yellowstone National Park and adjacent areas of Montana. It does not 
address brucellosis in bison and elk throughout the greater Yellowstone 
area.
    As you know the Greater Yellowstone Interagency Brucellosis 
Committee (GYIBC) has been formed based on the Memorandum of 
Understanding between the Departments of the Interior and Agriculture, 
and the States of Montana, Wyoming, and Idaho. The GYIBC has 10 
objectives that have been agreed to including maintenance of free-
ranging populations of bison and elk and to plan for the elimination of 
brucellosis in bison and elk.
    Bison cannot be the sole focus. The situation must be addressed in 
elk as well, particularly the large elk herds in Wyoming that are 
maintained on State and Federal feeding grounds during the winter and 
have a high prevalence of brucellosis. Technology does not currently 
exist to eradicate brucellosis in bison and elk without capturing and 
slaughtering hundreds and hundreds of bison and tens of thousands of 
elk for many years. Such a capture and slaughter approach will not 
guarantee success.
    As a result, management of risk is a key component of any 
management plan. Another key component is vaccination; however, there 
is currently no vaccine for bison or elk that is known to be both safe 
and effective. The vaccines developed for cattle do not seem to work 
well in bison or elk. Cooperating agencies are conducting extensive 
research to attempt to develop a safe and effective vaccine.
    Question. What is the reasoning and the process behind the cost of 
construction of housing units in our National Parks?
    Answer. The higher costs of housing construction in national parks 
as compared to private sector can be attributed to a number of factors, 
including remote locations, Davis-Bacon wage rates, the Buy American 
Act, requirements of the Small Business Administration Minority 
Business Enterprise Program, the Uniform Federal Accessibility 
Standards, the high first costs of energy efficient products mandated 
by the Energy Conservation Standards for New Federal Residences 
(10CFR435), and policies related to fire suppression equipment in 
Federally owned buildings. While it is often assumed that building on 
Federal lands should be less expensive because there are no land 
acquisition costs, the costs associated with environmental assessments 
required to comply with the National Environmental Policy Act (NEPA) 
and the various sections of the National Historic Preservation Act add 
significant costs to projects. Additionally, the costs of 
infrastructure not typically borne by private sector developers, but 
rather, paid for by property taxes, are an integral part of NPS housing 
costs.
    The goal of the Park Service is to provide adequate employee 
housing only in those park areas where it is absolutely needed. And 
where it is needed, this housing is to be comparable to market rate 
rental housing in the private sector, taking into consideration the 
high costs of service and maintenance in remote areas as well as the 
special needs of the employees who serve in these remote areas. The 
reasoning and the process behind the cost of construction of housing 
units in our national parks is embodied in two funding programs, 1) the 
Line Item Construction Program, and 2) the Housing Replacement Program. 
Each of these programs has a different manner of establishing 
priorities for project funding as discussed below, though the means for 
managing construction costs are similar in both programs.
    With regard to the Line Item Construction Program, the Denver 
Service Center of NPS responded to a 1997 Inspector General report on 
housing implementing an action plan to meet housing needs in a more 
cost effective manner. Key action items to be taken: conduct a value 
analysis at two stages in the process; utilize standardized housing 
designs and specifications whenever possible; and revise NPS Housing 
Guidelines (NPS-76) per the Government Performance and Results Act 
(GPRA), which will update requirements and assure Servicewide 
consistency of park housing. The Housing Replacement Program also 
recently instituted criteria and priority setting systems.
    The Omnibus Parks and Public Lands Management Act of 1996, section 
814, requires changes in the manner and methods of providing employee 
housing. Among these are the revision of the criteria under which 
housing is to be provided, the conduct of physical assessments of 
existing housing in all parks, the development of agencywide priority 
listings by structure, a study to determine the feasibility of 
providing eligible employees with a housing allowance rather than 
housing, and a study to examine the potential benefits and risks 
associated with the sale of Government housing to a cooperative made up 
of field employees. Most of these activities are in progress. Complete 
implementation of the Act may significantly change the way NPS houses 
employees.
    Question. As a follow up, I have to ask if you are aware that the 
cost of constructing a housing unit in Yellowstone National Park is 
double what it is to build a house in Bozeman, Montana, a mere 90 miles 
away in a high cost district within Montana?
    Answer. Construction costs in Yellowstone National Park are higher 
than costs in Bozeman. There are several expenses that are included in 
construction of a home in Yellowstone National Park that are frequently 
overlooked when comparing to the cost of a home on the commercial 
market. Circumstances related to the following components impact the 
final cost:
    Planning and Design: The planning for and design of houses in 
Yellowstone National Park is more complicated than that of houses in 
developed communities. The issues that must be addressed during this 
initial phase range from impacts on cultural and natural resources, to 
ensuring adequate accessibility, to minimizing the visual impact of 
homes on landscapes. This planning often requires time-consuming 
consultation with State Preservation Offices, particularly when 
historic areas will be impacted.
    Frequently, the costs associated with county planning and designers 
in non-park houses are recovered by taxes and impact fees and thus not 
included in the ``price'' of a house. Yellowstone includes the costs of 
these components when identifying the price of a structure.
    Basic Construction: Basic construction costs are more expensive in 
many national parks than in surrounding communities. The short 
construction season, transportation of material and employees, and the 
lack of adequate contractor housing all inflate these costs. By way of 
example, concrete delivered to the Old Faithful area in Yellowstone 
National Park costs $105 per cubic yard. The same concrete delivered in 
nearby Bozeman, Montana, is $65 per cubic yard.
    Construction equipment entering the park is pressure washed to 
prevent the spread of noxious weeds. New housing must also withstand 
snow weighing as much as 150 pounds/square foot and is designed to 
withstand zone four earthquakes (the same seismic zone as San 
Francisco). These stringent requirements, which must be applied to 
homes for Federal employees, are not necessarily applied to the 
``comparable'' homes outside of the park.
    Utility Systems: Housing that can use existing utility systems is 
considerably cheaper than housing for which utilities must be provided. 
In many cases utilities are already in place in non-park 
municipalities.
    Landscaping/Revegetation: Unlike many non-park homes, the 
Yellowstone housing costs include the revegetation necessary to prevent 
erosion and minimize the visual impact on the surrounding landscape.
    Yellowstone National Park and NPS are working hard to reduce 
construction costs where we can and provide more cost-effective housing 
for our employees. The Omnibus Parks Act provides NPS with new 
authorities to expand housing alternatives, to rely more on the private 
sector to finance or supply housing, and to reduce the need for Federal 
appropriations for housing.
    As I have mentioned in my opening statement, the condition of roads 
is terrible in our Parks.
    Question. With this in mind, what is the current road construction 
budget like for the National Parks, and what to you foresee for the use 
of ISTEA dollars in our parks?
    Answer. The Federal Lands Highway Program (FlHP), which includes 
annual funding from the Highway Trust Fund for the Park Roads and 
Parkway Program, was created with enactment of the Surface 
Transportation Assistance Act of 1982. The primary purpose of FlHP is 
to provide a coordinated interagency program to address National 
responsibilities with regard to access to the Nation's Federal lands, 
as well as protection of the multi-billion dollar Federal capital 
investment in assets constituted by this extensive road and bridge 
infrastructure. The FlHP established a multi-year funding mechanism 
from Highway Trust Fund user fees generated by the Federal gasoline 
tax, and has provided for development of long-range transportation 
planning and goals that serve the needs of Federal lands. This allows 
local and State governments to concentrate on their own transportation 
responsibilities, but still reap the benefits of the travel and tourism 
generated by national parks and other Federal lands.
    There are some 8,000 miles of public park roads and more than 1,250 
bridges under the jurisdiction of NPS serving units of the National 
Park System. About 60 percent of these roads are paved. The current 
condition ratings of paved park roads are 38 percent ``good''; 22 
percent ``fair''; and 40 percent ``poor/failed''. Of the more than 
1,250 bridges in the National Park System, 35 percent are deficient. In 
1995, some $254 million in costs to visitors, employees, and the 
Government can be attributed to traffic accidents on the national park 
road system. The total current backlog of repair and rehabilitation 
needs for NPS roads and bridges exceeds $2.0 billion, based on Federal 
Highway Administration estimates. At the currently authorized FlHP 
level of $84 million, FHWA engineering analyses indicate that an 
additional one percent of park roads will continue to deteriorate to a 
``poor'' or ``failed'' condition each year. Based on FHWA estimates, 
approximately $120-125 million annually is needed to reverse this rate 
of deterioration.
    Also, several major new construction projects, authorized by 
Congress, remain incomplete. These include the Foothills Parkway, 
Natchez Trace Parkway, Baltimore Washington Parkway, Chickamauga-
Chattanooga Route 27 Bypass, and Cumberland Gap National Historic Park 
Tunnel. Currently there are no designated funds to complete these 
projects. It is estimated that $350 million is needed to complete these 
unfinished projects.
    In response to many years of funding shortfalls, and to maximize 
use of limited fiscal resources, NPS in cooperation with the FHWA are 
currently developing enhanced investment strategies using various 
management systems to influence future program focus. Factored into 
this strategy as a key component is the need to address the congestion 
and associated resource concerns that have become an increasingly 
serious problem in national parks. Alternative transportation modes 
need to be considered, where appropriate, to handle the rapidly growing 
traffic demands and to reduce the resource impacts associated with 
increasing numbers of visitors. A study on alternative transportation 
in parklands was submitted to Congress in 1994. A Presidential 
memorandum dated April 22, 1996, directed the Secretary of the 
Interior, in consultation with the Secretary of Transportation to 
enhance the access to and mobility in our Nation's parks. It is 
estimated that $5-15 million annually is needed to initiate a multi-
year program of planning efforts and projects for alternative 
transportation systems in such parks as Yosemite, Yellowstone, Denali, 
Zion, and Grand Canyon National Parks.
    In summary, the Administration is requesting a total of $161 
million beginning in fiscal year 1998 under the Federal Lands Highway 
Program, subject to Congressional reauthorization of the program, which 
will be utilized to address National Park Service Road and 
Transportation needs as follows:
  --$120-125 million annually to prevent further deterioration of the 
        paved park road and parkway infrastructure to ``Poor'' or 
        ``Failed'' condition.
  --$25-35 million annually to complete construction of Congressionally 
        authorized parkway projects.
  --$5-15 million annually to implement alternative transportation 
        systems in selected parks.
    As you know, Interior has a number of agencies working in the 
Greater Yellowstone Area. Some Federal non-Interior agencies are also 
there. I'm not certain how much duplication of effort, focus on good 
science for management decisions and sharing of information and data 
there is.
    Question. I've been wondering if we could get a neutral party who 
could do some objective analysis involved with these agencies so that 
we can better discover, collect, process, and distribute information. 
I'd like to see some good scientific data which was available to all 
interested parties. I believe that Montana State University is a 
logical collaborator both because of its location and because of the 
expertise in resource disciplines which it has. Please comment.
    Answer. Processing and distributing technical information is an 
ongoing challenge for all resource managers. In addition to using its 
own information dissemination programs, NPS often seeks the assistance 
of other agencies, such as the Biological Resources Division of the U. 
S. Geological Survey, and the Fish and Wildlife Service. With the new 
Cooperative Ecosystem Studies Units requested in fiscal year 1998, NPS 
would collaborate with colleges and universities, as well as with our 
Federal partners, to compile, process, and distribute technical 
information. The NPS also has several partnerships with non-government 
information organizations to assist us in the dissemination of 
published information and making data available. Often data are 
available through NPS supported programs such as the GIS spatial data 
on the NPS ``homepage'' on the Internet and the prototype inventory and 
monitoring program.
    When the scientific issues become very complex or controversial, as 
is currently the case with bison, elk, cattle, and brucellosis in the 
Greater Yellowstone Area, NPS turns to the National Academy of Sciences 
to compile existing technical information and provide an independent 
assessment of the scientific implications of that information.
    With respect to Montana State University and the Greater 
Yellowstone Area, the University already has been an active partner 
with NPS and other Federal agencies in conducting and reporting 
research about the area. If the increase requested for the Cooperative 
Ecosystem Study Units is funded, the existing expertise of the 
University will give it strong potential to become a partner in any 
Cooperative Ecosystem Studies Unit that might become established for 
the region that includes the Greater Yellowstone Area.
    I have noticed the Parks for Tomorrow Plan, which your Department 
is planning, proposes regulations to place limits on National Parks 
over flights.
    Question. What kind of rule making is being drafted that would 
affect over flights of Glacier and Yellowstone National Parks?
    Answer. In response to the President's April 22, 1996 Memorandum to 
the Departments of the Interior and Transportation on the national park 
over flight issue, NPS and the Federal Aviation Administration have 
jointly established a ``National Parks Overflights Working Group,'' an 
advisory group composed of conservation and aviation interests who have 
until September 1997, to craft recommendations on what such a rule 
ought to look like. Until this group finishes its deliberations, the 
shape of the rule and how it would affect commercial sightseeing air 
traffic over Glacier and Yellowstone National Parks is unclear.
    Question. Is the Department scoping the public from those 
communities surrounding the parks on these proposals?
    Answer. The recommendations of this advisory group will be put into 
the form of a Notice of Proposed Rulemaking which will be used to 
solicit public comments from all affected parties.
    I would like also to commend NPS for the efforts they have made in 
preservation of the thousands of historic structures in the parks.
    Question. Is each Park responsible for prioritizing the 
maintenance/preservation schedule, or is there a general outline for 
determining priority? I am concerned about the deferred maintenance on 
the historic lodges and supporting infrastructure in both Yellowstone 
and Glacier.
    Answer. Each park is responsible for prioritizing the maintenance 
and preservation schedule for historic structures in the park based 
upon several factors including the level of significance of the 
structure, the condition of the structure, the location of the 
structure, the types and severity of deleterious impacts on the 
structure, and the usability of the structure. The weight of these 
factors is determined by the park in concert with their overall mission 
and available resources.
    Question. Would it be possible to allow the concessionaire a longer 
term so that they would be able to make the improvements and then 
capitalize that investment?
    Answer. Concession contracts are limited by statute to a maximum 
term of 30 years. However, experience has shown that long-term 
contracts are not in the Government's best interest. Therefore, 10 to 
15 year contracts are typical for larger operations with investment 
requirements.
    To determine an appropriate term, a financial analysis is performed 
prior to the issuance of any contract. One of the purposes of this 
analysis is to determine what length of time would be required for a 
concessionaire to earn a reasonable profit in relation to the capital 
invested and the obligations assumed. In contracts with significant 
construction requirements, an analysis of the present value of the net 
cash flows is performed and compared to industry averages. The proposed 
term of the contract is then adjusted until the projected returns fall 
within the industry average.
    Question. Could you please explain to the Committee what the 
Administrations Heritage Initiative will accomplish?
    Answer. The funds requested in the fiscal year 1998 NPS budget are 
to implement a program of heritage areas pursuant to the authorization 
contained in the Omnibus Parks Act of 1996. The requested funds will 
provide a program of direct grants to eligible heritage areas, as well 
as technical assistance.
                   minerals management service (mms)
    Mr. Secretary, I want to ask you about a proposal I understand MMS 
is making to do away with the current crude oil royalty valuation 
program.
    If I understand the proposal correctly, producers--including 
independents in Montana--would be expected to pay royalties on some 
price related to futures contracts on the New York Mercantile exchange 
instead of the price they actually receive for their oil. I also 
understand that, to set that price, MMS would require new data 
gathering and then a complex calculation of so-called ``differentials'' 
to establish a price in Montana.
    Question. Has the Interior Department conducted a study estimating 
what it would cost MMS to implement and administer its proposed oil 
valuation scheme and what it would cost the affected States and oil and 
gas lessees to comply with that scheme and subsequent changes to it if 
the Interior Department were to adopt it as an interim final rule and 
then change it based on the information and experience it develops 
while the interim rule is in effect?
    Answer. In its Determination of Effect of Rule (DOER), MMS 
estimated the cumulative industry cost of submitting a proposed form to 
enable MMS to calculate location differentials at about $800,000 
annually. The MMS also estimated its total yearly cost to collect and 
analyze the data received, and publish resulting location 
differentials, at about $20,000 annually. As the DOER noted, there 
would also be undetermined up-front computer programming and other 
administrative costs to MMS and industry to make their computer systems 
conform with the proposed reporting requirements.
    The DOER estimated a yearly royalty increase of about $54 million 
resulting from the proposed rule. Among other impacts noted were 
pricing certainty and reductions in audit efforts. The DOER also noted 
that the rule would have no obvious negative effects on State or local 
governments because the proposed rule is expected to provide additional 
royalties to them without added cost.
    Finally, an interim final rule was only a possibility raised for 
comment in the preamble to the proposed rule. Even if an interim final 
rule were implemented, there would be no way to estimate costs of 
changing it until we knew what form the changes would take.
    Question. If it has conducted a cost study, what information, if 
any, did it obtain from States and oil and gas lessees in the course of 
its study?
    Answer. Members of the State and Tribal Royalty Audit Committee and 
the Western States Land Commissioners participated in the rulemaking 
effort on behalf of the States. States were thus kept informed of 
progress of the rule and expressed no concerns about implementation 
costs. In response to the December 1995 Advance Notice of Proposed 
Rulemaking (ANPR), many industry respondents said they could not 
participate in the rulemaking process because of various ongoing 
litigation regarding oil valuation. Thus, MMS received no direct input 
from industry on cost concerns while drafting the proposed rule.
    Question. Has the Interior Department prepared any kind of a study 
which estimates the cost of administering a program in which the 
government would take its oil inkind as an alternative to implementing, 
administering and complying with its NYMEX oil valuation scheme?
    Answer. The MMS has a study underway to evaluate both oil in kind 
as well as gas in kind. The MMS doesn't believe the entire oil royalty 
share would be taken in kind at any given time. There still would be an 
ongoing need for effective rules for valuing that portion of oil not 
taken in kind.
    Before MMS moved forward with a royalty on natural gas, they tested 
a pilot project on a payment inkind basis.
    Question. Would it not be just as sensible and prudent of the 
Department of the Interior to pilot test its NYMEX scheme before 
imposing such massive and radical change on our oil and gas producers?
    Answer. The concept of pilot testing normally has merit. But the 
overriding factor in pushing forward with a revised rule is to assure 
that a fair royalty return is realized on public oil resources. The 
existing regulations need modification, and MMS believes an index-based 
procedure (NYMEX or, in California, Alaska North Slope spot prices) 
will better assure proper royalty receipts. The MMS believes that 
further delay would result in loss of revenues to which the States and 
public are entitled. In fact, in response to the ANPR, some States 
commented that MMS should immediately put in place an interim, index-
based rule.
                       general interior questions
    As you know, Whirling Disease is a special concern in Montana, for 
economic, recreational and other reasons. The Fish and Wildlife Service 
(FWS) has undertaken some internal research and activities to combat 
it. We also have the very effective National Partnership on Management 
of Wild and Native Cold Water Fisheries in Bozeman.
    Question. What are your plans for combating Whirling Disease in 
fiscal year 1998 and how can we effectively continue these important 
initiatives?
    Answer. In fiscal year 1997, FWS was appropriated $1.5 million for 
fish disease work with an emphasis on whirling disease. Of this amount, 
$600,000 has been directed toward the development of a National Wild 
Fish Health Survey and Data Base; $500,000 has been provided to the 
National Partnership for the Management of Wild and Native Cold Water 
Fisheries (Partnership) to support research aimed at combating and 
controlling whirling disease; $300,000 has been directed toward 
specific cooperative research projects related to whirling disease; and 
$100,000 has been allocated for on-the-ground whirling disease projects 
in Montana. The fiscal year 1998 President's Budget maintains funding 
levels of $1.5 million to continue efforts to control the spread of 
whirling disease and other fish diseases.
    The FWS will continue to take a variety of approaches to control 
the spread of whirling disease. The FWS is currently funding research 
to develop rapid, cost effective ways of detecting the parasite in both 
the fish and worm host. Other research is aimed at determining why the 
disease is problematic in some trout (and strains) and not others. 
Laboratory and field test are being conducted exposing different 
strains to the parasite to determine if there might be certain strains 
or species of fish that are less susceptible to the disease. If a 
resistant species can be found, fishery managers may have more options 
of managing around the disease in areas of special concern. The FWS 
also determines the health status of wild stocks nationwide, not only 
for the presence of whirling disease, but other dangerous pathogens as 
well. Therefore, FWS is developing a national database to share this 
information with all researchers and fishery managers so that they may 
have more options for controlling and protecting valuable stocks of 
fish. Mr. Secretary, you and I have opposite opinions of what the role 
of grazing on public lands is and should be. I feel that it is 
necessary for the future condition of our public lands, considering 
that we have greater numbers of wildlife than in years past, and that 
this land is in the best shape it has been in decades.
    Question. With this in mind, why is it that each and every agency 
within the Department has different rules and regulations on the lands 
that they manage?
    Answer. This Administration has placed emphasis on managing Federal 
land so as to improve the health of entire landscapes, with a 
coordinated management approach that often transcends jurisdictional 
boundaries. Nevertheless, the Department of the Interior agencies 
manage lands for different purposes, as required under land use laws 
and organizational missions established by Congress. For example, the 
BLM provides for multiple uses; these include resource consumption 
(e.g., grazing), and recreation, with no one use considered to be 
primary. The National Wildlife Refuge System is designed primarily to 
preserve land and water habitat to conserve living resources. Separate 
legislation directs the Park Service to preserve natural and historic 
resources and to provide for the public's enjoyment of its lands in 
perpetuity.
    Question. I would be interested in how many different proposed 
rules and regulations the Bureau of Land Management (BLM) and the other 
related agencies in the Department has put forth this year? How does 
this compare to previous years?
    Answer. The BLM has published 21 proposed rulemakings this fiscal 
year while the rest of the agencies in the Department have published 
82. These numbers are higher than for an average year because of the 
Administration's initiative to consolidate regulations.
    Question. What is the purpose of the Secretary issuing policy 
statements directly opposed to language placed in the fiscal year 1997 
appropriations bill regarding the rights-of-way issue or Revise Statute 
2477?
    Answer. By policy statements the Department understands the 
question to refer to a memorandum from Secretary Babbitt dated January 
22, 1997, in which interim guidance is provided in the absence of a 
final R.S. 2477 rule. This memorandum does not contravene the language 
in the Department's fiscal year 1997 appropriation that restricted 
development of an R.S. 2477 rule.
    One hundred and ten years after its enactment, the R.S. 2477 
statute that governs rights of way across public lands was repealed by 
the Federal Lands Policy and Management Act of 1976. The repeal did 
not, however, terminate already existing highway rights-of-way created 
under R.S. 2477. Two decades after its repeal, the profusion of 
unresolved claims still presents a planning and management problem for 
Federal land managers and other landowners, and uncertainty for 
potential right-of-way holders and users of public lands.
    On August 1, 1994, the Department published a proposed regulation 
to settle the controversy. The proposed regulation would clarify the 
meaning of important terms in R.S. 2477 and establish an administrative 
process for determining how many claims are valid and where they are. 
The comment period closed on August 1, 1995, after the Department 
received more than 3,200 comments. The Department did not finalize the 
regulations, since the fiscal year 1996 Interior Appropriations Act 
prohibited developing, promulgating, or thereafter implementing a rule 
concerning R.S. 2477. The fiscal year 1997 Interior Appropriations Act 
allowed the Department to work on R.S. 2477 regulations, but stated 
that no final rule or regulation pertaining to recognition, management 
or validity of rights-of-way pursuant to R.S. 2477 shall take effect 
unless expressly authorized by an Act of Congress.
    In the absence of a final rule, the Department issued the January 
22 statement to provide some broad guidance to BLM and the Department's 
other land managing agencies in handling right-of-way claims under R.S. 
2477. Such guidance was necessary given the ongoing confusion over 
unresolved right-of-way claims.
    The Administration has come out in the past few days and stated 
that they have reached an agreement with the members of the 
Congressional budget negotiations team on the issue of the Crown Butte 
Mine located in southern Montana.
    Question. What are the exact impacts that this agreement will have 
on Land and Water Conservation Fund projects currently in the budget 
process on the list of priorities within the Department?
    Answer. The agreement that was reached as part of the Bipartisan 
Budget Agreement calls for funding for the New World Mine project that 
will not have any impact on those projects identified as priorities in 
the President's fiscal year 1998 Budget. The funding requested for the 
New World Mine project is in addition to that requested in the 
President's Budget.
    Question. What is your understanding of where the EIS process is, 
related to the Crown Butte Mine?
    Answer. The New World Project EIS was halted as a condition of the 
New World Mine Agreement of August 12, l996. Crown Butte Mines, Inc., 
the project proponent who was financing the preparation of the EIS, was 
a party to the Agreement. Specifically, Crown Butte Mines, Inc. placed 
its permit application into suspension and the Forest Service and the 
State of Montana, as joint leads on the project, accordingly ceased any 
further action.
    Question. Is it done and what are the scientific results of the 
process?
    Answer. The project was at the stage of a preliminary draft EIS 
when action was halted and therefore results of the scientific analysis 
were incomplete.
                                 ______
                                 
          Questions Submitted by Senator Kay Bailey Hutchison
                           esa budget overall
    You seek additional funding for the Endangered Species Act (ESA) 
program of $11.4 million. The ESA has not been reauthorized, however, 
and is badly in need of reform. The ESA as presently implemented has 
failed to reach the goal of species recovery: no species has recovered 
primarily as a result of the ESA and most species claimed by the Fish 
and Wildlife Service (FWS) to have achieved 75 percent of their 
recovery objectives are not beneficiaries of successful ESA actions. 
Further, numerous species have been incorrectly listed as threatened or 
endangered and Government data is too poor to demonstrate a general 
trend that protected species have been assisted. Most importantly, the 
ESA as now implemented severely restricts the reasonable use and 
enjoyment of private property in violation of the Fifth Amendment of 
the United States Constitution.
    Question. Given these failures of the ESA, how can you justify 
increased spending for programs under the ESA, prior to reauthorization 
by Congress and necessary changes to the administration of the Act?
    Answer. To the contrary, the Administration believes that the 
current ESA is an effective and flexible tool for maintaining 
biodiversity for current and future generations while at the same time 
allowing responsible economic development to proceed. At the same time, 
the Administration is currently engaged in working cooperatively with 
the Senate Environment and Public Works Committee in aiding their 
efforts to reauthorize an even more effective Endangered Species Act.
    Over the past several years, the Administration has implemented a 
series of policies to improve the effectiveness of the ESA while 
enhancing its flexibility for businesses and private landowners. Full 
funding at the fiscal year 1998 President's Budget level of $78.8 
million for the endangered species program will allow economic 
development to continue while maintaining biodiversity.
    The Administration's March 6, 1995, announcement of Ten Principles 
For Federal Endangered Species Act Policy provides an overview of the 
Administration's approaches to minimize economic and social impacts on 
the economy, on private property, and the affected public. The Ten 
Principles are:
    1. Base ESA decisions on sound and objective science.
    2. Minimize social and economic impacts.
    3. Provide quick, responsive answers and certainty to landowners.
    4. Treat landowners fairly and with consideration.
    5. Create incentives for landowners to conserve species.
    6. Make effective use of limited public and private resources by 
focusing on groups of species dependent on the same habitat.
    7. Prevent species from becoming endangered or threatened.
    8. Promptly recover and de-list threatened and endangered species.
    9. Promote efficiency and consistency.
    10. Provide State, tribal, and local governments with opportunities 
to play a greater role in carrying out the ESA.
    The following section discusses key implementation actions which 
have struck the proper balance between economic development and 
biological diversity. Following this overview, an in-depth discussion 
of one of these actions--Habitat Conservation Plans--will provide 
further information.
    Candidate Conservation partnership efforts with Federal and State 
landowners and the private sector have been designed to avoid potential 
listings and litigation gridlock. Given the fiscal year 1998 
President's Budget request of $4.9 million for the candidate 
conservation program, FWS will be able to work on 292 actions.
    More is also being done with the use of Habitat Conservation Plans 
(HCP) to ease the regulatory burdens of the ESA on private landowners. 
The FWS estimates that it will work with 400 partners on HCPs given the 
fiscal year 1998 President's Budget request of $26.5 million for the 
consultation program thus demonstrating the flexibility of the ESA as 
it relates to the needs of private landowners. The Administration has 
produced concrete results with these HCPs. In the Pacific Northwest, 
the approved HCPs with State and private landowners cover over 4.2 
million acres in the States of Washington, Oregon, and California.
    Additional steps have been taken to provide landowners with 
certainty regarding potential future impacts of ESA actions. The ``no 
surprises'' policy assures private landowners participating in HCPs 
that no additional requirements will be imposed on plan participants 
for species covered by a properly functioning HCP.
    An HCP seeks to maintain adequate protection measures for species, 
while allowing for development activities. These plans often call for 
land protection or acquisition costs at the local level. The fiscal 
year 1998 President's Budget continues the Section 6 HCP land 
acquisition grants at $6 million to provide grants-to-states to augment 
and complement land acquisition required at the local level as a result 
of the HCP planning effort.
    The ``safe harbor'' program encourages landowners to voluntarily 
provide habitat for listed species. Under this program, private 
landowners with assistance from the FWS or with other qualified Federal 
or State agencies develop a management program to be carried out on 
their lands for the benefit of listed species. Based on such a program, 
a safe harbor agreement is entered into by FWS and the landowner. The 
FWS, in turn, will issue the private landowner a permit for the future 
take of listed species above the existing baseline conditions at the 
time of the agreement. Over 37 of these strictly voluntary agreements, 
mostly in the Southeast and the West, have been or are being developed. 
In the past year, for the Sandhill area of North Carolina alone, 18 
non-Federal landowners have been given safe harbor agreements and it is 
anticipated that an additional 15 will be developed this year.
    The Administration has also developed an innovative way to avoid 
placing a significant and unnecessary regulatory restraint on thousands 
of private landowners in the Pacific Northwest hoping for 4(d) rule 
relief. Implementation of the 4(d) rule for the northern spotted owl 
would relieve certain prohibitions on private lands within the range of 
the owl. The FWS expects landowners will participate more readily in 
conservation and recovery activities because of the relief provided by 
the 4(d) rule.
    The Administration plans to propose species for delisting and 
downlisting in fiscal year 1998. Up to 25 species will be evaluated for 
possible delisting in fiscal year 1998, provided the funding requested 
in the President's Budget is appropriated. The Administration strongly 
believes that the public is best served by removing species from the 
list of threatened and endangered species once recovery has been 
achieved. This results in a decreased cost and regulatory burden on the 
public and State and Federal agencies. To this end, FWS is working hard 
to recover as many species as possible in an expeditious manner. The 
FWS is responsible for both planning and implementing recovery actions 
for listed species, and accomplishing this recovery mission is 
contingent upon the funding in the fiscal year 1998 President's Budget. 
The result of successful recovery planning and implementation is 
downlisting or delisting species.
    The Administration has used the nonessential experimental 
population status to reintroduce both California Condors and grey 
wolves into the wild. This status permits greater management 
flexibility and helps to meet the concerns of private landowners. Both 
reintroductions are being carefully watched; but initial results have 
exceeded expectations.
    The HCP strategy was designed to reduce conflicts between 
endangered species conservation and other land uses on specific parcels 
of land. The overall program has worked very well; by the end of fiscal 
year 1996, FWS had issued 197 permits and 15 permit amendments. By the 
end of fiscal year 1998, given the increased funding requested in the 
President's Budget for the consultations program, FWS projects there 
will be 400 complete HCPs or HCPs in development. To put this in 
perspective, in 1992, only 14 HCPs were approved.
    The Administration has produced concrete results with these HCPs. 
For example, as of January 31, 1997, in the Pacific Northwest, the 
approved HCPs with State and private landowners cover over 4.2 million 
acres in the States of Washington, Oregon, and California. The FWS is 
currently working with the States of Washington and Oregon, the City of 
Seattle, Weyerhaeuser Company, Plum Creek Timber Company, Georgia 
Pacific, Louisiana Pacific, Murray Pacific, Arcata Redwoods, Simpson 
Timber Company, and many others in the development and implementation 
of HCPs.
    This program has been successful because the Department has forged 
strong partnerships with private, local, and State landowners to find 
innovative solutions that are biologically, economically, and 
politically feasible for all parties, and conserve listed species.
    The growth in HCPs is due to several factors, primarily the greater 
incentives that have been offered to landowners. Previously, the fear 
of new listings, the potential for additional mitigation measures, and 
the potential to have to redo a plan left landowners leery of entering 
into a long-term agreement. The Administration's new ``no surprises'' 
policy (a deal is a deal except under extraordinary circumstances) also 
provides certainty to landowners and encourages them to come to the 
table to develop long-term contracts to protect Threatened and 
Endangered (T&E) species while allowing economic activities to proceed. 
The ``no surprises'' policy has been critical to the willingness of 
landowners to participate in the HCP process.
    Additional factors which have increased the use of HCPs and also 
benefits both wildlife and landowners include: the development of 
multi-species HCPs covering larger geographic areas; substantial 
process improvements detailed in a new user-friendly HCP handbook; 
vastly improved coordination between FWS, the National Marine Fisheries 
Service (NMFS), and other Federal parties; and a change in the FWS role 
from providing technical assistance only to full participation with 
landowners through all stages of the process.
    The HCP Land Acquisition Grants to States program provides grants 
for land acquisition at the local level for approved HCPs. The 
Department considers the states' use of Federal acquisition dollars for 
habitat protection within, and adjacent to, HCP areas to be an 
important and effective mechanism to promote the recovery of threatened 
and endangered species. These acquisition and land exchanges 
complement, not supplant, private and/or local government 
responsibilities required for mitigation related to implementing HCPs. 
Of the $6.0 million available for the program for fiscal year 1997, 
$2.75 million has been allocated as follows:
    Balcones Canyonlands HCP, Texas ($1.0 million): The BCCP is a 
regional HCP that protects 35 listed and candidate species, including 
the golden-cheeked warbler, black-capped vireo, and six invertebrates, 
among others.
    Orange County Coastal Central HCP, California ($0.5 million): This 
HCP covers the California gnatcatcher, peregrine falcon, southwestern 
willow flycatcher, and 34 other rare species.
    Volusia County HCP, Florida ($0.5 million): This plan protects 
three species of nesting sea turtles as well as piping plovers.
    Washington County HCP, Utah ($0.75 million): This HCP covers 34 
listed and candidate species, including the desert tortoise, peregrine 
falcon, and bald eagle.
    The remainder of the funds will be allocated later this year as FWS 
continues to evaluate project proposals. The fiscal year 1998 
President's Budget continues this program at the $6.0 million level.
                        conservation agreements
    In fiscal year 1998, you seek $4.9 million for candidate 
conservation agreements under the ESA. This amount, in addition to 
resources of States, local government, and private parties, represent 
very substantial commitments toward the protection of species. These 
efforts should be considered under the ESA in determining whether 
species should be listed as threatened or endangered and in developing 
recovery plans.
    Question. What steps does the Interior Department plan to take in 
order to ensure that candidate conservation and other similar 
agreements under which parties agree to manage resources to protect 
species, are considered when deciding whether to list a species?
    Answer. Successful candidate conservation partnership efforts with 
Federal and State landowners and the private sector have been designed 
to avoid potential listings and litigation gridlock.
    The FWS enters into voluntary candidate conservation agreements 
with one or more parties to remove the most significant threats thereby 
avoiding the need to list the species. States and private landowners 
support the program because it provides an opportunity to address the 
needs of declining species before they reach the point of listing. They 
can employ innovative approaches to species conservation without 
regulatory burdens that may be present for listed species and in ways 
that consider social and economic needs.
    Proposed listing rules for the following species were withdrawn as 
a result of successful candidate conservation agreements: Arizona 
willow; the Virgin Spinedace in Utah; southern population of the 
copperbelly water snake in Kentucky, Tennessee, and two plants from the 
Peninsular Ranges of southern California.
    Hundreds of conservation actions for candidates and species of 
concern have been conducted under candidate conservation MOUs with 
other Federal agencies as well as through the multi-agency Federal 
Native Plant Conservation Committee. Enforcement actions consist of FWS 
monitoring of the species and if candidate conservation agreements do 
not prevent a listing, they can form the basis of the Recovery Plan 
once the species is listed.
    Given the fiscal year 1998 President's Budget request of $4.9 
million for the candidate conservation program, FWS will be able to 
work on 292 candidate conservation actions in 1998 to reduce or remove 
the need for these species to be listed.
    Important research from the Biological Research Division of the 
U.S. Geological Survey (and other research from other reputable 
organizations) is also used to pinpoint potential ESA ``flashpoints'' 
and help to develop solutions to keep these species from being listed.
    If the conservation efforts are not working, or if the species has 
declined to the point where listing may be necessary, the listing 
process would begin. In order to list (as well as to reclassify or 
delist a species), FWS must follow a strict legal process known as a 
``rulemaking'' (regulatory) procedure. The rule is first proposed in 
the Federal Register and after a public comment period, FWS decides if 
the rule should be approved, revised, or withdrawn. The process can 
take up to a year, or longer in unusual circumstances, and encourages 
the participation of all interested parties, including the general 
public. In some cases, the ``trigger'' to begin the listing process 
originates in the courts or with concerned organizations or 
individuals.
    Once a species has been listed, every action is taken to improve 
protection and recovery of the species, while at the same time 
minimizing economic impacts, assuring fair treatment of landowners, and 
reducing delay and uncertainty through a variety of innovative 
initiatives, including multi-species HCPs and the ``no surprises'' 
policy to allow economic development; streamlined review and approval 
of Federal actions; multi-species recovery plans; and the development 
of ``safe harbor'' agreements with cooperating landowners.
    Question. What steps does Interior plan to take to ensure that 
these agreements are considered when recovery plans are developed for 
species?
    Answer. Species are listed under the ESA solely on the basis of the 
best scientific and commercial data available regarding the status of 
the species. As discussed above, the listing process would only begin 
if the conservation efforts are not working, or if the species has 
declined to the point where listing may be necessary. Also discussed 
above, the initial candidate conservation agreement can provide the 
basis for a recovery plan. The current ESA provides flexibility with 
regard to recovery, and various policies recently implemented by the 
Administration, as well as increasing the role of stakeholders in 
recovery and focusing of Federal lands, will decrease the burden on 
private lands and work towards minimizing the economic effects of the 
ESA on private landowners.
    A new policy--part of the Administration's Ten Point Plan for ESA 
reform--significantly expanded recovery participation beginning in July 
1994. That policy directs that local jurisdictions, private 
organizations, and affected citizens be included in recovery plan 
development and implementation. Also, the public is invited to comment 
on draft recovery plans. These comments can supply important 
information about an affected community and can help to reduce or 
eliminate conflicts with listed species and their habitats. All 
comments are reviewed and addressed--if appropriate--in the final plan.
    Question. What plans do you have to defend such agreements against 
judicial challenges, where necessary to insure Interior will continue 
to meet its obligations under the agreements?
    Answer. The Department plans to defend candidate conservation 
agreements against judicial challenges to meet its obligations under 
the agreements.
                                 ______
                                 
              Questions Submitted by Senator Byron Dorgan
                     Bureau of Indian Affairs (BIA)
                         education construction
    The Ojibwa Indian School, located on the Turtle Mountain 
Reservation, is in desperate need of a new permanent facility. There 
are severe safety deficiencies, asbestos, and structural problems in 
the school's three buildings. In fact, BIA decided in 1994 that these 
buildings, housing 150 students, had to be evacuated and the students 
relocated to temporary portable classroom units. Despite this 
emergency, Ojibwa School is not even on the BIA construction priority 
list. Even if it were, it could be years before a new school could be 
built and students could have the opportunity to learn in a safe 
environment. I find this situation abhorrent.
    Question. When does BIA project that the Ojibwa School will be 
included in the construction priority list?
    Answer. The Department is very concerned about the safety 
deficiencies in the Ojibwe School as well as in other BIA schools. Of 
the total backlog of BIA facility repair need ($890 million), over $680 
million is needed to bring the BIA schools in compliance with health 
and safety and other required codes.
    The Replacement School Facility list of 16 schools was approved by 
Congress in 1993. To date, only seven schools have been funded by 
Congress for construction. The list remains frozen until all the 
remaining schools are funded.
    The BIA requests funding increases every year for repair and 
replacement of schools. In fiscal year 1996 and 1997, Congress reduced 
the education construction program by one third below the request.
    The fiscal year 1998 request includes $49.2 million for Education 
Construction, $18 million over the 1997 enacted level. The request 
includes an additional $10 million to replace Many Farms School in 
Arizona and an additional $8 million to reduce the backlog of education 
facility repair need.
    The BIA is not currently able to project when Ojibwa School would 
be included in a new school construction list. If Many Farms is funded 
as requested in fiscal year 1998, there will remain eight of the 16 
schools on the present list to receive funding. If BIA receives annual 
funding for construction of two additional schools per year, it would 
take until fiscal year 2002 before the entire current list of 16 
schools are funded for construction. Therefore, the earliest that a new 
list would probably be developed is fiscal year 2001. When it is 
determined that a new list should be established, applications will be 
requested from the Tribes/schools, and using approved ranking criteria, 
BIA will determine the ranking order of the individual schools. There 
is no way of knowing where Ojibwa would rank in a national competition 
among schools.
    Question. What actions is BIA taking now or what actions does it 
intend to take in the immediate future to ensure that the severe 
education construction needs on Indian reservations will be met in a 
more timely fashion, either through creative financing mechanisms which 
would use existing construction and repair funding or other proposals?
    Answer. The Administration has requested $5 billion to address 
facility repair needs for public schools across the country. The 
proposal includes a two percent set-aside for the Department of the 
Interior. This is a step toward eliminating the backlog of repair.
    The BIA has examined alternative financing methods in the past. 
Given that lease arrangements, loans, and revenue bonds require 
repayment which is subject to appropriation, opportunities are very 
limited. In addition, many Tribes do not have revenue generating 
opportunities available to public schools.
    In the meantime, BIA continues to examine other options, including 
cost sharing with Tribes and debt servicing legislation that could 
circumvent budget scoring problems.
                        correctional facilities
    The need for additional correctional facilities in Indian Country 
far exceeds existing resources. For example, on the Fort Berthold 
Reservation, there are 3,000 arrests annually, but the jail facility 
that BIA leases only houses eight inmates. Due to this situation, there 
is essentially no deterrence to crime on the reservation. I am 
disappointed that, despite the substantial backlog in the construction 
projects, the fiscal year 1998 budget request contains only $9.1 
million to construct a single jail in Colorado for a Tribe that has 
been court-ordered to immediately address serious facility problems.
    Question. Can you explain in detail what steps BIA will take 
immediately to ensure that there are sufficient and adequate 
correctional facilities in Indian country?
    Answer. The BIA is quite concerned about the backlog of detention 
center facility repair and replacement need in Indian country. 
Unfortunately, as with schools, appropriations have been far short of 
need. Final funding from Congress for fiscal year 1996 and 1997 has 
been less than half of the President's Budget request for the Public 
Safety and Justice facility repair and replacement program.
    In fiscal year 1998, BIA is requesting $16.5 million for the Public 
Safety and Justice construction program, an increase of $12.1 million. 
The increase will fund construction of the Ute Mountain Ute Detention 
Center in Colorado; design of the Salt River Center in Arizona; and an 
additional $2.0 million for repair of existing facilities. The BIA 
would like to respond affirmatively that there is a plan which will be 
enacted to immediately ensure that we have sufficient and adequate Law 
and Order facilities in Indian country. However, as a result of a 
constrained budget, we have been unable to appreciably address the 
national list of 17 detention centers established years ago. Rather, 
our current plan is limited to addressing only those most imminent 
health and safety code and standards at the existing facilities on an 
annual basis. In this regard, the needs are established, prioritized, 
and addressed as funding becomes available.
    Question. Can you tell me what action BIA intends to take with the 
Fort Berthold situation?
    Answer. The Fort Berthold detention facility ranks 17th on the 
Detention Facility Replacement Priority List. In fiscal year 1996 and 
1997, BIA requested funds for the Ute Mountain Ute Detention Center, 
fifth on the List, but Congress did not appropriate the construction 
funds. The fiscal year 1998 budget request also includes funds to 
complete construction of the Ute Detention Center.
    As a result of the slow pace of funding, BIA presently predicts 
that it will take several years before construction begins at Fort 
Berthold. The BIA will provide repair funds to the extent that the 
funds are available, depending on the health and safety needs at Fort 
Berthold as compared to the needs at other facilities.
                           therapeutic model
    The North Dakota delegation wrote to you and OMB Director Raines to 
urge the Administration to provide additional resources for the 
therapeutic model program at the Circle of Nations School in Wahpeton, 
North Dakota. The fiscal year 1998 budget request contains no such 
additional dollars.
    Question. What steps will BIA take to allocate existing or new 
resources to ensure that the special educational, health, and 
psychological needs of the students at the Circle of Nations School are 
met and to ensure the creation of a viable model for other Indian 
educational institutions?
    Answer. The BIA provided additional funds to the school during 
fiscal year 1993 through 1995; the funds were used by the school for 
the therapeutic model program. Due to current fiscal constraints, BIA 
can no longer provide additional support to the school. The BIA 
allocates School Operations to all of the Bureau schools in accordance 
with a legislated distribution formula.
    The BIA staff will continue to work with the school to explore 
additional funding opportunities, including working with the Indian 
Health Service in implementation of the therapeutic model.
                    fish and wildlife service (fws)
    The FWS has for many years actively pursued the purchase of 
wetlands easements within the State of North Dakota. During this time, 
there has been a continuing frustration with the lack of flexibility 
that wetlands easements offer. Most recently, there have been law suits 
filed in the State by producers who had easements on their land. The 
law suits established that FWS had over-extended its interpretation of 
its easement authority.
    Question. What is FWS currently doing to develop a more flexible 
policy on wetlands easement purchases?
    Answer. The FWS policy regarding wetland easements in the prairie 
pothole region for Waterfowl Production Areas allows the FWS to acquire 
the minimum interest in private property that is necessary to 
perpetually protect the small pothole basins found throughout the upper 
Midwest. Landowners continue to own and exercise all other property 
rights.
    The WPA wetland easements protect the potholes from four types of 
threats; draining, burning, filling, and leveling. Any of these 
activities would destroy or diminish natural characteristics of basins, 
thereby reducing their value to migratory waterfowl and other wildlife 
species.
    Accordingly, the wetland easement program allows FWS to meet its 
Congressionally mandated requirement to protect prairie potholes from 
various threats, the greatest of which is drainage, while minimizing 
the affect of FWS acquisition on private enjoyment and use of property.
    The FWS has been extremely helpful in North Dakota in developing 
water storage areas in the Devils Lake Basin through their wildlife 
refuge system. However, the need is continuing to grow with Devils Lake 
expected to rise another six feet or more this year.
    Question. What further initiatives is FWS capable of undertaking in 
order to ensure not only the continued development of wildlife habitat 
in the basin, but also ensuring that the expansion of the lake does not 
completely eliminate water control structures and developed wildlife 
refuges.
    Answer. Currently, FWS has $3.1 million available from previous 
special appropriations to restore drained and expand existing wetlands 
on FWS lands in the Devils Lake Basin. With the continued rise of 
Devils Lake, 10 of the FWS facilities are threatened at Lake Alice 
National Wildlife Refuge and Sullys Hill National Game Preserve. The 
FWS is cooperating with local, State, and Federal efforts to develop a 
basin-wide water management plan and assist in other efforts to resolve 
flooding.
    With the additional work FWS in has taken North Dakota with regard 
to water storage on its lands to alleviate flooding at Devils Lake, I 
am concerned that they do not have adequate funding to properly manage 
these new areas of responsibility.
    Question. Do you plan to allocate additional operations and 
maintenance funding for the FWS in North Dakota for this purpose?
    Answer. Due to operations and maintenance funding priorities for 
the Refuge System both nationally and regionally, there are no plans in 
the President's Budget to increase operation and maintenance funding 
for FWS activities or refuge management in the Devils Lake Basin.
                     u.s. geological survey (usgs)
    North Dakota has been hit with a series of disasters this winter 
and spring. The highest snowfall this century followed by millennial 
flooding have devastated large areas of the State. The USGS has been 
particularly hard hit with many of their gages as well as their 
facilities in Grand Forks damaged.
    Question. Can you provide me an estimate of total damage 
assessments for USGS, what amount has been included in Public Law 104-
208 (The Disaster Supplemental Appropriations and Rescission Act of 
1997) for USGS, North Dakota, and what is the unmet need for full 
repair and restoration of USGS in North Dakota?
    Answer. The funding included in Public Law 104-208 (The Disaster 
Supplemental Appropriations and Rescission Act of 1997) related to 
damages in North Dakota was $840,000:
  --$640,000--repair/replace 20 damaged/destroyed gages, including 
        replacement of equipment.
  --$200,000--replace damaged/lost water quality laboratory equipment 
        and computer equipment. Replace one lost vehicle.
    The USGS also received $4,650,000 in funding in Public Law 105-18, 
the second Emergency Supplemental Act of 1997 for recovery from natural 
disasters. There are no unmet needs or additional funding required for 
full repair and restoration of damaged, USGS equipment in North Dakota.
                      national park service (nps)
    The Lewis and Clark Expedition of 1804-06 traversed territory in 
what became 11 States, including North Dakota. Even before the 
Louisiana Purchase, President Thomas Jefferson was interested in 
exploring the territory west of the Mississippi to seek a water route 
to the Pacific and to learn more about the flora, fauna, and indigenous 
people who resided in the territory.
    In 1803, Congress approved an appropriation for an expedition to 
explore the area west of the Mississippi which was purchased from the 
French in the Louisiana Purchase. President Jefferson chose Lewis and 
Clark to lead the expedition. Their 18-month, 8,000 mile journey added 
immensely to our scientific, geographic, and cultural knowledge of this 
largely unexplored area of the United States. As I am sure the 
Secretary knows, the expedition spent its first winter in Mandan, North 
Dakota. As we approach the bicentennial celebration of this most 
remarkable of events in the annals of American history, I would like to 
ask a few questions.
    Question. What plans are currently underway within the NPS to 
support and promote the Bicentennial of the Lewis and Clark Expedition?
    Answer. The Lewis and Clark National Historic Trail is administered 
from Madison, Wisconsin. The superintendent and trail manager have been 
cooperating with and assisting the Bicentennial Committee of the Lewis 
and Clark Trail Heritage Foundation, our primary private sector 
partner, and the more recently formed National Lewis and Clark 
Bicentennial Council. We believe it is desirable for private sector 
organizations such as these to be the focal point for coordinating the 
bicentennial nationally across all levels. The NPS provided $45,000 
through a cooperative agreement this year to enable the organizations 
to hire a shared executive director. We plan to continue our 
cooperation with them. We will also continue our support as funds are 
available to do so.
    Through a limited amount of Challenge Cost-Share Program funds 
($42,000 in fiscal year 1997), NPS is assisting State and local 
agencies in their efforts to protect sites important to the history of 
the expedition and provide educational information to the public 
through wayside exhibit signs and information brochures. We have 
developed and published a technical assistance document that provides 
information to cooperating interests on how to design, produce, and 
install interpretive signs.
    In regard to the Service's own participation in the bicentennial 
observance, we have formulated goals and objectives to guide the 
development of projects and programs at park units or that might be 
undertaken by the Lewis and Clark National Historic Trail 
administrative staff. A preliminary package of projects and programs is 
being built around those goals and objectives, along with funding and 
other resource requirements, for review by the NPS leadership.
    Five park units--Jefferson National Expansion Memorial, Niobrara/
Missouri National Scenic Riverways, Knife River Indian Villages 
National Historic Site, Nez Perce National Historical Park, and Fort 
Clatsop National Memorial--are directly related to the history of the 
expedition. These individual units, as well as others along the trail 
route that are not directly related to the expedition, are working 
individually with local interests that want to plan for appropriate 
bicentennial events and projects.
    Question. What are your future plans relating to this event?
    Answer. The NPS plans to continue the cooperation with and 
assistance to the private partners, as resources allow, to enable them 
to continue the overall national coordinating role. The NPS will also 
continue to assist State and local interests in preparing for the 
bicentennial through on-the-ground development of interpretive 
facilities using Challenge Cost-Share Program funds.
    Enhancements under consideration include new or rehabilitated 
visitor center and wayside exhibits that reflect the latest research 
and scholarship on the expedition and its cross-cultural contacts, and 
a brochure focusing on the expedition, its scientific and geopolitical 
accomplishments, and implications for United States history would be 
produced and distributed nationwide during the bicentennial period. To 
adequately serve visitors, NPS hopes to be able to augment the level of 
seasonal staffing at targeted sites that might experience the largest 
increases in visitation during the years around the bicentennial.
    Question. How much funding has been allocated within the NPS budget 
for activities associated with the Expedition?
    Answer. The base budget for the Lewis and Clark National Historic 
Trail for fiscal year 1997 is $147,000. In addition, approximately 
$42,000 was allocated from the Challenge Cost-Share Program to assist 
cooperating State and local interests in the protection and 
interpretation of sites important to the history of the expedition. The 
five park units that are directly related to the history of the 
expedition have their own individual operational budgets.
    Although hundreds of events are being prepared all along expedition 
route and in nearby population centers, there are two major events 
associated with the bicentennial--a convention in St. Louis, Missouri 
at the beginning of the bicentennial festivities, and one in Mandan, 
North Dakota the following year.
    Question. Do you intend to allocate any funding to the Lewis and 
Clark Bicentennial Foundation in North Dakota to help with the major 
event being planned in my State?
    Answer. In fiscal years 1996 and 1997, NPS competitively awarded 
$3,000 to $4,000 to the National Lewis and Clark Bicentennial Council 
from the Challenge Cost-Share Program funds to assist the council in 
holding its annual planning conference. The NPS also assisted the 
sponsors of the annual Lewis and Clark Festival in Great Falls, 
Montana.
        interior department disaster estimates for north dakota
    Many other Department of the Interior facilities in North Dakota 
were also damaged as a result of disasters in North Dakota this year.
    Question. Can you provide me with a full accounting of all Interior 
Department facilities, equipment, etc., that were damaged by disasters 
in North Dakota this year?
    Answer. While we do not have a detailed list of equipment that was 
damaged, FWS, NPS, BIA, and Bureau of Reclamation (BOR) facilities and 
USGS equipment that suffered disaster damage in North Dakota in 1997 
are as follows:

                        NORTH DAKOTA STORM DAMAGE                       
                             [Whole dollars]                            
------------------------------------------------------------------------
Department              Facilities and equipment                Amount  
------------------------------------------------------------------------
    USGRepair/replace 20 damaged/destroyed gages,             $640,000  
        including replacement of equipment                              
       Replace damaged/lost water quality laboratory           200,000  
        equipment and computer equipment. Replace one                   
        lost vehicle                                                    
     FWFlood damage at Long Lake, Tewaukon, J. Clark         9,358,000  
        Salyer, Audubon, Arrowwood, Des Lacs, Devils                    
        Lake, Upper Souris National Wildlife Refuges; at                
        Valley City National Fish Hatchery; and Valley                  
        City, Kulm, and Chase Lake wetland management                   
        districts                                                       
     NPRepair campground infrastructure/entrance roads/        210,000  
        trails/seven miles of bison-proof fence at                      
        Theodore Roosevelt NP, Knife River NHS, Fort                    
        Union Trading Post NHS                                          
     BIDunseith Day School                                      15,000  
       Mandaree School                                          58,000  
       Ojibwa School                                            17,000  
       Trenton Indian School                                    10,000  
       Turtle Mountain Elementary                               36,000  
       Twin Buttes School                                       16,000  
       White Shield School                                      14,000  
       Wahpeton Boarding School                                742,560  
     BOMuseum, University of North Dakota, Grand Forks         419,000  
                                                          --------------
           Total                                            11,735,560  
------------------------------------------------------------------------

    Question. How much of these amounts were covered in H.R. 1469?
    Answer. All amounts were covered in H.R. 1469 except for $604,560 
at Wahpeton Boarding School that was unknown at the time of the request 
to Congress.
    Question. What is the unmet need is for each?
    Answer. The unmet need of $604,560 at Wahpeton Boarding School is 
for roofing light buildings and the repair of campus streets and 
sidewalks.
             government performance and results act of 1993
    The Government Performance and Results Act of 1993 (GPRA) directs 
Federal agencies to incorporate performance management by defining the 
agency's mission and establishing definitive goals and quantitative 
performance measures. The NPS planned to publish and distribute a 
revised strategic plan consistent with GPRA in the spring of 1997, and 
to issue an annual performance plan articulating the NPS goals and 
intended results in fiscal year 1998.
    Question. What is the status of the revised strategic plan? Is it 
available yet? If not, when do you anticipate its being published?
    Answer. The NPS anticipates publishing the strategic plan early 
this fall.
    Question. What performance measures will be incorporated in the 
first annual performance plan?
    Answer. The NPS strategic plan contains eight broad mission based 
goals, 31 long term goals, and numerous specific indicators that will 
be incorporated into its first annual performance plan. The mission 
based goals encompass, among other values, natural and cultural 
resource protection, visitor safety and enjoyment, educational, 
recreational and conservation partnerships, and improved management 
systems. Although too numerous and specific to list here, the long term 
goals and performance indicators will be fully incorporated into the 
agency's budget presentation that will be submitted to the Congress for 
the fiscal year 1999 budget cycle.

                         conclusion of hearings

    Senator Gorton. Thank you very much. Thanks for being here. 
The subcommittee will stand in recess awaiting the call of the 
Chair.
    [Whereupon, at 11:45 a.m., Tuesday, May 20, the hearings 
were concluded and the subcommittee was recessed, to reconvene 
subject to the call of the Chair.]




  DEPARTMENT OF THE INTERIOR AND RELATED AGENCIES APPROPRIATIONS FOR 
                            FISCAL YEAR 1998

                              ----------                              

                                       U.S. Senate,
           Subcommittee of the Committee on Appropriations,
                                                    Washington, DC.

                       NONDEPARTMENTAL WITNESSES

    [Clerk's note.--The subcommittee was unable to hold 
hearings on nondepartmental witnesses, the statements and 
letters of those submitting written testimony are as follows.]
    [The statements and letters follow:]

    Prepared Statement of Audrey Gallery, Honorary Chairman, U-505 
                         Restoration Committee

    Thank you, Chairman Gorton, for providing the U-505 Restoration 
Committee with the opportunity to submit testimony to your Subcommittee 
regarding fiscal year 1998 funding for the Department of Interior.
    I serve as Honorary Chairman of the U-505 Restoration Committee. I 
am the cousin of Captain Daniel V. Gallery, Commander of the Navy Task 
Force 22.3 which captured the U-505 submarine off the coast of West 
Africa on June 4th,1944, two days before D-day. As you may know, the U-
505 is a type IX-C German submarine and is the only-man-o'-war captured 
at sea by the U.S. Navy since the War of 1812. The capture of the U-505 
enabled the Allies to break the German code. Within 60 days of its 
capture, all the German U-boats, nearly 900 of them, were disabled, 
thereby substantially hastening the end of the Battle of the Atlantic.
    Acquired by Chicago's Museum of Science & Industry (MSI) in 1954 
and viewed by 20 million people since then, the submarine serves as a 
memorial to the 55,000 Americans killed at sea during World Wars I and 
II. During a twenty-minute guided tour of the submarine and adjacent 
galleries, visitors get a taste of life on board, while also learning 
about the science of World War II submarine warfare. Unfortunately, the 
U-505's current resting place, outdoors in Jackson Park, has exposed it 
to dramatic changes in both temperature and humidity over the past 43 
years. As a result, the interior, hull, and deck of the submarine are 
deteriorating at an alarmingly rapid pace.
    Due to the national significance of this artifact, the U-505 
Restoration Committee was formed in 1996. The Committee's purpose is to 
assist MSI with its plans to restore the U-505 and relocate it to a 
climate-controlled facility next to the East Pavilion, thereby 
protecting it for future generations. MSI also plans to connect the U-
505 enclosure to a $5 million exhibit opened in 1994 entitled Navy: 
Technology at Sea. This 10,000 square-foot gallery inside the East 
Pavilion helps visitors learn the scientific principles associated with 
navigation, communication, ship construction and operation, and 
underwater technologies.
    The new U-505 exhibit would continue a process that began in 1993, 
when MSI began transforming its exhibits into uncommon classrooms where 
families and children could learn the fundamental principles of 
science, technology, mathematics, and history. As part of MSI 2000, the 
Museum's strategic plan to transform itself into a stimulating, state-
of-the-art educational institution, MSI has developed and opened six 
new permanent exhibits totaling around 30,000 square feet. It is 
estimated that because of these new exhibits, MSI's annual attendance 
grew by more than 100,000 visitors in less than three years.
    In 1989, the U-505 was designated a National Historic Landmark. It 
has been placed on the National Park Service's Priority 1 list of 
distressed objects. Since the submarine is threatened with impairment, 
funding for its restoration is authorized based on an amendment to the 
Historic Preservation Act of 1912 [16 USC 470a-e (1), (2) and (3)]. The 
amendment authorizes Congress to set aside funding within the National 
Park Service's Historic Preservation Fund for the restoration of 
facilities designated as National Historic Landmarks and threatened 
with impairment.
    The U-505 Restoration Committee and the Museum are seeking a one-
time appropriation of $6 million, approximately half the cost of 
restoring, relocating, maintaining, and operating the U-505. The rest 
of the funds will be raised by private and local sources. The Museum 
has been solely responsible for the vessel since 1954 and has never 
before requested federal funds to restore or maintain it.
    Mr. Chairman, the U-505 Restoration Committee thanks you for the 
opportunity to submit testimony to your Subcommittee this year.

------------------------------------------------------------------------
                                               1995            1996     
------------------------------------------------------------------------
National Science Foundation:                                            
    Science Club Network (ESI-9154856)..        $236,530        $262,161
    Intergovernmental personnel                                         
     assignment (ESI-9354157)...........          82,191          72,269
Illinois Department of Transportation:                                  
    Underground garage (D-4-017-112)....       3,258,689       6,819,823
    Auto safety exhibit (CP6-1051-147)..  ..............          54,767
Illinois Department of Public Health:                                   
    AIDS Education Program (95G81544)...          63,450           3,145
------------------------------------------------------------------------

                                 ______
                                 

   Prepared Statement of Hunter R. Rawlings, III, President, Cornell 
  University, on Behalf of the Association of American Universities, 
     American Council on Education, National Association of State 
                  Universities and Land-Grant Colleges

    Mr. Chairman and members of the Subcommittee: I am Hunter Rawlings, 
president of Cornell University, a private land-grant university in 
Ithaca, NY. I am also a professor of classics, that is, Greek and Latin 
language and culture, and my particular interests are Greek history and 
Greek historians. It is my privilege to submit this testimony for the 
record on behalf of the Association of American Universities, the 
American Council on Education, and the National Association of State 
Universities and Land-Grant Colleges. Through their combined 
memberships, these associations represent all the public and private 
research universities in the country--institutions that educate large 
numbers of the nation's undergraduate and graduate students and conduct 
the bulk of the country's basic research and scholarship. I appreciate 
this opportunity to testify on their behalf in support of a fiscal year 
1998 budget of $136 million for the National Endowment for the 
Humanities (NEH).
    NEH grants make possible a wide range of cultural endeavors that 
can only be achieved with help and encouragement from the federal 
government. As the philosopher Charles Frankel said, ``Nothing has 
happened of greater importance in the history of American humanistic 
scholarship than the invitation of the government to scholars to think 
in a more public fashion, and to think and teach with the presence of 
their fellow citizens in mind.'' That role, since 1965, has been 
fulfilled admirably by NEH.
    The NEH is not a monolithic ministry of culture or an arbiter of 
public taste such as exists in some other countries. Rather it is a 
remarkably successful and cost-effective mechanism for engaging the 
public more fully in American culture, advancing knowledge, and 
revitalizing education while preserving aspects of our heritage that 
might otherwise be lost.
    Two characteristics of NEH support are particularly noteworthy:
    First, NEH sustains long-term collaborative projects such as 
bibliographies, encyclopedias, dictionaries and critical translations 
that are of national significance but that are unlikely to be funded by 
any single state or institution. Cornell University, for example, in 
cooperation with eight other land-grant university libraries, has 
received NEH support for a two-year project to preserve the most 
significant published materials on the history of state and local 
agriculture and rural life. This rich literature traces agriculture as 
it evolved from a home and family way of life to the business 
enterprises of today. In this project, approximately 6,819 volumes 
published between 1820 and 1945 will be preserved from Alabama, 
California, Connecticut, Florida, Nebraska, New York, Pennsylvania, 
Texas and Wisconsin. Cornell and its collaborators hope to extend their 
work to all 50 states. Their ability to continue the work could be 
jeopardized, however, by budget reductions at NEH.
    Similarly, in 1995, Cornell began the microfilming, cataloging, and 
conservation treatment of its 32,000-volume Fiske Icelandic Collection, 
also with the help of NEH. The Fiske collection contains virtually 
every publication issued in Iceland or written in Icelandic before 
1930, including the first book printed in Icelandic, a New Testament 
published in 1540. One of the premier collections in the world, it is 
essential to the study of the medieval period and attracts scholars 
from throughout the nation and abroad.
    Additionally, an NEH planning grant is helping fund a traveling 
museum exhibit, ``Up the Road on the Season,'' tracing how migrant farm 
labor emerged in the agricultural economy of the northeastern United 
States and how it has figured in the system that has supplied Americans 
with food. The project is enabling Cornell to connect the arts with the 
land and museum lovers with the people who work the land, to link some 
of the best aspects of our diversified American culture, and to bring 
them to citizens throughout the Northeast.
    The second distinctive characteristic of NEH grants is their 
ability to leverage state, local, and private philanthropic investment 
and increase public engagement with the humanities. The imprimatur of 
NEH funding, awarded on the basis of merit as determined by rigorous 
peer review, has a multiplier effect, increasing public participation 
in humanistic endeavors and attracting additional funds. At Cornell, 
NEH's ``Leadership Opportunities in Science and Engineering Education 
Program,'' administered jointly with the National Science Foundation, 
has enabled our Department of Science and Technology Studies to develop 
four undergraduate courses that are a key part of what we believe is 
the most innovative, wide-ranging and rigorous curriculum in humanistic 
and social studies of science and technology in the country. Similarly, 
one of Cornell's most successful archaeology projects, the Aegean 
Dendrochronology Project, has used NEH gifts-and-matching support to 
generate 4,721 contributions from 816 private individuals. This 
partnership of public and private funding ensures that limited 
resources support work of the greatest promise and make it available to 
the greatest number of Americans.
    Mr. Chairman, we recognize the extraordinarily tight fiscal 
constraints under which the Interior Appropriations Subcommittee has 
operated in the past few years and will operate this year. In fiscal 
year 1997, the NEH budget was set at $110 million, an amount 
approximately 36 percent below its fiscal year 1995 level and well 
beyond reductions sustained by most federal agencies. NEH already has 
implemented a major restructuring that has resulted in a reduction of 
NEH's divisions from six to three, a reduction in programs from thirty-
one to nine, as well as the laying off of almost 40 percent of the NEH 
staff.
    The fiscal year 1996 and 1997 budget cuts at NEH have greatly 
constrained the productivity of the NEH/university partnership, and 
they have disproportionately affected the national programs account, 
which has been reduced by 60 percent since fiscal year 1995. The 
programs and research projects within this division of NEH are unlikely 
to be funded by any individual state but will substantially benefit the 
entire nation. They include preservation of brittle books and 
newspapers and those that assist scholars in producing authoritative 
editions of the papers of America's great leaders so that they can be 
accessible to all Americans, from legal scholars, to political 
scientists, to school children. The impact of these cuts, and others, 
is illustrated by the examples below:
    Brittle books and newspapers.--As a result of the fiscal year 1996 
budget cut, NEH was unable to fund projects that would have preserved 
20,000 brittle books. In addition, 230,000 disintegrating pages of 
newspapers will not be saved due to the funding reduction. Without NEH 
assistance, libraries will be forced to revert to a more parochial 
preservation role, caring only for those collections of direct interest 
to the immediate institutional community.
    Papers of leading Americans.--The completion of scholarly editions 
of the writings of U.S. Presidents and other major historical figures 
has been put at risk by the funding levels of the past two years. Among 
the compilations that may not be completed are the papers of George 
Washington, Thomas Jefferson, Dwight Eisenhower, and Thomas Edison. In 
addition, NEH is now funding significantly fewer grants that support 
scholarship, which uncovers new information and expands our knowledge 
base.
    Summer Seminars for Teachers.--Many colleges and universities, 
including my own, host summer seminars for high school and college 
teachers, who are given the opportunity to study with leading scholars 
in their fields. The workshops generate renewed enthusiasm and new 
knowledge among the participants which are then transferred to students 
around the country. In the summer of 1995, this program supported 
seminars and institutes attended by more than 2,600 high school and 
college teachers, who teach approximately 425,000 students a year. The 
fiscal year 1996 budget cuts have meant that 1,400 fewer high school 
and college teachers participated in these workshops.
    Support for Young Scholars.--Among the programs that have been 
eliminated are several devoted to helping young scholars complete the 
Ph.D. and establish their careers. These include the dissertation grant 
program, which provided one year of dissertation support for the most 
promising Ph.D. students in the humanities, enabling them to complete 
their degree during what is the most difficult time for humanities 
Ph.D. candidates to support themselves financially.
    Because of the positive contribution that NEH makes to our society, 
we urge the Subcommittee to support the Administration's fiscal year 
1998 budget request of $136 million, which would allow the agency to 
recover some ground lost over the past two years. We note that this 
would still be a 21-percent reduction from the fiscal year 1995 funding 
level.
    NEH has been the single most important source of support for 
humanistic endeavors in the United States for a generation. It has 
become an important national resource. It has allowed Americans, to 
borrow the words of Pericles, the ancient Athenian leader, to ``value 
culture without extravagance and knowledge without self-indulgence.'' 
We believe it is in the national interest to continue funding NEH. We 
very much appreciate the Subcommittee's longstanding, bipartisan, 
support for NEH, and we urge the Subcommittee to support the $136 
million budget request.
                                 ______
                                 

    Prepared Statement of Robert H. Knight, on Behalf of the Family 
                            Research Council

    In 1995, Congress voted to phase out funding for the National 
Endowment for the Arts. Many congressmen voted for funding in fiscal 
1996 and 1997 with the express stipulation that the subsidies would 
end; no money was to be appropriated for 1998. From 1995 through 1997, 
the agency was supposed to be developing alternative funding sources.
     Now, some in Congress are seeking to break the agreement by 
appropriating more funds for the agency. They appear to be bending to 
pressure from arts groups whose members receive federal subsidies. If 
Congress caves on the agreement, it would constitute a betrayal of 
those congressmen who agreed to the compromise. And worse, it would be 
a betrayal of American taxpayers.
    Begun in 1965 as part of Lyndon Johnson's Great Society government 
expansion, the NEA was supposed to raise the level of artistic 
excellence and promote a wide variety of art. The agency's budget 
reached a high of $176 million in 1992 and was slated for $99 million 
in fiscal 1997. Although the NEA has funded many worthwhile programs 
around the nation, it has also managed to create an unbroken record of 
special favors and embarrassments. Year after year, the NEA has doled 
out money to ``shock artists'' who produce obscene, anti-family and 
anti-religious works.
    At funding time, NEA defenders pledge to reform the agency, but 
this never happens. In 1989, Congress passed a law requiring the NEA to 
withhold funding from pornographic projects, but a federal court later 
struck it down. That opened the way for the NEA to continue disbursing 
questionable grants.
    Some NEA defenders say that the unpalatable grants count for only a 
small share of NEA-funded projects. This may be true, as far as the 
most objectionable, but it is also misleading. Government subsidies, 
even with the best intentions, are dangerous because they skew the 
market toward whatever the government grant-makers prefer. NEA grants 
place the stamp of official U.S. Government approval on funded art. 
This gives the endowment enormous power to dictate what is regarded as 
art--and what is not. This power was never envisioned by the nation's 
founders when they limited the federal government to a few very 
specific duties in the Constitution.
    As has been noted by NEA Chairman Jane Alexander, ``When we give 
the grant, everybody has to fall in line with what our requirements 
are: That's a given.'' If a private donor is going to match NEA funds, 
``they are going to match what our panel has approved,'' she said. 
``We're the driving engine.'' \1\ Alexander also has noted, ``for every 
dollar we award we leverage 11 to 20 from other public and private 
sources in a community.'' \2\ Private giving for art has reached more 
than $9 billion annually.\3\ Given the tremendous availability of 
private funding, why should taxpayers be forced to contribute to a 
bureaucracy devoted to its own tastes?
    How has the NEA used this enormous power? It has consistently: 
Paved the way for child pornographers' lawyers to claim in court that 
their works fall under the ``artistic'' merit defense, based on 
comparisons to NEA-funded works; rejected grants from artists working 
in traditional themes or mediums; discriminated against art with 
religious themes--unless the art demeans religion;cultivated a singular 
artistic style--avant-garde--in violation of the NEA charter which 
forbids the NEA to ``impose a single aesthetic standard or attempt to 
direct artistic content;'' \4\ continued to fund pornographic artworks, 
films and venues that stage obscene ``performance art''; discriminated 
against some geographic areas in favor of others such as New York, 
California and Minnesota; and promoted the splintering of America into 
identity groups.
    Los Angeles Times arts critic Jan Breslauer charges the NEA with 
abusing the concept of multiculturalism by funding works based on the 
identity of the artist, not on the merit of the project. In The 
Washington Post, Breslauer writes: ``The problem with the NEA isn't the 
funding of a few controversial artists. It is systemic. For while the 
NEA's right-wing foes have been railing against the chimera of 
obscenity, the endowment (along with, since the late 1980s, many 
private arts funders) has quietly pursued policies rooted in identity 
politics--a kind of separatism that emphasizes racial, sexual and 
cultural differences above all else. The art world's version of 
affirmative action, these policies * * * have had a profoundly 
corrosive effect on the American arts--pigeonholing artists and 
pressuring them to produce work that satisfies a politically correct 
agenda rather than their best creative instincts.'' \5\
    In addition to aiding the pigeonholing of art, the NEA's stamp of 
approval has impeded the prosecution of people whose business is not 
art at all. In testimony before the House Interior Appropriations 
Subcommittee on March 5, Patrick Trueman, former Chief of the Child 
Exploitation and Obscenity Section of the U.S. Justice Department, 
said, ``Much of what we prosecuted * * * involved material of the same 
nature as that funded through the years by the NEA * * * I submit that 
the NEA poses a direct threat to the prosecution, on both the federal 
and state levels, of obscenity and child pornography crimes.'' \6\
    Trueman noted that the NEA's stamp of approval is often enough to 
provide a defense of pornography based on ``artistic merit.'' He said, 
``It would be difficult if not impossible to keep from a jury a defense 
argument that the material charged is not child pornography at all but 
rather `art' because the NEA has provided funding for its production or 
distribution. The threat that the NEA poses in the prosecution of 
obscenity and child porn cases is not merely hypothetical. The 
difficulties I have outlined in this regard were faced by the U.S. 
Department of Justice during my years in the criminal division with 
respect to the funding by the NEA of an exhibit by the late Robert 
Mapplethorpe.'' \7\
    Over the years, the NEA has funded numerous forms of sexual 
debauchery in sculptures, paintings, films, theater, ``performance 
art,'' and other media. The NEA also helped fund a 1994 film, One 
Nation Under God, that grossly misrepresents Exodus International and 
other ministries that help people overcome homosexuality. Other NEA-
funded projects have directly attacked Roman Catholicism, evangelical 
Protestants, and depicted Jesus Christ as a drug addict and a sex 
object.\8\
    Here are some recent works funded by the NEA:
    Inside the visible.--A museum collection of feminist visual art and 
sculpture, it includes a video depiction of a naked woman on a mattress 
in various revealing poses and sculptures containing dozens of penises, 
some of them wrapped around a hat. The NEA awarded $20,000 to the 
Institute of Contemporary Art in Boston to support the DocentTeens 
program starting in January 1996, which included giving more than 20 
tours of ``Inside the Visible.''
    It's elementary.--This 78-minute film shows teachers and homosexual 
activists acquainting schoolchildren with homosexuality. It includes a 
scene in which a fifth-grader explains how the Nazis used pink 
triangles to distinguish homosexuals from other prisoners. A classmate 
then explains, ``Some Christians believe that if you're gay, you'll go 
to hell, so they want to torture them and stuff like that.'' The 
remark, which implies that Christians are the same as Nazis, goes 
unchallenged. ``It's Elementary'' was supported partly by the Portland 
Art Museum's Northwest Film Center, which received a $13,000 NEA grant 
in 1996.
    Women Make Movies, Inc.--This group, which has received a total of 
$112,700 in NEA grants from 1994 to 1997,\9\ has produced nearly 100 
videos with graphic sexual content, such as Watermelon Woman, which 
includes an explicit lesbian sex scene,' Unbound, in which ``sixteen 
women * * * free themselves from societal definitions, stereotypes--and 
the prison of the bra * * * breaks through the constraints of 
traditional move making and the censorship of women's bodies.'' \11\ 
The group's catalog also features Age 12: Love with a Little L, by 
Jennifer Montgomery, which is described as a ``vivid reconstruction of 
lesbian identity * * * a riveting amalgam of forbidden desire * * * . A 
Village Voice reviewer calls Age 12 ``playful, aggressive and 
unashamedly erotic.'' \12\ The catalog also includes films dealing with 
incest, sado-masochistic sex, oral sex and highly political topics with 
titles such as Keep Your Laws Off My Body and Daughters of Dykes.\13\
    By contrast, the Shakespeare Festival/LA has thrived without ever 
having received any NEA grants. Founded in 1985 by out-of-work actor 
Ben Donenberg, the theater festival staged Twelfth Night in a downtown 
square during its first year. The success of that production, which 
included an audience of homeless men and women, spawned the festival's 
``Food for Thought'' admission policy, in which canned food for the 
homeless is accepted for payment of tickets. In this way, some $1 
million in food has been donated to the Salvation Army. Donenberg also 
created a youth program to bring Shakespeare into the public schools, 
particularly in minority areas, and widened his following by staging 
productions in different locales. The festival attracts grants from 
major corporations and hundreds of individuals. ``There's always a way 
to raise money,'' he told a reporter. ``If the leadership is there, you 
can get it.'' \14\
                               conclusion
    In a time of high taxes and swollen government budgets, when many 
families are hard-pressed to live on one (or even two) incomes, it is 
indefensible to use tax dollars to fund government-dictated art. Why 
should a young family struggling to make ends meet be forced to Find 
Watermelon Woman when, for them, going to a decent movie is a rare 
treat? Congress should abide by the agreement reached in 1994 to allow 
the NEA to pass into history and allow the marketplace to continue to 
support the arts, free from government intrusion.
    Robert H. Knight is Director of Cultural Studies at the Family 
Research Council, a Washington-based research and education 
organization. Mr. Knight, a former Los Angeles Times news editor and 
writer, wrote and directed a video documentary on Alfred C. Kinsey 
titled The Children of Table 34.
                                endnotes
    1. Quoted in Jan Breslauer, ``The NEA's Real Offense: Agency 
Pigeonholes Artists by Ethnicity,'' The Washington Post, March 16, 
1997, p. G-1 at 8.
    2. Letter from Jane Alexander to Rep. Sherwood Boehlert (R-NY), 
June, 1994.
    3. Giving USA 1994: The Annual Report on Philanthropy for 1993, 
AAFrc Trust for Philanthropy.
    4. National Endowment for the Arts, Application Guidelines fiscal 
year 1990, p. 1.
    5. Breslauer, op. cit., p. 1.
    6. Testimony of Patrick A. Trueman, Director of Governmental 
Affairs, American Family Association, before the Interior 
Appropriations Subcommittee on March 5, 1997.
    7. Ibid.
    8. For a list, see Robert H. Knight, ``The National Endowment: It's 
Time to Free the Arts,'' Insight IF95AICU, Family Research Council, 
June, 1995.
    9. NEA grants summarized in letter from Rep. Pete Hoekstra to NEA 
Chairman Jane Alexander on February 13, 1997.
    10. Women Make Movies 1997 25th Anniversary Film & Video Catalogue.
    11. Ibid, p. 22.
    12. Ibid, p. 25.
    13. Ibid, p. 30.
    14. Laurence Jarvik, ``Why Does a Los Angeles Theater Company 
Produce Shakespeare for the Homeless?'' Culture Watch, Capital Research 
Center, Vol. II, No. 3, March 1997.
                                 ______
                                 

Prepared Statement of Dr. Thomas E. Linehan, President, Ringling School 
of Art and Design, on Behalf of the Association of Independent Colleges 
                           of Art and Design

    Mr. Chairman and Members of the Subcommittee, I submit this 
testimony on behalf of the Association of Independent Colleges of Art 
and Design (AICAD) and recommend funding the National Endowment for the 
Arts (NEA) at $136 million for fiscal year 1998. AICAD represents the 
free-standing, degree-granting, accredited colleges of art and design 
in this country. Our 32 member schools enroll 50,000 students from all 
50 states, employ 8,000 artists and designers, and have combined 
operating budgets of more than $475 million.
    While most of our members have received grants from the NEA, all of 
our members believe in the importance of the NEA and its significant 
federal role. The endowment performs the important role of convener and 
creates the opportunity for national committees to reach a consensus 
relating to arts initiatives.
    Many of these initiatives address the opportunities and threats of 
our times. For example, American science and technology has captured 
the world market advantage in computer graphics, animation and 
communications. Each of our member schools are providing instruction to 
artists, designers, and filmmakers in computer imaging. A small federal 
initiative through the National Endowment for the Arts can turn 
America's technology advantage into a design and communications 
advantage as well. The technology advantage was created through the 
support of the National Science Foundation.
    The design advantage in the world marketplace can be secured 
through the support of the National Endowment for the Arts. The media 
arts and the design arts have a severe shortage of design talent that 
can work with advanced imaging technology. We have given our engineers 
and scientists the computing power tools of the next century. Let's now 
develop a talented pool of performing artists, media artists and 
designers who can utilize these same tools.
    Formal art teaching in America began out of a commercial need for 
artists to work in the textile mills of New England. The United States 
had a serious balance of payments problem in its trade with England and 
France. To make the local textiles more attractive to the American 
markets, we called upon American artists and designers to develop 
uniquely American designs--ones which would keep the textile dollars at 
home. It worked.
    It is now time to call upon American artists and designers again. 
Through the NEA's various programs in the performing and visual arts, a 
national consensus can be reached that successfully turns the nation's 
technology advantage into an artistic advantage in the world market.
    America's computer animators, worldwide Web designers, special 
effects artists, computer composers and performers can secure first 
place for the nation in the entertainment and communications 
marketplace of the next decade. The National Endowment can convene, 
critique and generate consensus regarding such urgent and pressing 
needs. This is a proper federal role.
    For a second example of a proper federal role, let me suggest the 
following. As the demographics of the United States change and a larger 
percentage of our population ages, their needs will change. It is time 
to call upon America's architects, planners and designers to directly 
respond to this aging population. Both residential and public design 
must be changed to address these demographic changes. Instead of moving 
people from their homes to group residential centers, a new design 
agenda is needed. This national agenda, supported by the NEA, would 
promote a new design that assumed that we all will ``age in place'' 
(our homes). This new design accounts for the changes brought on by 
aging and allows for the residential environment to be either changed 
or reprogrammed.
    The talent, the will, the agency support is here to create a 
revolutionary change in how residences are designed. This new design 
should minimize the impact on the citizens and maximize their 
independence. Such an NEA sponsored design initiative could be 
supported by insurance companies and health maintenance organizations, 
as well as by associations for senior citizens. This national 
initiative supported by a premiere National Endowment, can and would be 
an important federal role.
    Finally, the National Endowment provides programs to help us 
understand the arts of our time. We look to the great nations in 
Europe, Asia and Africa that surround our own country. We know, 
understand and value their unique contribution to human culture. The 
National Endowment for the Arts is the vehicle Americans have, as a 
nation, to add our contribution to the global stage.
    I urge you to provide an allocation of $136 million to the 
Endowment for fiscal year 1998. In our colleges of art and design we 
teach our students that their work is important and that it will impact 
society. Through the endowment, the artists and designers of this 
country, like the textile designers of a younger America, stand eager 
and ready to make their contribution once again.
                                 ______
                                 

Prepared Statement of David O. Webb, Senior Vice President, Policy and 
   Regulatory Affairs, on Behalf of the Gas Research Institute [GRI]

    Gas Research Institute (GRI) appreciates the opportunity to submit 
testimony to the Seante Interior & Related Agencies Subcommittee to 
present GRI's views and recommendations for fiscal year 1998 funding of 
gas-related research and development (R&D) programs within the 
Department of Energy's (DOE) Fossil and Conservation programs. GRI 
supports the overall budget request of $192 million for gas-related R&D 
submitted by the President for these DOE programs since it continues 
critical funding for on-going programs in natural gas.
    GRI is the RD&D management organization for the natural gas 
industry. GRI has over 320 member companies representing producer, 
pipeline, and local distribution companies. Our mission is to discover, 
develop, and deploy technologies and information that measurably 
benefit gas customers and enhance the value of gas energy service. GRI 
jointly plans and cofunds approximately $20 million annually with DOE 
Fossil Energy and Conservation program offices. Therefore, any change 
in policy or reduced levels of federal funding for these DOE programs 
will have an impact on GRI and the gas industry's cooperative research 
program. Specifically in the fiscal year 1998 budget request for DOE, 
$19.4 million is included for joint DOE/GRI projects. GRI and other 
industry participants are contributing $29.5 million of cofunding for 
these projects.
    Research managed and cofunded by GRI is in the public domain 
because we are a not-for-profit 501(c)(3) research organization and IRS 
regulations require public disclosure of the research results. The 
majority of benefits of such research most often accrue to the 
population in general and do not necessarily result in a marketable 
product by any one company.
    Because many companies, manufacturers, government agencies, and 
marketers come together to contribute to the research under a GRI 
program, benefits are quickly dispersed to each contributor and 
society. Each contributor reduces its financial risk; research is not 
duplicated; the cost is reduced for each company; and the gas customers 
quickly receive the benefits if the research is successful. In this 
regard, GRI does not view federal cofunding of this type of research as 
corporate welfare since the benefits are broadly dispersed to the many 
companies and their customers. We view the private/public involvement 
as an added benefit through the prudent use of scarce research dollars 
by both parties. As research funding becomes more scarce, this type of 
joint R&D is even more critical.
                       federal energy r&d policy
    Federal Energy R&D Policy sets the future direction for development 
and efficient use of our nation's valuable energy resources. The role 
of the federal government in funding energy R&D is critical as a basis 
for decision-making by industry as it competes in an ever increasingly 
competitive world market. Our technical world is becoming increasingly 
complex and as the cost of R&D grows, no single company or group of 
companies can afford the cost and risk associated with the development 
of many of the new energy technologies. Therefore, in times of 
declining budgets, government funds should be used primarily for 
investments that are expected to yield broad public benefits and, 
therefore, not likely to be undertaken by the industry unless 
government provides all or part of the funds.
    The government must continue to have the primary role and 
responsibility for funding and managing fundamental long-term basic 
research in energy because private companies are market driven and 
cannot capture the economic benefits of much of this research. Society 
receives large and continuing benefits from fundamental research, but 
industry alone cannot fund the level of basic research necessary to 
achieve national goals and objectives.
    On the other hand, both government and industry have a joint 
responsibility to plan, conduct, and fund applied R&D to meet the 
nation's energy goals. Industry should be brought in early to assist in 
the planning, financing, and management of the applied research. The 
partnership of private industry in federally sponsored R&D accomplishes 
several goals:
    If the federal research is aimed at top industry priorities, 
industry will provide cofunding. If industry is not willing to support 
applied energy research, government should question its own role in the 
research.
    Industry will bring rigorous cost/benefit analysis to prioritize 
R&D.
    Once industry buys into the research and participates financially 
and managerially, the commercialization path will be shorter because 
industry will be committed to bringing the product or process to the 
marketplace in order to benefit from the research.
    When the project is ready for commercialization, industry is 
already on board and has a vested interest in ensuring the technology 
reaches the marketplace, thus ensuring success from the government/
industry investment.
    Finally, costly duplication of research is eliminated.
    The DOE fiscal year 1998 gas-related R&D budget request was 
developed with input from the gas industry and with the goal of 
completing important on-going projects in a timely manner. Industry 
support of this budget is evidenced through significant cost-sharing 
from the private sector. The research proposal set out by DOE will 
result in completion and commercialization of technologies which will 
contribute significantly to the nation's goals as we pursue all of our 
energy options. In addition, many of these products which result from 
this R&D are excellent candidates for export to other countries, 
thereby increasing the U.S. position in global competitiveness.
    Congress has recognized and needs to continue to recognize the role 
of government and industry in cofunding applied energy R&D and should 
give priority to those DOE research programs that are jointly funded 
with industry.
                   incentives for industry-funded r&d
    In recognition that industry needs to fund more energy R&D as the 
direct federal funding of this research is reduced, last year Congress 
extended the Research and Experimentation (R&E) Tax Credit for eleven 
months. This tax credit will again be a topic of consideration this 
year since the President's budget proposes to extend the credit for 
another year. However, this tax credit as now structured is a 
disincentive for collaborative research. GRI, along with other not-for-
profit R&D organizations, has been active in seeking ways to eliminate 
the current disincentive and create incentives for collaborative 
research. Providing incentives for collaborative research is a sound 
policy at a time when shrinking research dollars both in government and 
private industry are a reality. Collaborative research is more 
efficient in terms of both dollars and time spent. The disincentives to 
the R&E tax credit can be corrected by extending and modifying the R&E 
tax credit to:
    Recognize 100 percent of the funding contributions to 501(c)(3) 
collaborative research organizations as qualifying for the tax credit 
(versus the 75 percent in the current law);
    Redefine ``qualified research'' for collaborative R&D to encompass 
the IRS definition of qualified research for a 501(c)(3) organization;
    Provide a non-incremental 20 percent tax credit for companies' 
contributions to collaborative research conducted by 501(c)(3) 
organizations.
                            recommendations
    GRI encourages the Subcommittee to support the Administration's 
request for gas-related R&D of approximately $192 million of which 
$178.78 million is in this Subcommittee's jurisdiction. Critical goals 
can be reached by continuing funding in the proposed DOE budget for 
programs in natural gas supply, gas turbines, fuel cells, natural gas 
cooling, natural gas vehicles, and industrial efficiency. We at GRI are 
committed to continue to work with both Congress and the Department of 
Energy to accomplish the mutual goals of government and industry.

NATURAL GAS-RELATED RESEARCH WITHIN JURISDICTION OF INTERIOR AND RELATED
                 AGENCIES SUBCOMMITTEE, FISCAL YEAR 1998                
                          [Dollars in millions]                         
------------------------------------------------------------------------
                                                   Fiscal year--        
                                         -------------------------------
                 Program                       1997                     
                                           appropriation   1998 request 
------------------------------------------------------------------------
              Fossil energy                                             
                                                                        
Natural gas supply:                                                     
    Exploration and production..........          $14.12          $14.90
    Delivery and storage................            1.00            0.99
    Utilization.........................            5.84            4.81
    Environmental research/regulatory                                   
     impact analysis....................            2.65            4.62
    Advanced turbine systems............           46.60           31.38
    Fuel cells..........................           50.12           46.29
                                         -------------------------------
      Total fossil......................          120.33          102.98
                                                                        
            Energy efficiency                                           
                                                                        
    Natural gas cooling \1\.............            7.85            8.75
    Lighting end appliance R&D \1\......            0.46            1.45
    Gas turbines........................           28.85           28.85
    Industries of the future \1\........            5.78            5.66
    Transportation--natural gas vehicles                                
     \1\................................           20.34           23.48
    Fuel cells (transportation and                                      
     microcogeneration) \1\.............            5.28            7.61
                                         -------------------------------
      Total energy efficiency...........           68.56           75.80
                                         ===============================
      Total gas related.................          188.89          178.78
------------------------------------------------------------------------
\1\ Indicates gas-related portion taken from overall program.           

                                 ______
                                 

  Prepared Statement of Elias H. Camara, President and CEO, M-C Power 
                                 Corp.

    Mr. Chairman, this hearing occurs at a very significant point in M-
C Power's development of our molten carbonate fuel cell (MCFC) 
powerplant.
    Fuel cells are energy conversion devices that transform the energy 
in a fuel directly into-electricity by means of an electrochemical 
reaction. Because there is no combustion, fuel cells are clean, highly 
efficient, and can be sited close to the electricity demand point, 
significantly reducing the high costs of transmission and distribution. 
Molten carbonate fuel cells operate at 1,200 deg. F., are 55 to 60 
percent efficient, and produce high quality heat for cogeneration. With 
heat recovery, total plant efficiency can approach 85 percent.
    On February 20, 1997, we had the pleasure of hosting the official 
dedication of our current 250 kilowatt (kW) cogeneration powerplant 
demonstration at Naval Air Station (NAS) Miramar in San Diego, 
California. The facility began to produce electricity and steam for NAS 
Miramar several weeks before me dedication and so far has operated for 
over 1,300 hours.
    There are a number of aspects of this demonstration that we think 
are exciting.
    First, a successful demonstration at NAS Miramar will show that we 
are applying the lessons we are learning throughout our development 
process in resolving the basic issues of fuel cell stack design, gas 
flow distribution, component manufacturing processes, and assembly 
techniques. Although most of the balance of plant components are 
commercial technologies that only need to be modified for adaptation to 
our fuel cell application, the fuel cell stack itself is cutting-edge, 
first-of-a-kind technology.
    The 250kW stack at NAS Miramar is 6 feet high, containing 250 
individual fuel cells, each approximately 60 inches long by 41 inches 
wide by 0.3 inches thick. They are layered one on top of the other, 
each with a total of six separate, full-area components. Every 
individual cell must fit, seal and stack within very close tolerances 
in order to maintain proper seals, gas flows and electrical current 
collection during operation. The engineering challenges of design, 
manufacturing techniques, materials handling and assembly procedures 
have been the drivers for M-C Power and the DOE fuel cell program, and 
success at Miramar will go a long way to show that we are meeting those 
challenges.
    The second exciting aspect of our fuel cell development is the team 
we have put together. M-C Power was incorporated in 1987, with the sole 
purpose of developing molten carbonate fuel cells. That is the area of 
our technical expertise, backed by the continuing technical support of 
the Institute of Gas Technology, who performed the original stages of 
the development of our technology.
    To turn fuel cell stacks into powerplants, however, a broader range 
of expertise is needed. In the fuel cell stack are the components that 
produce the electrochemical reaction that generates electricity. The 
powerplant must also include components, known as the balance-of-plant 
(BOP) equipment, mat produce a clean stream of hydrogen-containing fuel 
from natural gas or other fuel, and components that convert the fuel 
cell's direct electrical current into high quality alternating current 
suitable for use in a conventional electricity distribution grid.
    To supplement M-C Power's fuel cell expertise, we have teamed with 
the Bechtel Corporation for their world-wide reputation in engineering 
and powerplant design, and with Stewart & Stevenson Services for their 
world-wide reputation in powerplant fabrication and packaging, service, 
and market knowledge. That combination of skills and assets will 
continue to be of great benefit in moving our technology forward.
    Members of this subcommittee should be proud of your role, as well. 
With increasing pressure to wisely spend fewer tax dollars, your 
consistent support of the DOE fuel cell program that provides our basic 
funding is deeply appreciated. We know there are competing interests 
for prioritization and funding under your jurisdiction.
    We also owe much to the strong financial support to date from the 
Gas Research Institute, the Electric Power Research Institute, the 
Defense Advanced Research Planning Agency and individual utilities who 
have committed scarce R&D funds to supplement the DOE program funded 
through this subcommittee. San Diego Gas & Electric has shown strong 
leadership in their industry as the host utility for our HAS Miramar 
project.
    We benefit, as well, from a number of other sources. During this 
same hearing you will receive testimony from the Alliance to 
Commercialize Carbonate Technology (ACCT), a rapidly growing consortium 
of electric and gas utilities and other private sector entities, 
including international members. ACCT provides us with a constant 
stream of guidance and feedback about technical issues and market 
directions to assure that we will better fit distributed generation 
needs. In turn, we hope that ACCT members learn more about fuel cells 
and how ACCT members might soon use them in their own industries. We 
assume that the knowledge and insight they gain about our fuel cells 
will help give them sufficient confidence in our technology to be among 
our customers.
    We are also pleased to see growing international interest in our 
progress. At the Feb. 20 dedication of our NAS Miramar demonstration, 
we had delegations from both Russia and Poland who recognize our 
leadership and are interested in working with us to develop future 
molten carbonate fuel cell markets and manufacturing in their home 
countries. We also have a series of development discussions underway 
with companies in South America who expect large markets there. The 
demonstration at Miramar is also serving as a good opportunity the 
Navy, Marines and other branches of the military an opportunity to 
begin to familiarize themselves with the attributes and cogeneration 
applications of molten carbonate fuel cells for dependable, efficient 
energy production on military bases.
    Despite all that interest, we need to be clear that this 
demonstration of our first 250kW powerplant at NAS Miramar, while a 
great breakthrough, will still be several significant steps away from a 
powerplant adequately developed for deployment in the power generation 
industry. Our DOE program is directed toward a demonstration that will 
produce 1000kW or 1 megawatt (MVV) of power, effectively four times the 
output of the NAS Miramar unit.
    Although we hope that the powerplant at NAS Miramar will show that 
we have solved the fundamental design, manufacturing and assembly 
techniques necessary for a successful fuel cell stack, we also fully 
expect that it will lead us to improvements that still need to be 
implemented in order to increase performance and reliability up to 
market-acceptable standards while also bringing down size and cost. 
Even when we can call the unit at NAS Miramar a success, it will still 
be only the first time that a fuel cell stack of this size has been 
successfully demonstrated. At the moment, it is a single stack that has 
performed well for several weeks. While we are extremely pleased with 
that, we also know that reproducibility, performance over time, scale-
up, manufacturing cost and packaging to fit the market are the real 
criteria for success. Those are the challenges that lie ahead, in a 
program that will continue to need your strong support.
    The balance-of-plant design and equipment used at Miramar were 
designed to provide a functioning plant that would allow the 
cogeneration of both electricity and heat for use within NAS Miramar. 
Our future 1 MW product will use multiple units of fuel cell stacks 
based on, but improved from, the one at Miramar, and a package design 
that will be optimized for cost, efficiency and size. That future 
product, producing approximately four times as much power as the 
Miramar unit, must do so in approximately half the ground space. 
Developing a multi-stack unit, with its own carefully designed balance-
of-plant is the challenge that still confronts us beyond Miramar.
    Mr. Chairman, M-C Power is here once again to ask for your 
continued support, and the support of this subcommittee. The Department 
of Energy's fiscal year 1998 request for molten carbonate fuel cells 
represents a 10 percent cut from the level the Congress appropriated 
for us this year, and the program funding has historically been divided 
approximately equally between M-C Power and the Energy Research 
Corporation, who is developing a different approach to molten carbonate 
fuel cells. Your strong and steady support in the past has been vital 
to bringing us this far.
    The good news, however, is that we are now making significant steps 
forward. The past years of hard work and funding support are now 
showing more dramatic pay off, and the curve of our progress is 
accelerating. Although we know you will hear that same plea from many 
witnesses, we hope our Miramar project will provide the proof of that 
claim for us. If this subcommittee accepts the DOE request for fiscal 
year 1998 funding in this program, M-C Power's portion of that funding 
would likely be approximately $15.5 million. In order to keep our 
fiscal year 1998 growth and progress on track according to our current 
DOE contract, approximately $20 million for M-C Power would be 
necessary.
    Unfortunately, we are not yet at the point where we can make up 
that difference by turning to the private sector. Although we look 
forward to that day even more than you do, because it will indicate our 
developmental success, we are not yet there.
    As noted earlier, even if completely successful by any definition 
of success applied to it, the Miramar project is still only the first 
successful 250kW stack in a configuration that is not yet the final 1 
MW unit.
    We are also at a time when electric and gas utility markets are in 
a state of rapid change. You will hear more about this in the ACCT 
testimony submitted in this same hearing. While there is strong 
consensus that deregulation may lead to even greater markets for small, 
incremental distributed generation technologies such as molten 
carbonate fuel cells, the current market uncertainties of deregulation 
cause caution among possible energy sector partners or purchasers. 
Current electric utilities, now both generating and distributing 
electricity, may, in future deregulated markets, become primarily 
distributors. Current gas utilities face similar uncertainties about 
their future competitive roles. New energy service companies and 
entrepreneurial ventures may arise to capture opportunity markets.
    Until the impacts of those changes become more clear, however, 
sources of private funds for molten carbonate fuel cell development 
have the luxury of waiting both for more dependable proof of our 
success and more clarity about who will use or deploy technologies such 
as ours. Continued support by this subcommittee will stabilize 
assurance among our potential supporters that the Congress and the 
Department of Energy remain committed to our development until we reach 
that point.
    Again, M-C Power thanks you and this subcommittee for your strong 
support in the past, and we ask for your equally strong support for 
fiscal year 1998.
                                 ______
                                 

  Prepared Statement of Dr. Frank Derbyshire, Director, University of 
              Kentucky, Center for Applied Energy Research

    My testimony is concerned with a request to the subcommittee to 
support an innovative concept that can lead to the commercialization of 
clean coal technologies for advanced power generation, and provide an 
opportunity for the entrance of commercial coal conversion 
technologies. I am asking for federal funds to cost share a one year 
study that will provide the basis for a decision point to proceed with 
the formation of an industrial consortium to design and construct a 
pioneer commercial powerplant in Kentucky. The plant will employ 
advanced technologies for the production of clean, low-cost electrical 
power, with the optional co-production of liquid fuels, chemicals, and 
materials.
                              use of coal
    Coal is our most abundant fossil fuel, the source of low cost 
electrical energy, and is vital to national prosperity and energy 
security. Low-cost power is an important locational factor for 
attracting new manufacturing industries, for economic development, and 
for job creation. Neither natural gas nor oil can compete in terms of 
abundance or low cost.
    To address environmental concerns over the use of coal, the federal 
government, through the Department of Energy, has made an enormous 
investment to demonstrate clean coal technologies. The advanced 
technologies that are now available offer increases in efficiency, 
which translates to still lower cost electricity and greatly reduced 
CO2 emissions. At the same time, sophisticated emission 
control systems minimize environmental impacts. The commercialization 
of advanced technologies would help to stabilize coal production, 
particularly in the eastern coal-producing states, and provide a spur 
to the growth of US industry.
                       advanced power generation
    It is anticipated that any new plant for advanced power generation 
will employ one of several schemes tested by the DOE at the pilot plant 
or demonstration-scale and based upon integrated gasification combined-
cycle (IGCC) technology. IGCC involves coal gasification to generate 
electricity efficiently with effective gas clean up. The system can be 
combined with one of a number of technologies to produce liquid fuels, 
chemicals, or materials. The advantages of IGCC include much greater 
flexibility in fuel selection, improved emissions control and greatly 
improved thermal efficiencies. Extremely low grade coals can be 
utilized with up to 99 percent SO2 capture, and the thermal 
efficiency is up to 35 percent over conventional plants bringing a 25 
percent reduction in CO2 emissions. The ability to convert a 
slip stream of gasified coal to other products affords additional 
flexibility in the product slate and could improve overall process 
economics.
                    impediments to commercialization
    The deregulation of the electric utility industry has brought 
uncertainties, but also new opportunities for the free market 
implementation of new technologies. Numerous reported studies have 
demonstrated that while the utilities recognize the potential 
advantages of advanced power generation technologies, they are 
unwilling to incur costs that adversely affect their competitive 
position. Considerable investment is required to construct a new 
facility and, as with any new technology, there is some technical risk 
associated with a ``first-of-a-kind'' plant. IGCC represents a 
fundamentally new technology, and there is limited experience of 
economics and operation at the commercial scale.
    As a consequence, decisions to build new baseload capacity, and the 
type of technology that will be employed, are being deferred as long as 
possible, and the life of existing plants is being extended. Even then, 
there will still be hesitance to adopt advanced technologies. An 
additional area of uncertainty concerns the price and availability of 
natural gas. Industry is unlikely to act alone to take the next steps, 
and government support is necessary to encourage commercialization and 
to protect the sizeable investments that government and industry have 
already made in the clean coal technology program--estimated to be 
nearly $7.2 billion.
                        pioneer commercial plant
    A proposed solution to this impasse has been developed by members 
of the Kentucky Coal Marketing and Export Council which provides 
oversight of the Commonwealth's coal interests and is a body advisory 
to the Governor of Kentucky, consisting of coal producers, utilities, 
transporters, and the academic and financial communities. The basic 
elements are to bring together an industrial consortium to construct 
and operate a 300-400 MW merchant or pioneer baseload plant for 
advanced power generation, based upon an appropriate gasification 
technology and, optionally, to co-produce liquid fuels, chemicals, and 
materials. The plant would represent the first essential step towards 
the eventual attainment of mature, low-risk commercial processes. 
Through collective investment by private industry, the risks are 
shared, and the proposed plant will deliver baseload power and products 
to the partners in proportion to their ownership interests and needs. 
The co-production of high added-value products could help to offset 
economic uncertainties, attract other industries to join the project, 
and provide a mechanism to commercialize coal conversion technologies. 
A particular example of these products is a recently developed minimum 
emission diesel fuel, or eco-diesel, that can be produced by synthesis 
gas conversion and could be used to meet federal fuel requirements for 
state fleets.
    By siting the plant directly in the coal fields, transportation 
costs and environmental impacts will be reduced. Because advanced clean 
coal technologies can lower the constraints on coal quality, it will 
also allow the utilization of coals that have been ``stranded'' because 
of their sulfur and ash contents. It is also the intention to examine 
the use of coals that have been stranded by outdated mining practices 
(e.g. in waste ponds, abandoned highwalls) and because of limitations 
in mining technology (e.g. in thin seams). Other advantages and 
benefits of the project are that it will: assist economic development 
and the stabilization of coal industry: provide employment; realize 
revenue from taxes; enhance the utilization of indigenous resources and 
reduce dependence on imported energy; and improve US competitiveness in 
technology and engineering. The concept is consistent with the 
Department of Energy's strategy. It provides a model for similar 
ventures that can bring investments in research and development to 
timely industrial implementation, and could eventually lead to the 
widespread construction of new plants for advanced coal-fired power 
generation.
    Private industry will bear the main burden of investment, and will 
look to the state and federal governments for support to help to 
initiate the venture, for use of their expertise and resources to help 
to carry it through, and to provide incentives in the form of 
guarantees or subsidies that will mitigate the risk and encourage 
investors. The period from inception to plant start-up will extend over 
five to eight and will involve several distinct stages, with a decision 
point at the end of each stage.
                              requirements
    Stage I will be a one year feasibility study to establish a 
detailed definition of the concept, to determine the technological and 
economic uncertainties, and to ascertain whether the generation of co-
products is worthwhile. This groundwork is essential to affirm a sound 
basis for the concept and to provide the information necessary to 
attract industrial partners. The study will produce: economic and 
technical analyses of prospective technologies; an evaluation of the 
technologies and benefits of the generation of co-products; cost 
estimates for subsequent phases; the projected cost of new power 
production; an analysis of markets for electric power and other 
products; and defined criteria for plant siting and potential 
locations. The end product will be a prospectus for potential 
industrial partners. Other critical issues should be addressed in 
related research and development programs.
    If a decision is made to proceed, subsequent stages will involve: a 
detailed evaluation of the technology, and economics of the selected 
plant, environmental assessments, and a preliminary engineering design; 
a detailed engineering design and costing; and construction and 
operation. The work will be directed by the Kentucky Coal Export & 
Marketing Council and will involve the efforts of the University of 
Kentucky Center for Applied Energy Research and an experienced DoE 
contractor such as MITRETEK Systems.
    It is requested that the committee appropriate the sum of $400,000 
for the next fiscal year to support the first stage. In recognition of 
the significance of the overall concept to the Commonwealth of 
Kentucky, the state is prepared to commit a further $200,000 towards 
the first stage costs, consisting of $150,000 committed in kind by the 
University of Kentucky Center for Applied Energy Research and the 
balance through the office of the Governor.
    Input to the feasibility study will be provided by information from 
current and on-going research and development programs. The 
continuation of these programs, and their focus on selected topics will 
be important to the success of later stages. We request the 
subcommittee to appropriate funding that will allow a continued funding 
and, where appropriate, expansion of the DOE's research and development 
programs in the following areas: the disposal and utilization of the 
solid by-products from advanced gasifiers; the production of liquid 
fuels and chemicals from coal synthesis gas; the production of added-
value carbon materials from coal; and the development of technologies 
for stranded coal recovery.
                                 ______
                                 
 Letter From Tommy Crawford, Chair, Southeastern Manufactured Housing 
                                Alliance
                                      New York, NY, March 13, 1997.
Hon. Senator Slade Gorton,
Chairman, Senate Interior Appropriations Committee,
U.S. Senate, Washington, DC.
    Dear Senator Gorton: I am writing today to urge your support for 
$7.0 million in funding for Energy Star Partnerships, a program that 
works closely with industry to demonstrate energy efficient equipment 
and activities. The program is funded by the Department of Energy's 
Office of Building Equipment.
    The Southeastern Manufactured Housing Alliance is working on a path 
parallel to the DOE Energy Star Partnerships. Our common goal is on 
reducing energy use and energy costs in manufactured housing. The 
Southeast is synonymous with manufactured homes. Over 47 percent of all 
new manufactured homes are in the Southeast and, in composite, this 
industry adds about $14.1 billion to the regional economy (1996). About 
one out of every seven homes sold in the nation are produced by 
manufacturer members of the Alliance. Three of the top ten residential 
power suppliers are Alliance members and for many utility members over 
70 percent of their new connections are manufactured homes.
    However, manufactured housing is by no means only a regional 
concern. The industry is experiencing explosive growth nationwide. By 
sometime in the next decade, industry observers expect manufactured 
homes to account for about 50 percent of all new housing. The problems 
we address have relevance to all manufactured homes.
    The Manufactured Housing Alliance is collaborating with the 
Department of Energy's Energy Star Partnerships program on a number of 
activities related to increasing the energy efficiency of our nation's 
manufactured housing. This is particularly important, since the 
manufactured housing industry provides the lion's share of shelter for 
low income families; households whose financial security often depends 
on the low energy costs associated with energy efficient construction. 
Some of the activities we are undertaking in partnership with DOE 
include the following: development of energy efficiency lending 
practices for manufactured housing, equipment sizing guidelines to 
improve overall performance, consumer home buying educational 
workshops, and improvements in air distribution systems. There are 
myriad other research areas that merit sponsorship. We will continue to 
identify and pursue these opportunities to improve housing efficiency 
and affordability. The Energy Star Partnerships program is an ideal 
vehicle for leveraging these initiatives and bringing the benefits to 
American home buyers and owners.
    To that end, it is important that the Energy Star Partnerships 
program at DOE be funded at the fiscal year 1998 requested level of 
$7.0 million. As Chairman of the Appropriations Subcommittee, we would 
very much appreciate your support for full program funding. The members 
of the Manufactured Housing Alliance feel very strongly that this 
program be fully funded--and activities relating to manufactured 
housing should increase--improving housing affordability, energy 
efficiency, and quality.
    Thank you for your consideration of this request.
            Sincerely,
                                             Tommy Crawford, Chair.
                                 ______
                                 

    Prepared Statement of the Petroleum Technology Transfer Council

    The Petroleum Technology Transfer Council (PTTC) is pleased to 
comment in support of the Department of Energy fiscal year 1998 funding 
request for oil and natural gas programs in the Office of Fossil 
Energy. The Fossil Energy programs are responsible for many important 
projects that benefit US independent oil and gas producers.
    This testimony is mainly about the PTTC, a unique organization 
formed by industry in 1994. In partnership with state governments, 
industry, and the US Department of Energy, PTTC has created a multi-
disciplinary network for effectively communicating exploration and 
production (E&P) technologies. Our main mission has been to transfer 
practical, cost-efficient technology to producers in the field to 
improve production efficiency and help prevent the premature 
abandonment of the thousands of marginal wells in the 33 producing 
states. In a very short time, PTTC has proven to be a true success 
story for DOE. It has achieved its original goals--and the program is 
able to document its results.
    The nation's small independent operating companies--which are 
responsible for the majority of the production in the lower 48 states--
increasingly are using PTTC to gain access to the research and 
development programs from the Department of Energy, the national labs, 
universities, state geological surveys, petroleum service companies, 
and other sources. Independent producers are participating in PTTC's 
network of resource centers, workshops and Internet websites. As a 
result, accessing and applying E&P technologies is helping increase the 
recovery of US resources--and addressing the problem of the 17,000 
marginal wells abandoned every year in this country.
    PTTC has served as one of the main mechanisms for disseminating 
DOE-sponsored upstream technology and information to the industry. The 
Department of Energy has supported the effort and provided start-up 
funding under a five-year cost-share program. fiscal year 1998 
represents the fourth year of the contract, and PTTC has more than 
exceeded its cost-share requirements.
    The original agreement with DOE called for $3.56 million in federal 
funding for the PTTC for fiscal year 1998. These funds currently come 
from both the oil and natural gas programs of DOE's Office of Fossil 
Energy. Our total cost estimates for the current year, fiscal year 
1997, shown in Table I, have been scaled back by 27 percent from the 
contract amount, respecting the need to reduce federal spending. At the 
same time, PTTC has dramatically increased its non-federal cost-share.
    Continued federal support of PTTC is needed to continue the program 
until it is completely established and can survive on funding from 
industry and state governments. Beyond fiscal year 1999, the PTTC 
expects that it will no longer need federal funds, as efforts are 
continued through self-generated revenues. We believe that this initial 
seed money investment by the DOE will be returned in multiples through 
incremental federal revenues from new projects and additional energy 
production that will be stimulated by effective technology transfer.

                                             TABLE I.--PTTC FUNDING                                             
                                             [Dollars in thousands]                                             
----------------------------------------------------------------------------------------------------------------
                                                                    Fiscal years--                              
              Source of funds/yr.              -------------------------------------------------------   Total  
                                                   1995       1996       1997     1998 \1\   1999 \1\           
----------------------------------------------------------------------------------------------------------------
DOE FE Oi/Gas programs........................     $2,200     $2,200     $2,400     $3,560     $3,460    $15,720
Non-Federal cost-share........................      1,500      2,100      1,800      3,200      3,500     11,700
                                               -----------------------------------------------------------------
      Total...................................      3,700      4,300      4,200      6,760      6,960     25,500
DOE share (percent)...........................         60         50         57         53         50         54
Non-DOE share (percent).......................         40         50         43         47         50        46 
----------------------------------------------------------------------------------------------------------------
\1\ Represents amount in 5-year contract.                                                                       

        industry and government should share in r&d investments
    Public and private research continue to achieve advances in 
petroleum E&P technology that could yield significant national benefits 
in the form of increased domestic production, reduced oil imports, and 
increased public sector revenues. Technology advances resulting from 
ongoing R&D projects promise to amplify these potential benefits. Both 
industry and the public sector stand to gain from the development and 
application of advanced E&P technologies; thus both should share in the 
investments.
    Government also has an essential stewardship role--to ensure that 
our domestic resources are produced efficiently and with respect for 
the environment. To achieve these goals, industry and government must 
recognize the challenge and work together.
    Industry investment in petroleum-related technology and R&D is 
significantly reduced. Thus, DOE needs to continue to invest wisely in 
``technology transfer'' that is focused toward the industry's most 
important needs. This means identifying where advances in geosciences 
and petroleum engineering can achieve the greatest return in deferring 
premature well abandonments and maximizing incremental oil and gas 
production.
   effective technology transfer is essential to realize r&d benefits
    The full economic potential of new and existing technologies will 
not be achieved if producers are not aware of the technology, do not 
understand its economic potential, or do not feel comfortable with 
applying it. Nor will it be achieved if known resources are abandoned 
in the reservoir before the technology can be applied. Effective 
technology transfer is essential to achieve the full benefits of this 
potential and to sustain a viable domestic petroleum industry.
    The government has already invested billions of dollars through the 
years in federally-funded research at national labs, universities, and 
other R&D providers. To truly obtain value from this past investment, 
it is critical to continue technology transfer programs. It is 
important for PTTC to be funded for a few more years until it is fully 
established in all regions, and can become financially self-sufficient. 
By doing so, the government will have an effective mechanism for 
getting federally-funded R&D into the hands of industry.
     pttc effectively transfers products of public and private r&d
    Current technology transfer approaches are not efficient--
particularly as they serve independent producers. Rates of technology 
penetration in the independent producing community are far slower than 
among the majors. This is the primary reason why PTTC was formed by the 
Independent Petroleum Association of America, in conjunction with the 
state and regional producing associations, the Gas Research Institute 
(GRI), the Interstate Oil and Gas Compact Commission (IOGCC) and other 
groups.
    Studies performed by the National Petroleum Council, IOGCC, and DOE 
have identified significant gaps and recommended improvements that must 
be made by government, industry, and the organizations that support the 
industry. PTTC's role is to help bridge these gaps in technology 
transfer to petroleum producers, accelerate and improve the flow of 
technology information to domestic E&P companies, and provide essential 
industry input to the research community to help ensure that DOE and 
other research focuses on the highest priorities of the E&P industry.
            pttc is achieving its technology transfer goals
    The PTTC has helped DOE in targeting upstream R&D efforts on 
practical, short-term projects with immediate applications in the 
field. As a result, the public and private R&D process is accelerated 
by informing users of new and on-going research projects. PTTC 
technology workshops serve as catalysts for bringing new partners into 
R&D consortia and other industry groups. An important benefit is that 
small independent operating companies (those without the staff or 
budget for R&D) have new access to cost-efficient technologies to 
maximize the recovery of oil and natural gas reserves. The future of 
the domestic petroleum industry's R&D efforts must be collaborative--a 
federal, state, industry partnership. PTTC epitomizes this new paradigm 
by serving as a technology clearinghouse.
    Some of the PTTC's most important accomplishments include:
    PTTC has completed 32 problem identification workshops in all ten 
regions. The technical report from the workshops provide valuable input 
to DOE.
    PTTC has conducted more than 30 technology workshops around the 
country, focusing on a variety of topics from 3-D seismic applications 
to produced water disposal.
    PTTC conducted a series of traveling workshops for DOE to 
disseminate results of its Class 1 Reservoir Demonstration Project. 
These workshops were held in six cities, and more are planned.
    PTTC is working jointly with many other organizations to co-sponsor 
relevant training sessions--including the Society of Petroleum 
Engineers, the American Association of Petroleum Geologists, IOGCC, GRI 
and others.
    All 10 PTTC regional resource centers are open, and three satellite 
centers are expected to open in fiscal year 1998, depending on the 
availability of funds. These centers have been established at existing 
technical institutions in petroleum producing regions throughout the 
country. They provide technical assistance, computerized workstations 
with access to information and analytical tools, and other technical 
outreach services for local operators.
    Commercial vendors of technology, software, and other information 
have been enthusiastic about donating their products and services to 
the PTTC resource centers, and helping to train producers in state-of-
the-art technologies to solve their most important technical problems. 
PTTC has currently received approximately $1.8 million worth of 
software donations.
    PTTC has created an electronic information system on the Internet 
allowing petroleum producers and other users to share information. The 
system links the 10 regional home pages with the national Headquarters 
web site. The most popular feature is an interactive Technical Forum 
that is divided into topics for users to post questions, comments or 
notices. Hundreds of producers have attended PTTC workshops on 
accessing oil and gas information on Internet.
    pttc helps doe's oil and gas programs serve a diverse clientele
    PTTC is one key element of the oil and natural gas programs in the 
DOE Of rice of Fossil Energy that makes good sense. It delivers 
demonstrable and measurable benefits to the producing industry and to 
the nation. PTTC provides a new and effective means for disseminating 
the results and products of federally-funded oil and natural gas 
research and analyses. Last year, DOE designed its new outreach program 
based on the PTTC structure and the regional DOE-PTTC teams are working 
closely together to meet industry's technical needs. With other 
important DOE initiatives such as the Natural Gas and Oil Technology 
Partnership, the reservoir class programs, and other actions, the 
audience for the products of DOE programs has expanded.
           doe's oil and gas programs provide vital services
    We want to close on behalf of America's independent petroleum 
producers by asserting that Congress should continue to support an 
active DOE role in petroleum-related R&D and technology transfer. Oil 
and natural gas are strategically and economically critical national 
resources, and the value of DOE programs in these areas extend far 
beyond geoscience and engineering research.
    Through technology transfer efforts such as the PTTC, the results 
of federally-funded research will reach operators in the field, where 
it can be used to preserve our national energy security. We encourage 
Congress to provide the funding that DOE has requested to continue its 
vital oil and natural gas programs. Thank you.
                                 ______
                                 

   Prepared Statement of the Coal Utilization Research Council [CURC]

    This written testimony is submitted by the Coal Utilization 
Research Council (CURC or the Council), a recently-formed organization 
currently consisting of utilities, coal producers, mayor equipment 
suppliers, architect, engineering and construction firms and other 
service providers interested in the cost-effective and environmentally 
superior use of coal. Having only been launched within the past month, 
the membership of CURC is not yet able to comment, in detail, upon the 
proposed Department of Energy (DOE) budget for fiscal year 1998. During 
this Subcommittee's deliberations in the coming months, the Council 
hopes to provide Members with detailed comments about the scope and 
direction of the DOE's proposed fiscal year 1998 fossil energy budget, 
particularly those items related to the coal research and development 
program.
    Many members of the CURC are also members of the Clean Coal 
Technology Coalition. The clean coal program is a model for successful 
government/industry partnering. Industry's successful involvement in 
clean coal has led many companies interested in the continued use of 
coal to now join together in the creation of this new organization so 
that we might collectively focus on the longer term research and 
development needed to insure the continued use of coal.
          the mission of the coal utilization research council
    The members of CURC intend to examine in-depth those coal-related 
research and development programs being conducted at the federal and 
state government levels, as well as within industry. CURC will 
collaborate with government agencies and other industry organizations 
throughout this process. The Council intends to achieve a consensus 
among our members about the direction and level of effort required by 
government and industry to achieve coal-related technology development 
results that will then be applied commercially. The Council will be a 
vocal advocate and a provider of useful information that addresses the 
importance of, as well as the benefits to, our Nation with respect to 
coal-related R&D and technology development. To the extent possible, 
CURC will also encourage the establishment of international cooperation 
and information dissemination that addresses coal-based R&D and the 
promotion of international coal technology exchanges. Importantly, such 
exchanges must be reciprocal: information and ``know how'' cannot, and 
should not, flow in one direction only. We have information to provide 
and share; other nations do, as well. As a consequence of these 
efforts, we will seek, perhaps not in this budget cycle but in 
subsequent examinations of future budget requests, to provide this 
Subcommittee with an industry view of a coherent coal-related R&D 
agenda (a long-term coal R&D ``roadmap'') that will be designed to best 
insure the continued use of coal.
              general comments about doe's coal r&d budget
    Our membership is aware of the very difficult choices confronting 
this Congress as you must choose among programs and priorities. While 
we are in no position yet to recommend significant changes or 
reallocations or any overall increases to the coal R&D program, we do 
wish to take this opportunity to emphasize the importance of continuing 
an aggressive R&D program for coal utilization. And, importantly, the 
members of CURC urge the Subcommittee to resist any attempts to further 
reduce appropriations for coal R&D.
                           specific comments
    First, we would caution against reducing budgets or eliminating 
research and development programs related to fossil energy as some in 
Congress are advocating. Those Members have attacked federal energy 
research and development programs claiming that the programs represent 
corporate welfare and special interest Subsidies.'' That label needs to 
be challenged. Where industry is willing to cost-share with government 
in pursuing coal-based R&D, that partnership is not corporate welfare. 
That label also is not appropriate where the government, on behalf of 
taxpayers, is partnering with industry and has an interest, on behalf 
of the public, in ensuring that our natural resources are used 
efficiently and that the use of those resources results in the least 
negative impact to the environment while also insuring a great benefit 
to the general public through secure, reliable and low-cost energy and 
other coal-based products.
    Second, many in industry, like government, have been required to 
downsize significantly. While industry recognizes the importance of 
research and development, it is nonetheless true that long-term R&D is 
among the first budget categories to feel the knife because limited 
dollars are increasingly directed at technology innovation designed to 
support shorter and shorter product life cycles. In other words, 
research and development dollars are only justified and approved if 
near-term results are shown. Yet, in the face of these budget cuts in 
R&D, we also know, as a nation, that federal support for longer-term 
R&D has been a critical element to our industrial competitiveness. The 
President's Committee of Advisors on Science and Technology recently 
reported to the President (see: letter from John A Young, Co-chair of 
the President's Committee of Advisors on Science and Technology, dated 
December 6, 1996): ``The United States has allowed Federal spending on 
energy R&D to fall more than three-fold in real terms in the last 15 
years, a period in which private funding for energy R&D also was 
falling. Government spending on energy R&D is more than twice as high 
in Japan as in the United States, and about four times as high as a 
fraction of GNP.''
    That same communication to the President recommended: ``* * * an 
expanded effort on clean and more efficient fossil-fuel technologies.''
    For purposes of comparison, in fiscal year 1994, the DOE provided 
over $167 million for coal R&D programs; however, in fiscal year 1997, 
this amount was reduced to $103 million--nearly a 40-percent reduction 
in only 4 years.
    While the reduction to the requested funding level for coal R&D is 
less dramatic this year, it is a continued reduction nonetheless. And, 
in light of the goals and objectives that the DOE has set forth as 
justification for the budget requested for fiscal year 1998, it does 
not appear that this decreased level of funding can achieve the goals 
sought. During the coming months, the CURC intends to examine the 
levels of funding for the various categories of programs included in 
the DOE's coal R&D program against the goals which those funding levels 
are supposed to support. In addition, the Council will seek an industry 
perspective regarding research and development and then will urge upon 
the Congress and the Administration our agreed-upon R&D ``roadmaps'' 
which we believe should be pursued in the support of an overall goal to 
insure the continued utilization of coal.
    Third, in this time of constrained budgets, it may also be 
necessary to prioritize among programs. Our intent is to undertake such 
a task and to provide that information to the Congress, as well. As a 
result, while the CURC is not now suggesting that funding for coal-
related R&D should be raised to the level of several years ago, we may 
call to the attention of the Congress a need to insure that a balance 
in federal expenditures is achieved among the various sources of energy 
and energy conservation/efficiency.\1\
---------------------------------------------------------------------------
    \1\ Despite an overall reduction in funding for DOE R&D programs, 
not all program budgets are being cut. In the fiscal year 1997 budget 
request, the budget for fossil energy programs was scaled back 10 
percent, while the budget for renewable energy and energy efficiency 
was increased by 35 percent (from the fiscal year 1996 level of 
appropriations).
---------------------------------------------------------------------------
                              conclusions
    U.S. coal reserves represent 90 percent of our Nation's combined 
energy reserves; and, coal-fired generation provides 55 percent of U.S. 
electricity. Worldwide, coal accounts for 25 percent of total energy 
consumption and is projected to increase to more than 50 percent over 
the next 20 years. In addition, coal provides significant amounts of 
energy for industrial processes and is an emerging feedstock for 
transportation fuels and chemicals. Coal and coal-related technologies 
add billions of dollars each year to our economy. In addition, coal-
based technologies that permit the use of coal are part of a growing 
U.S. export market. Those growing exports contribute to our country's 
international competitiveness.
    To assure the continued utilization of our abundant reserves, coal 
must be used effectively, economically, and in a manner that is 
environmentally acceptable. Coal will remain a basic energy feedstock 
to power and fuel the U.S. economy and will be used increasingly 
throughout the world as an energy and industrial feedstock, 
particularly as developing countries gain economic strength. New 
technologies derived from research and development are key to the 
continued effective use of coal.
    In an era of increasing competition to provide low cost 
electricity, it is important for coal to remain a significant fuel 
resource of the future. In addition, mounting pressure to produce 
economical energy from coal will be coupled with pressure to minimize 
the environmental impacts resulting from coal use. These demands can be 
met through advancements in existing technologies and the development 
of new technologies.
    Continuing government support is required to ensure that a balance 
of short-and longer-term, high-risk research and development is 
pursued. Certain clean coal technologies for power production also are 
amenable to the production of clean fuels and chemicals. Research and 
development in these technologies should continue to be an important 
part of federal government's coal R&D program.
    The members of the Council appreciate the opportunity to present 
these views and look forward to working with the members of the 
Subcommittee.
                                 ______
                                 

   Prepared Statement of the National Association of Energy Service 
                               Companies

    The National Association of Energy Service Companies (NAESCO) is a 
trade association of energy service companies (ESCOs) and their trade 
allies, including utility and manufacturing companies. NAESCO's current 
membership of over 100 organizations includes firms involved in the 
design, manufacture, financing and installation of energy efficiency 
equipment and services in the private and public sectors, including 
Federal buildings.
    The thousands of energy efficiency retrofits installed by NAESCO 
member companies to date enable energy consumers to save an average of 
25 percent off of their previous building energy costs. NAESCO's energy 
service company (ESCO) members offer capital constrained customers the 
opportunity to upgrade their facilities without any up-front capital 
expenditures. In addition, ESCOs assume the performance and technical 
risk so that repayment for project costs comes only from measured and 
verified energy savings generated by a successful, ongoing project. 
NAESCO appreciates the opportunity to present the following testimony.
    In its fiscal year 1998 budget request, DOE states that ``the major 
fiscal year 1998 emphasis'' for the Federal Energy Management Program 
(FEMP) ``will be on using private sector investments to retrofit 
federal facilities using energy savings performance contracting [ESPC], 
thus stretching federal leveraging to the maximum.'' For the reasons 
stated below, NAESCO fully supports DOE's budget requests for FEMP and 
other programs that are designed: (1) to support the objective of using 
ESPCs for the energy efficient retrofit of federal facilities, and (2) 
to provide equal access by all qualified energy service providers to 
the Federal market for energy efficiency services.
                      the energy services industry
    The U.S. electricity market is moving away from its traditional 
monopoly structure and cost of service regulation and into a market 
characterized by open retail competition. At the same time, energy 
efficiency retrofits, funded and carried out by private sector energy 
service companies (ESCOs) offer the opportunity to upgrade existing 
facilities and manufacturing processes to create a more energy 
efficient and productive U.S. economy.
    ESCOs are entrepreneurial companies, who finance and install energy 
efficiency measures for energy users. The ESCOs' services often include 
the installation of energy efficient lighting, motors, HVAC and other 
energy conservation measures at no up-front cost to a customer such as 
the Federal Government. The owners or occupants of such buildings 
benefit from reduced energy costs, while enjoying an upgraded facility. 
As an added benefit, existing utility generation capacity is freed up 
so that it can be sold to new customers, thus avoiding investments in 
new generating capacity.
    ESCOs produce numerous new jobs, not only within their companies, 
but through the use of contractors and through the countless other 
firms involved, directly and indirectly, in supporting energy 
conservation projects. For example, the ESCO industry has spawned a new 
group of firms that specialize in providing the hardware and software 
used in measuring energy savings.
    Approximately one-third of the money invested in ESCO projects is 
applied to labor costs. Thus, out of the estimated $2 billion of 
installed projects to date, ESCOs have generated approximately $700 
million in direct labor employment. In addition, the energy efficiency 
installed by ESCOs are primarily U.S.-produced, providing an added 
stimulus to the U.S. economy. Energy service companies thus support 
American manufacturing and stimulate job growth while enhancing the 
competitiveness of U.S. industry by reducing the operating costs of the 
nation's buildings, and manufacturing facilities and processes. In 
addition, the more efficient application of energy produces 
environmental benefits through reductions in air emissions from burning 
fossil fuels.
 reducing the costs of operating the federal government through energy 
                    savings performance contracting
    The Federal government is the single largest energy consumer in the 
world. In 1994, the Federal government spent about $3.8 billion for the 
energy it used in the buildings that it owns and leases. These annual 
energy costs can be reduced by as much as $1 billion through 
performance based energy efficiency improvements financed by the 
private sector, for example, through the use of energy savings 
performance contracts (ESPCs). Moreover, these savings and the related 
facility improvements can be achieved at no added cost to the Federal 
budget, or to American taxpayers. In addition to these energy savings, 
the U.S. economy benefits through the creation of new jobs and through 
the increased competitiveness in global markets that results from the 
reduced costs of maintaining public and private sector infrastructures.
    Congress recognized and endorsed these potential budget and energy 
savings in the 1985 Omnibus Budget Reconciliation Act and in the 
bipartisan 1992 Energy Policy Act (EPAct). In recent years, initiatives 
undertaken by the Department of Energy's (DOE) Federal Energy 
Management Program (FEMP), including Energy Savings Performance 
Contracting (ESPC), are leading to the development of procurement 
structures designed to enable Federal agencies to enter partnerships 
with the private sector for the installation of commercially available 
energy efficiency technologies.
    Where these efficiency investments are undertaken by ESCOs through 
energy savings performance contracts (ESPCs), energy consumption and 
cost reductions are measured continuously and reported monthly, thus 
ensuring real and verifiable savings. Under an ESPC, all project costs 
can be financed by the private ESCO who is repaid out of verified 
energy cost savings over the life of a contract, up to 25 years. Also, 
ESPC contracts usually provide for the maintenance of the conservation 
measures by the ESCO at no additional cost to the customer.
    Unfortunately, the Federal government is realizing only a small 
fraction of the energy cost savings available through such private 
energy conservation investments in Federal facilities. DOE initiatives 
like Energy Savings Performance Contracting, the Regional Energy Action 
Teams and the Energy Efficiency Partnership Initiatives offer an 
important first step on the road to capturing the energy cost savings 
readily achievable in a broad range of Federal facilities. DOE and its 
sister Federal agencies must be aggressive in their pursuit of a full 
realization of the dollar savings and energy consumption reduction 
available through the wide-spread use of ESPCs.
    the department of energy budget request for energy conservation
    As Secretary Pena observed during his Senate confimnation hearings, 
the DOE should be the leader in reducing energy consumption throughout 
the Federal sector. Over the past three years, the DOE Office of Energy 
Efficiency Conservation and Renewable Energy has demonstrated 
leadership and initiative in four critical areas: (1) in technical 
guidance and training of Federal energy managers; (2) in the 
formulation of standardized guidelines and procedures for quantifying 
the energy savings resulting from the installation of energy efficiency 
measures; (3) in the finalization of the energy savings performance 
contracting regulations necessary to undertake private investments in 
Federal facilities; and (4) in the development and dissemination of 
materials designed to educate both public and private concerns 
regarding the availability and benefit of energy efficiency measures.
    There now is experience among some Federal energy managers with 
private-sector financing of energy efficiency upgrades of Federal 
facilities through the use of energy savings performance contracting 
(ESPC) procedures. At this time, additional Federal support is required 
in two principal areas: (1) Federal contracting officers must be better 
educated on the opportunities for greater energy productivity within 
available appropriations, through such alternative financing and 
contracting mechanisms as energy service performance contracting; and 
(2) Technical and contracting support is necessary to enable Federal 
agencies to implement energy savings performance contracts (ESPCs). 
Through these efforts, it is hoped that energy savings performance 
contracting (ESPC) will come to be viewed as a standard mechanism for 
the procurement of energy services.
    Through DOE's Federal Energy Management Program (FEMP), training is 
being provided for the over 3,000 Federal energy managers and 
contracting officers. FEMP also is addressing the need for technical 
and contracting support through its regional energy action plan (REAP) 
teams and other related initiatives. In addition, FEMP makes a 
substantial contribution to education and information dissemination 
about the benefits of ESPCs through the creation of educational 
materials and TeleFEMP broadcasts.
    Finally, both FEMP and the Energy Efficiency Partnership 
Initiative, within DOE's office of Building Technology, State and 
Community Programs, are supporting the development of educational 
materials for federal, state and local facility managers. These 
materials offer a highly effective means of: (1) creating awareness of 
the increased productivity available through energy efficiency; and (2) 
enhancing contract officers and facility managers' understanding of how 
public sector energy efficiency projects undertaken in partnership with 
private sector energy service companies (ESCOs) work.
    NAESCO believes that these efforts facilitate DOE's stated goal of 
emphasizing the use of energy savings performance contracts (ESPCs) and 
thus supports the budgetary levels being sought by the DOE for these 
initiatives. Furthermore, these programs are more than self-funding 
since, according to the DOE, the energy costs savings are about $3 for 
every $1 invested. Since 1985, the U.S. Government has saved over $11 
billion as a result of energy efficiency investments in federal 
facilities to date. The DOE has set a target of $15 billion in net 
cumulative energy savings by the year 2015 as a result of these 
investments. By comparison this year, DOE has requested $31 million to 
support its ongoing efforts to facilitate the development of a greater 
number of energy efficiency investments through its technical 
assistance and educational initiatives. NAESCO believes that the budget 
request for DOE's energy efficiency initiatives is relatively deminimus 
when compared to the dollars saved as a result of the widespread 
implementation of ESPCs. NAESCO looks to both DOE and Congress in its 
oversight capacity as helping stimulate Federal compliance with the 
existing laws and regulations mandating energy consumption reduction 
and utilizing third party entities like ESCOs to provide the financing 
and assume the performance risk.
 the need to ensure all qualified energy providers equal access to the 
                             federal market
    During his Senate confirmation hearings, Secretary Designate Pena 
supported the development of a fully competitive marketplace for energy 
efficiency and other energy related services. In its fiscal year 1998 
budget request for FEMP, the DOE has stated its intent to emphasize the 
use of energy savings performance contracts (ESPCs), which require an 
open competitive process, for the procurement of energy efficiency 
services in Federal facilities.
    NAESCO believes that the current reliance on the use of utility 
sole source contracts by Federal agencies for energy efficiency 
services violates Federal requirements for full and open competition 
and is contrary to the national trend toward competition in the utility 
industry. Moreover, it denies the Federal government and U.S. taxpayers 
the benefits of competition in the market for energy services.
through the competitive procurement of energy efficiency services, the 
   federal government can reduce the energy costs borne by american 
                               taxpayers
    Within the United States' economy, residential and commercial 
buildings, including those dedicated to the Federal sector, consume 
one-third of all primary energy and 65 percent of all the electricity 
we produce. By investing in energy efficiency, we can capture more than 
25 percent of this energy for use elsewhere within our economy. If the 
same amount of capacity for energy production were to be provided from 
the construction of new electric powerplants, it would require 80 1,000 
mega-watt plants with their attendant environmental impacts and siting 
concerns. Through energy efficient improvements in existing buildings 
we can free up financial resources for other, more productive purposes 
while at the same time creating new jobs and reducing air emissions.
    As NAESCO pointed out last year, a 1994 macroeconomic study 
demonstrates that by meeting a 2010 energy use reduction target of 30 
percent, the U.S. will reduce annual electricity generation by 27 
percent and decrease the need for the construction of new generating 
facilities by over 50 percent. U.S. electricity customers will enjoy an 
18 percent overall reduction in their electricity bill (a savings of 
$50 billion), while electric sector emissions of carbon dioxide and 
oxides of nitrogen will be reduced by 33 percent and 12 percent, 
respectively. These lower costs for energy, available through private 
energy efficiency investments, will enable U.S. consumers to increase 
their annual consumption of non-electricity goods and service by $45 
billion. (``DSM and the Broader Economy,'' Edward Moscovitch, The 
Electricity Journal, May 1994.)
                               conclusion
    The competitive procurement of energy efficiency investments in 
Federal facilities, which are financed with private sector funds, 
offers a win-win budget initiative for the Congress and the U.S. 
taxpayer. These initiatives will increase energy productivity by 
reducing the energy consumption and therefore the dollar cost of 
operating and maintaining Federal facilities.
    Last year in the conference report on the fiscal year 1997 Interior 
Appropriations Act, the Congress recognized the potential Federal 
budget savings that are achievable through energy efficiency 
improvements in Federal buildings. In addition, it supported the 
greater use of partnerships with private sector energy service 
companies (ESCOs) to capture those savings through the use of energy 
savings performance contracts (ESPCs). NAESCO thanks you, and urges you 
to do so again.
                                 ______
                                 

 Prepared Statements of Joseph N. Darguzas and Ilene Wilder, Sargent & 
                             Lundy, L.L.C.

    Mr. Chairman and Honorable Committee Members: Thank you very much 
for this opportunity to provide testimony concerning an extremely 
critical issue facing the United States and our energy independence. As 
a Registered Professional Engineer in many states and as a citizen of 
the United States, my professional opinion is that continued Federal 
and State participation in fossil energy development and demonstration 
projects is essential.
    Our home State, Illinois, has committed to spend over $2 million in 
support of the LEBS work this year. Our company, Sargent & Lundy, has 
invested millions of dollars in research, development and demonstration 
programs. However, we cannot afford to continue without the backing of 
our Federal government.
    We support the continuation of the fiscal year 1997 line item for 
Advanced Pulverized Coal-Fired Power Plant development of the Low 
Emission Boiler Systems (LEBS) for fiscal year 1998. After due 
consideration last year, you and your colleagues in the House 
determined that this was an appropriate funding amount. Continuing at 
this level will allow the benefits of previous years' funding to be 
realized and allow us to begin the final phase of the LEBS project 
work.
    This project, if your funding allows us to continue, will provide 
benefits to citizens across the United States. For example: Important 
research will continue at the University of Utah. States providing 
solid fuels will benefit by having a cleaner use for their product. In 
the East, people living in States such as New Hampshire, Rhode Island, 
Pennsylvania, West Virginia, etc. benefit from their employment on this 
project.
    Please consider why we believe continued Federal participation in 
our Low Emission Boiler Systems (LEBS) Prairie Energy Project is so 
essential:
  --We have been making steady progress since 1993 to take our LEBS 
        design from concept through bench scale testing, through pilot 
        scale testing. We are now at the point where we are ready to 
        make the next order of magnitude size increase to an 80MW Proof 
        of Concept facility.
  --Consistent with the overall LEBS Combustion 2000 goals of having a 
        nominal 400MW, pulverized coal design ready for commercial 
        deployment in the year 2000, we believe the 80MW size is the 
        next appropriate technological step. (We plan to build this 
        Proof of Concept facility at a mine owned by Ziegler Coal 
        Holding Companies.)
  --Given the current status of the electric industry re-regulations, a 
        project such as this must be economically viable without 
        recourse to utility-rate-based support.
  --While the 80MW size is technically appropriate, economies of scale 
        dictate that this size is not economically viable. Even though 
        our current and potential Prairie Energy Project team members 
        including, DB Riley Research' Sargent & Lundy, AEP Resources, 
        and Ziegler Coal are willing to commit to approximately one-
        half of the project cost, and the State of Illinois 
        approximately one-fourth of the cost; we will simply not be 
        economically viable without the 25 percent support needed from 
        the Federal Government.
  --Perhaps most importantly, Federal help will enable continued 
        development of the technology that will provide economical 
        electric energy in an environmentally acceptable manner. Given 
        the current concerns with respect to global warming and other 
        environmental issues facing the 105th Congress, we believe that 
        having these technologies developed domestically is extremely 
        important to our future economy. Funding significantly lower 
        than the current levels will cause project delays that will 
        result in this window of opportunity being lost to foreign 
        competition. It would also leave U.S. companies at a 
        disadvantage in competing in emerging foreign markets.
    Going forward with this project will offer major benefits to the 
People of the United States, including:
    Environmentally Sound: 70 percent lower NoX emissions 
than conventional systems; over 98 percent SO2 removal; 
reduces carbon emissions by 15 percent; and generates useful byproducts 
to several industries.
    Technology Leadership: Continued use of U.S. technology and 
ingenuity; maintain world leadership role by developing ``state-of-the-
art'' equipment and services; and create strategic competitive 
advantage for U.S. technology.
    Improve Employment Picture: Create near term jobs; and promote 
industrial growth and long term employment.
    Economical Power: Provides low cost electricity to consumers, 
approximately $.03kWh; and economic benefit of spin-off jobs will be 
far reaching.
    Your continued support for the LEBS/Prairie Energy Project and the 
entire fossil energy budget will be greatly appreciated.
                                 ______
                                 

  Prepared Statement of the National Association for State Community 
                       Services Programs [NASCSP]

    NASCSP represents state administrators of the Department of 
Energy's Weatherization Assistance Program (DOE/WAP) and the Community 
Services Block Grant (CSBG).
    This testimony is provided in support of the funding request 
contained in the President's budget, $154 million, for the 
Weatherization Assistance Program. This is a program that from its 
infancy has conserved energy, created jobs, reduced dependency on oil 
imports and improved the health, safety and comfort of low-income 
citizens.
    This committee has acknowledged that Weatherization is a worthwhile 
program that saves energy and improves the health and well-being of 
low-income citizens, and has demonstrated that support by increasing 
the funding levels provided by the House in fiscal years 1996 and 1997. 
We thank the committee for its constant support of this vital program.
    We believe Weatherization has a national impact and senses the 
national interest by creating the technological and programmatic 
foundation for the individual state programs. Weatherization 
contributes to the achievement of national energy and social goals 
through: Cleaner air through reduced CO2 emissions--
Weatherization reduced CO2 emissions by 63,215 metric tons 
in 1996 that would otherwise have been released into the atmosphere; 
reduced consumption of imported fuels through reducing consumption at 
the residential level; reduced demand on other social programs such as 
the Low Income Home Energy Assistance Program (fuel assistance), 
housing and health care; and implementation of innovative energy 
conservation technologies and transfer of this technology into the 
private market.
    The Department of Energy invests significant amounts of money in 
energy conservation research through its laboratories. The 
Weatherization Program has been a testing ground and provided a fertile 
field for the real life demonstration of this research. The National 
Renewable Energy Laboratory (NREL) is developing an audit that will be 
used to determine the best way to conserve energy in mobile homes. Oak 
Ridge National Laboratory (ORNL) Building Technology Center is testing 
the use of storm windows as replacement windows for use in warm climate 
states. The Florida Solar Energy Center and the state of Hawaii are 
working on the development of cost effective solar hot water heaters. 
The front line in the deployment of these technologies will be the 
Weatherization Assistance Program, while the beneficiaries will be 
citizens across the nation. The technology developed as a result of 
field experience and demands from agencies using these retrofit 
measures have national benefits for the entire home-building industry, 
the prefabricated housing industry and the existing housing stock.
    Numerous service providers in the Weatherization Program are 
private contractors. For many of them, the Weatherization Program 
provided their first experience with serious residential energy 
conservation. The advanced audits developed by ORNL, sophisticated 
diagnostics and the other technologies practiced by Weatherization 
providers are also now being used in the utility industry. The unique 
public-private partnership within the Weatherization Program means that 
the deployment of technological advances, proven within the 
Weatherization Program, are expeditiously adopted in the rest of the 
residential building industry.
    Weatherization continues to be a wise investment of taxpayer 
dollars: The Weatherization Program provides a return on investment of 
$2.40 for every dollar appropriated; the Weatherization Program 
produces an average of 33.5 percent energy savings for space heating 
per household; the Weatherization Program identifies and corrects for 
the presence of carbon monoxide and thereby increases health and safety 
in weatherized households; the Weatherization Program reduces 
CO2 released into the atmosphere by 1.12 metric tons per 
household per year; the Weatherization Program leverages an additional 
$3.39 from other federal, state, local and private sources for each 
dollar appropriated; and the Weatherization Program creates or sustains 
75 jobs per million dollars appropriated; 11,550 at a funding level of 
$154 million.
    ORNL recently concluded a report: ``State Level Evaluations of the 
Weatherization Program in 1990-96: A Metaevaluation That Estimates 
National Savings.'' The report finds that the Weatherization Program 
has improved its energy savings over the past seven years, by 83 
percent. The program produced an average of 18.3 percent in savings in 
1989-90, while by 1996 the program was achieving savings of 33.5 
percent. With this greater increase in energy savings there is a 
concomitant reduction in carbon emissions. This report shows that the 
program reduced CO2 emissions by 1.12 metric tons per 
household per year, or 63,215 metric tons in 1996 alone. The greater 
energy savings also increased the benefit/cost ratio of the program by 
49 percent, from 1.61 in 1989-90 to 2.40 in 1996.
    The greater savings are based in large part on the introduction and 
use of more advanced conservation diagnostic tools and audits. Over 26 
States moved to more complex audits since the introduction of the 
National Energy Audit by DOE in the intervening years. The rigorous 
conservation standards developed by the Weatherization Program are also 
being adopted by the private sector.
    The Government Performance and Results Act (GPRA) requires that all 
federal programs have measured outcomes. Weatherization has been 
performance based for years and uses feedback analysis of outcome 
measures to constantly evaluate effectiveness and as a basis for 
change. Weatherization is more successful in maximizing lessons learned 
from outcome measurement than other programs under the purview of this 
subcommittee or those operated by the few other Departments that have 
attempted such program measurements.
    Largely because of skepticism from past administrations, the 
Weatherization Program was subjected to a more rigorous evaluation than 
most government energy or low-income programs. Its performance in 1989-
90 passed all cost benefit tests with flying colors and funding was 
increased. Using the lessons from that evaluation, the Department of 
Energy insisted on common use of the most successful program elements, 
that is, advanced computerized energy audits and addressing air 
distribution systems. The program's performance nearly doubled.
    What makes this program different from other DOE programs that are 
also working on improving measured outcomes is that many of the 
benefits go not only to business, but to private families who are low-
income. More than a third of these households include an elderly 
person. It has been suggested that because of this, the program does 
not belong under the purview of this subcommittee. We think this is an 
erroneous assumption. The program has demonstrated its capacity for 
implementing sophisticated energy conservation technologies, and has 
continued to increase energy savings. Weatherization increases the 
health and safety of its clients; but, first and foremost it is the 
most successful residential energy conservation program in the country.
    Weatherization is a proven federal, state, local and private 
partnership that develops and transfers technology, saves energy, 
creates jobs, puts dollars into local economies, and helps a needy 
segment of our society. For these reasons, NASCSP on behalf of the 
State Weatherization Programs urges you to support the continuation of 
the Weatherization Assistance Program for low-income people by 
approving the Administration's request for $154 million in fiscal year 
1998.
                                 ______
                                 

Prepared Statement of U.S. Senator Jeff Bingaman, New Mexico, on Behalf 
             of the Interstate Oil & Gas Compact Commission

    Mr. Chairman and other subcommittee members: The Interstate Oil & 
Gas Compact Commission (OGCC) submits the following comments in support 
of full funding of the Department of Energy (DOE) budget request for 
oil and gas research within the Office of Fossil Energy.
    The IOGCC is a 36-state organization of governors founded on the 
principles of conservation of petroleum. The Compact was created by the 
governors of oil and gas producing states in 1935, at a time when the 
U.S. petroleum supplies were at a surplus level and production was out 
of control. The waste of this precious resource was rampant and the 
states decided to join together to address the desperately needed 
conservation issues. The Compact grew out of a recognition by a group 
of producing state governors that voluntary agreements among producers 
were not working, and the clear recognition that federal control of the 
industry was looming on the horizon. These governors believed states 
had an obligation to prevent avoidable waste of oil and gas, and 
believed this was a fundamental right of the states to preserve self-
government. The states' initiative has certainly been successful 
regarding conservation. Now we face a different threat as most oil 
fields are abandoned after only 20 to 30 percent of the reservoir is 
recovered, America has turned to the easy access of oil and gas that 
imported sources offer. That has a compound effect in that domestic 
production could be enhanced with little or no environmental impact and 
our independence could be reaffirmed if we reduced our reliance on 
imports
                            summary of issue
    Research has pushed domestic production to vastly increased 
efficiency and recovery levels.
    In 1995 oil imports accounted for $52 billion dollars of the U.S. 
trade deficit.
    Petroleum imports could increase to 65 percent of total consumption 
within the next five years.
    Potential government revenue is being lost every day as production 
declines.
    The U.S. may have to abandon 60-80 percent of discovered oil 
resources by 2015.
    Federal support for applied energy research has fallen 81 percent 
since 1978.
    Oil and gas are America's primary choice for fuel, accounting for 
about two-thirds of our total energy consumption. Unfortunately, to 
satisfy demand we rely on petroleum imports for about 50 percent of 
that two-thirds. It is projected by the DOE that in the next five years 
oil imports will increase to around 65 percent, while oil and gas use 
grows in supplying the United States' energy needs. The domestic 
petroleum industry is a key source of jobs and revenue for IOGCC member 
states
    An even more striking number is that transportation fuel requires 
97 percent of the oil produced. The IOGCC states believe we should not 
want to become more dependent upon foreign oil to ensure food is 
delivered, hospitals get their medicine, people get to work, and the 
military is able to move troops. Clearly the situation as it now stands 
is intolerable.
    The United States cannot afford to increase its dependence on 
foreign supplies of oil and gas. The security of our Nation and the 
health of our economy depend upon a stable supply which can be met by 
increased domestic petroleum production. The federal government must 
begin to pursue a rational energy policy based upon three principles: 
increased domestic production, increased efficiency in the use of 
petroleum, and a common sense approach to regulation that encourages 
conservation without hamstringing production.
    There are several steps the federal government can take to achieve 
these goals. One of the more important steps is a renewed emphasis on 
oil and gas research and development (R&D).
    There are those who would argue that the United States is a mature 
producing region for oil and gas, but we are far from recovering all of 
our available resources. The IOGCC estimates that there are at least 
351 billion barrels of oil left in known reservoirs, 106 billion of 
which are recoverable with current technology. With advances in 
research the U.S. could add another 25 to 50 billion barrels by the 
year 2015. Proved natural gas reserves are 164 trillion cubic feet 
(Tcf). According to the DOE, with current technology, economically 
recoverable natural gas in the lower 48 states is estimated at 1,040 
Tcf. With advanced technology recoverable reserves rise to 1,696 Tcf by 
the year 2015.
    Those numbers do not tell the entire story. In addition to proved 
reserves, there is the possibility that several undiscovered reservoirs 
still exist. The National Oil Program of the DOE estimates there are at 
least 25-60 billion barrels of undiscovered oil. Current technology 
allows recovery of only a limited amount of the oil in a reservoir. 
According to the DOE, unless new technologies are developed and made 
available by the year 2010, the United States would have to abandon 60-
80 percent of known oil resources. The thought of having to abandon 
producible domestic oil is a chilling one. The federal government's 
role in oil and gas research is an important one. The DOE has provided 
the seed money for dozens of projects that bear economic and social 
benefits while strengthening our national security. This is not 
``corporate welfare'', for two reasons: (1) the vast majority of DOE 
oil and gas research is funded through a cost sharing arrangement with 
independent and major producers, and (2) the benefits to the public 
greatly outweigh any benefits to the industry.
    The vast majority of the oil and gas research done by DOE provides 
technology and knowledge that small independent producers would not be 
able to conduct for themselves. These independent producers, the 
equivalent of family farms, are the backbone of the oil and gas 
industry. These projects produce benefits for the economy by increasing 
jobs and wages, providing more efficient consumption of oil and gas, 
enhancing revenue for government, and increasing environmental 
protection.
                            recent successes
    DOE's oil and gas program helps increase production on existing 
wells by funding research into new recovery technologies. Only one-
third of all oil can be produced through conventional vertical 
drilling. Secondary and enhanced recovery methods are absolutely 
necessary if oil production is to be increased. Past R&D by both the 
DOE and industry produced revolutionary technologies. The development 
of 3-D seismic imaging, horizontal drilling, waterflooding, in-situ 
combustion, inert gas flooding and other enhanced recovery operations 
have revolutionized oil production. These developments did not happen 
by accident; they required a tremendous commitment of capital, time and 
knowledge that the DOE helped industry find.
    Advances made in secondary and enhanced recovery operations have 
not only been effective in increasing production but also in increasing 
revenue for producers, the economy, and government. Three-dimensional 
seismic imaging, in conjunction with other information technology and 
enhanced recovery operations, is being used to better characterize 
existing wells. This leads to identification of oil bearing formations 
that producers may have missed. After the formations are located, 
producers are better able to produce the existing well.
    According to Alfred C. Decrane, Chairman and Chief Executive 
Officer of Texaco, horizontal drilling can double, triple, or even 
quadruple the amount of oil recoverable from a vertical well. 
Horizontal drilling allows operators to access reserves trapped in 
naturally fractured reservoirs. It also allows access to reserves in 
thin geographic formations where trapped hydrocarbons are not 
targetable with injection substances. Horizontal recovery has brought 
new life to fields in Utah and North Dakota. In the Pearsall field in 
Texas, horizontal recovery brought post primary recovery in excess of 
the vertically recovered reserves.
    In Wyoming, Dakota Oil Producers, an independent producer, in 
partnership with the DOE's National Oil program, conducted tests with a 
new technology called Huff 'n' Puff. This enhanced recovery technique 
involves injecting surfactant and inert gas into a low pressure 
reservoir to produce a foam that helps prevent the premature channeling 
of injected gas. This technology helps increase the pressure of the 
reservoir which allows more oil to be recovered. Tests are still 
continuing in the area, but early results are encouraging. Wells that 
had ceased production are now producing again.
    In the Unita Basin in Utah, DOE National Oil Program research into 
reactivating mature Class I fields is finding considerable success. In 
the fall 1996 newsletter of the DOE's Reservoir Class Program, Irene 
Chang (BDM-Oklahoma) writes ``The result of the first two completed 
field tests? A win-win-win for taxpayers, producers, and DOE. The 
projected yield from federal taxes and royalties alone from just the 
first project to reach production, Inland Resources/Lomax Exploration 
Company's Waterflood in the Unita Basin, will pay for the entire 29-
project, $120 million Class program.''
    Another DOE program, the Rocky Mountain Oil Field Testing Center in 
Casper, Wyoming, uses a marginal oil well field to conduct tests of new 
technology. They provide a site for technology and environmental 
research, demonstrate new technology to cash strapped independent 
producers and a offer a hands on classroom for a new generation of oil 
and gas students.
    R&D for natural gas provides the similar benefits to the industry 
and the nation that oil research provides. A Gas Research Institute 
(GRI) program was initiated in the early 1980s to develop technology to 
leverage the innate capability of natural gas to approaching the 
problem of lowering nitrogen oxide emissions. The total investment in 
this area has been $35 million; projected savings to customers and 
industry is projected to exceed $40 million by 1999.
    Another GRI R&D program, conducted and cost shared with the New 
York gas company Brooklyn Union, completed 13 separate R&D programs 
that allowed them to safely and economically produce methane from land 
fills. A $500,000 investment yielded nearly $15 million in benefits.
    There are not many things, besides raising taxes, the federal 
government undertakes that might be said to increase revenue. On top of 
that, there are not many programs the federal government administers 
that pay for themselves. Oil and gas R&D is the exception to the 
perception that most government programs are wasteful and eventually 
failures.
    These are only a few examples of the kinds of petroleum R&D 
projects that the federal government helps fund. Most of the projects 
are successful in that they help increase domestic oil and gas 
production. Every new barrel of oil or cubic foot of gas produced in 
the United States replaces foreign imports on a one-to-one ratio, thus 
reducing our trade deficit and enhancing our national security. Every 
new barrel also produces U.S. jobs and revenue for IOGCC member states.
    In 1994 the DOE took steps to ensure that research breakthroughs 
are made available to those who need it most: independent producers. In 
a three-way partnership with the DOE, state governments and industry, 
the Petroleum Technology Transfer Council (PTTC) was established.
    The purpose of this non-profit group is to provide independent 
producers access to information from federally funded R&D projects. 
PTTC acts as a clearinghouse of information for independent producers 
who cannot afford to do such an accelerated level of research 
themselves and may have been unaware of new knowledge and technology.
    Time after time oil and gas R&D performed with the help of the 
federal government proves to be economically and socially successful. 
The contributions to the health of the economy and the wealth of the 
nation are enormous. Petroleum R&D is licensed to other sectors of the 
economy who adapt it for their own uses. Petroleum R&D is a win-win-win 
situation for industry, the public, and federal, state and local 
governments.
                    future needs for oil and gas r&d
    Two recent discoveries in the offshore oil and gas area provide an 
exciting picture of what the domestic oil and gas industry, in 
partnership with the DOE, could achieve through increased funding of 
R&D.
    In the Eugene Island oil field off the coast of Louisiana, drillers 
made a startling discovery: the field seemed to be replenishing itself. 
Preliminary research suggests as oil is recovered more oil migrates up 
from a greater depth to replace it. Research undertaken to understand 
the ``architecture'' of this reservoir could help producers find the 
same type of formations in other places, thereby increasing production 
dramatically. Producers might also be able to create an artificial 
migratory formation in other reservoirs to determine if more oil lies 
under proven reserves. The knowledge and technology that might emerge 
from this research is unfathomable. The threat is that as research 
budgets are slashed, the type of research needed in this situation will 
wither.
    In North Carolina, geologists discovered a new gas reservoir 200 
miles off the coast in the Blake Ridge. This formation, according to 
the U.S. Geological Survey, is made up of enough natural gas to supply 
the world for the next 107 years. There is only one problem: nobody 
knows yet how to produce the gas. It is frozen in crystals along the 
Blake Ridge and presents, right now, severe structural, economic and 
environmental barriers. Long-term research could provide the tools 
necessary to overcome current barriers. As Dr. Charles Paull, a 
University of North Carolina geologist, said, ``It's a pretty 
unanswered question [how to bring the gas out]. On the other hand, 
engineers are pretty good at figuring out ways to do things if you 
define the problem for them.'' The biggest unanswered question: Will 
the funds needed to support the engineers be available?
                            current problems
    Despite the recognized value of long-term petroleum R&D, according 
to a report by the DOE, there is an R&D ``crisis.'' Long term R&D 
expenditures, by both the petroleum industry and the federal 
government, are declining.
    The dollars, in private industry, are being shifted toward mid-term 
and short-term projects. While these projects keep industry competitive 
in today's marketplace, they do little to prepare for competition in 
the future. Stable oil and gas prices, restrictive regulation, and 
increased global competitiveness are several of the factors 
contributing to the decline of long term R&D expenditures in the 
private industry.
    Funding by the federal government of applied energy research, which 
includes fossil energy research, has fallen a staggering 81 percent 
since 1978. In the private sector, energy R&D expenditures since 1982 
have fallen nearly 30 percent from $3.8 billion to $2.9 billion.
    As noted earlier, oil and gas R&D done by the DOE primarily 
benefits the independent producer. Independent producers provide up to 
50 percent of our oil production. These producers are the petroleum 
industries' small businesses and are the backbone of the oil and gas 
industry. With the drop in research dollars allocated for DOE's oil and 
gas R&D program these independent producers face abandoning wells, a 
loss of income and jobs, forcing the nation to lose valuable petroleum 
resources.
                               conclusion
    A renewed emphasis on long term R&D is not a cure-all for all the 
problems faced by the domestic petroleum industry. There are other 
barriers that stand in the way including public indifference, economic, 
environmental, and political barriers. Long term R&D, while not the 
answer, could and would help the United States face these barriers 
armed with new knowledge and new technology.
    C.H. Lyons, an independent operator, said in 1957, ``So long as 
favorable political and economic conditions prevail, the minds of men 
will be directed toward improving methods and techniques for finding 
and producing ever-greater quantities of oil. We can be sure that our 
concept of finding and producing oil in the future will differ 
radically from those of today.''
    Federal government oil and gas R&D, when performed correctly and in 
partnership with industry, will foster the radical concepts needed to 
keep the domestic oil and gas industry alive and producing valuable 
energy resources to fuel America well into the 21st century.
                                 ______
                                 

 Prepared Statement of Dr. Bernard S. Lee, President, Institute of Gas 
                               Technology

    This testimony supports fiscal year 1998 Department of Energy 
expenditures in: The overall natural gas related programs in Fossil 
Energy; the molten carbonate fuel cell program in Fossil Energy; the 
cross-cutting component development portion of the fuel cell programs 
in the Transportation and Buildings sections of the Conservation 
program; the Industries of the Future programs funded through the 
Office of Industrial Technologies in Conservation; and the natural gas 
related research on natural gas vehicles supported through the 
Transportation programs in Conservation.
    Although it may not be the specific jurisdiction of this 
subcommittee, the current issue of utility deregulation should be 
interlaced throughout your consideration of fiscal year 1998 funding 
for Department of Energy programs. Because competitive market pressures 
may cause further near-term cuts in many areas of private sector, 
utility-based R&D, the need for continued--and strengthened--federal 
support is extremely important.
    Utility efforts to lower costs to their customers must, by nature, 
focus on expenditures or savings with near-term impacts. They must also 
have predictable, almost guaranteed results. Those results must also 
deliver benefits directly and dependably to the investor. Those 
requirements are seldom predictable from many areas of R&D.
    Deregulated utility markets, at least initially, will likely be 
driven solely by the price of the electricity or natural gas to be 
delivered, and, to remain competitive, that price will be stripped to 
its barest essentials. The natural gas utility industry is currently in 
the midst of a nation-wide debate over how--if at all--to create an on-
going funding mechanism to support the work of the Gas Research 
Institute, and much of the controversy stems from business units that 
are willing to forego the GRI R&D surcharge in order to gain a 
competitive edge in current pricing. That short-term market focus is 
having similar effect throughout utility industry R&D.
    In deregulated markets, new competitors, seeking to capture the 
most attractive segments of service territories, will do so solely on 
the basis of the cost of current services, without investing in R&D for 
the future. That may then force current utilities to similarly abandon 
long-term R&D.
    We are particularly concerned about the impact of the potential 
near-term reduction of private sector support for the kind of long-term 
R&D programs that are typical of the Department of Energy programs 
funded through this subcommittee. While utilities may still have 
competitive incentives to conduct R&D in areas of maintenance, 
distribution, or automated metering and business systems in order to 
maintain a competitive advantage in the provision of service, they may 
have less near-term incentive to invest in end-use technologies where 
there will be no guarantee that, when successful, the energy used in 
those technologies will be acquired through that utility. Broader 
issues of R&D investment--energy efficiency, environmental performance, 
domestic industry competitiveness in world markets--risk being pushed 
aside by day-to-day competition. Equipment manufacturers may similarly 
be under increased pressure to keep costs--and, therefore, prices--as 
low as possible in order to stay competitive, marketing the best 
products already in hand rather than investing in long-term R&D.
    While those competitive trends may bring attractive near-term 
savings to utility customers, and promises of significant near-term 
profits to the most agile and aggressive marketers, they also bring 
responsibility to this subcommittee and your jurisdiction over the 
important long-term R&D supported through the Department of Energy, 
which is in our national interest. In an ever-tightening budget, you 
obviously face difficult decisions. The constant pressure to be good 
stewards of taxpayers dollars must be balanced against continuing to 
develop energy and environmental technologies that will help our nation 
continue to address the valuable ``public good'' benefits of a stronger 
domestic economy, improved energy efficiency, lower emissions and lower 
reliance on imported fuels that will arise from DOE's on-going research 
programs.
    In recent years, despite steadily tighter budgets, this 
subcommittee has done an admirable job of not only preserving, but 
expanding natural gas related R&D in the DOE budget. IGT appreciates 
that support.
    There are several specific areas to which we hope to draw the 
subcommittee's attention as you consider the distribution of fiscal 
year 1998 DOE funds:
                               fuel cells
    The M-C Power Corporation is one of two contractors developing 
molten carbonate fuel cells through DOE funding and private sector 
cost-sharing. The approach to molten carbonate fuel cells currently 
being advanced by M-C Power was originally developed by IGT, and IGT 
still maintains a role in R&D support. During this hearing you will 
learn directly from M-C Power about the success of their current 
demonstration and the scope of both their technology and market 
development efforts. IGT strongly endorses M-C Power's request for 
funding to continue their work in fiscal year 1998.
    As M-C Power moves toward success, IGT has the opportunity to turn 
our R&D capabilities toward other fuel cell R&D, as well. Through 
funding in both the Transportation and Buildings portions of the DOE 
Conservation budget, DOE will soon be receiving proposals for the 
development of cost-effective components for PEM fuel cells. This DOE 
program is designed eliminate redundant R&D and lower overall PEM 
development costs by establishing technology breakthroughs for specific 
PEM fuel cell components or systems that will then be available and of 
benefit to all developers of PEM powerplants. That is an effective 
method for simultaneously boosting the success and hastening the 
development of all competitive PEM developers, while taking advantage 
of the experience and unique skills that IGT and others may bring to 
this field.
    IGT has recently developed a novel process for manufacturing the 
bipolar separator plates for PEM fuel cells that should significantly 
lower the future market cost of these fuel cells. Last year, DOE 
estimated the cost of mass-produced PEM fuel cell stacks to be $234/
kilowatt. The bipolar plate portion of that cost was $149, with 
humidification and cooling costing $45. IGT is developing a molded 
composite plate which incorporates the bipolar plate, cooling and 
humidification functions, and will cost less that $10/kilowatt. That 
would be a 95 percent reduction in the total current cost of these 
stack components. IGT's bipolar plate technology is simple and 
economical, and can be adapted to any geometric configuration used by 
PEM developers.
    IGT intends to apply for fiscal year 1997 support through this DOE 
competitive program, in the hope of securing $575K for one year of 
funding, supported by private sector cost-sharing, to further develop 
and demonstrate our innovative approach.
    DOE has asked for an increase to $10 million in Transportation and 
$1.7 million in Buildings for PEM component development for fiscal year 
1998, and IGT supports that DOE request.
     industries of the future programs in the office of industrial 
                           technologies (oit)
    The OIT programs in the Industry portion of DOE's Conservation 
budget offer a similar approach of funding technology development 
intended to benefit a broad industry rather than a specific company. 
OIT, in its Industries of the Future program, has chosen seven energy-
intensive industries--steel, aluminum, metal casting, chemicals, 
refining, forest products and glass--for concentrated development. 
Collectively, these industries represent the bulk of our nation's 
industrial energy consumption, and the goal of the OIT program is to 
increase these industries' energy efficiency and productivity and lower 
their emissions, while increasing their competitiveness in world 
markets. While the individual industries may be large in size, scope 
and importance to our domestic economy, they are characterized by a 
broadly diversified base rather than a few industry-dominant companies. 
Benefits derived from the OIT projects will be applicable to a broad 
range of domestic market competitors. The problems to be addressed in 
the OIT programs are identified and prioritized by the affected 
industries, strengthening the probability that the innovations 
developed by the OIT projects will be broadly implemented. All projects 
are competitively chosen, and all come with significant private sector 
cost-sharing, making this program an effective mechanism for leveraging 
both federal and private sector funding.
    IGT is already a participant in several of the OIT programs, 
particularly through technologies affecting our nation's glass 
industry.
    Last year, IGT received a prestigious R&D 100 award for our work, 
co-funded through OIT's Glass Vision Area, on our oxygen-enriched air 
staging (OEAS) technology that uses natural gas for energy efficient 
NOX control in endport and sideport glass melting furnaces. 
Our technology will achieve NOX reductions of 50 percent 
from these furnaces while improving their energy efficiency.
    In another Glass Vision Area project, IGT leads an industry team 
that is currently developing a high luminosity natural gas burner, a 
novel combustion system in which soot is generated and then combusted 
in the burner flame zone, resulting in a highly luminous flame that 
greatly improves heat transfer and thermal efficiency, and lowers 
NOX emissions.
    With support through OIT's Steel Vision Area, we are working with 
industry partners to develop a natural gas fueled oscillating 
combustion technology that can be applied to a number of high-
temperature material processing industries. Bench-through pilot-scale 
testing has already shown 50-90 percent NOX reductions 
through this flame control, coupled with increases by as much as 10 
percent in heat transfer, furnace efficiency and productivity. Further 
gains may occur by combining this technology with our OEAS and high 
luminosity burner breakthroughs.
    We also have an on-going project with funding support from OIT's 
Refining Vision Area, through which we are working to develop an ultra-
low-emission natural gas-fired Forced Internal Recirculation (FIR) 
burner that can be used in both new and retrofit applications in 
process fluid heaters used in the refinery industry and elsewhere, and 
watertubeboilers in a broad range of applications.
    IGT hopes to continue to be involved in the competitive 
solicitations issued through OIT's Industries of the Future programs so 
that we can continue to work together with DOE and industry partners in 
improving our nation's industrial energy efficiency, environmental 
performance and competitiveness in world markets.
    For fiscal year 1998, DOE has asked for an increase of 
approximately $9.4 million for the industry-specific OIT programs, 
moving from an fiscal year 1997 appropriated level of $46.3 million to 
$55.7 million in the fiscal year 1998 request. IGT encourages this 
subcommittee's support for at least the full level of the DOE fiscal 
year 1998 request, and would encourage additional funds above the DOE 
request, particularly in the glass and steel industries and other 
technical areas where natural gas applications can produce significant 
benefits.
                          natural gas vehicles
    Finally, IGT would call the subcommittee's attention to the DOE 
fiscal year 1998 request for R&D related to the more economic and 
expanded use of natural gas fueled vehicles.
    Natural gas fueled engines are now being successfully demonstrated 
in fleets of cars, vans, trucks and buses throughout our nation, 
bringing significantly lowered emissions and a shift from imported 
crude oil to important transportation sectors. That visible success 
consequently may give the impression that we have now achieved maturity 
in our development of natural gas vehicle technology, and that future 
success now should rely strictly on competitive market forces. It 
should be noted, however, that most of the success achieved to date has 
been in limited fleet applications, where fueling station 
infrastructure support exists or when fuel cost savings are substantial 
enough to offset the cost of a customer-owned central refueling 
station. If we are to extend the energy and environmental benefits of 
natural gas vehicles to more fleets, as well as to the general public, 
significant R&D must still be done on compressed and liquefied natural 
gas engine development, on-board storage, fueling stations and fuel 
quality issues. Today's engines do not take full advantage of natural 
gas' beneficial fuel properties. Higher efficiency engines and lower-
cost vehicles can be achieved by supporting DOE's programs in these 
areas. IGT also supports DOE's deployment efforts, which have 
encouraged vehicle and engine manufacturers to stay in the market.
    Significant new benefits can be gained by expanding DOE's program 
to include large inland waterway and marine engines operating on 
liquefied natural gas (LNG). One engine on a tow boat moving barges on 
our inland waterways currently consumes as much diesel fuel annually as 
100 heavy-duty trucks. Many tow boats have up to three engines. 
Conversion of these vessels to LNG could provide dramatic improvements 
in environmental benefits, lower shipping costs and reduced national 
reliance on imported oil.
    IGT has begun to work with a consortium of equipment manufacturers, 
LNG suppliers and tow boat operators to develop the technology, 
adapting current DOE advances for rail applications, for converting tow 
boats and other marine vessels to LNG. IGT urges this subcommittee's 
support for expanded fiscal year 1998 funding in this area.
                                 ______
                                 

      Prepared Statement of the Electric Transportation Coalition

                              introduction
     This testimony is presented on behalf of the Electric 
Transportation Coalition (``the Coalition''), a national, non-profit 
organization of electric utilities, automobile manufacturers, state and 
local governments and other entities that have joined together to 
advocate greater use of electricity as a transportation fuel. (A 
membership list is attached.) A principal activity of the Coalition is 
to encourage the adoption of incentive-based policies and programs to 
support the development of a widespread and sustainable market for 
electric modes of transportation.
    The members of the Coalition recognize the significant budgetary 
constraints faced by the federal government. We also recognize that the 
Subcommittee must ensure limited dollars are prudently allocated. The 
Coalition believes that electric vehicle-related programs of the 
Department of Energy (``DOE'' or ``the Department'') represent such 
wise expenditures in that such electric vehicle (``EV'') programs 
provide valuable support for the introduction of this new 
transportation technology, thereby furthering the national policy 
objective of increasing the use of alternative fuels in the 
transportation sector.
    The role of the federal government has been, first, to provide 
research and development support to address technological issues, 
through programs including the United States Advanced Battery 
Consortium and the hybrid propulsion systems program; and second, to 
assist industry in the testing and evaluation of the latest electric 
vehicle technologies through the Vehicle Field Test and Evaluation 
Program (previously called the Site Operators Program). A third major 
emphasis of the federal government should be to acquire electric 
vehicles for federal fleets.
    The on-going DOE EV-related programs are providing critical support 
in a number of areas that are key to the success of this new, efficient 
and clean transportation technology. These DOE programs complement, and 
augment, other work that is being undertaken by industry separately or 
in partnership with other federal agencies. If fiscal year 1998 
appropriations for these DOE programs are significantly reduced or 
eliminated, the requirements for funding would fall to other parties 
who may not be able to increase their investments even further in order 
to move this technology toward the marketplace.
         the united states advanced battery consortium (usabc)
     The Coalition urges support for the funding level of $15.8 million 
requested by the Administration for the USABC program. (In fiscal year 
1997, the Administration requested $15.32 million and the USABC was 
ultimately funded at that amount.)
    The USABC is a battery research and development program, critical 
to the advancement of EVs. Full-size battery packs and their 
components, such as cells and modules, are being developed through 
research contracts and then tested by the developers, U.S. automobile 
companies, and national laboratories. The battery packs also have been 
installed in prototype EVs being operated at electric utilities and 
testing facilities of U.S. automobile companies. In April 1996, USABC 
participants (comprised of U.S. automobile manufacturers, battery 
developers, the U.S. Department of Energy and several national 
laboratories) completed Phase I of their efforts. The auto makers that 
participate in USABC include Chrysler, Ford and General Motors (GM). 
The national laboratories participating include Lawrence Berkeley, 
Argonne, Sandia, and Idaho National Engineering Laboratory. Phase I 
comprised four elements: begin research efforts (i.e., establish 
research goals and criteria as well as award contracts); establish a 
U.S. advanced battery industry; develop an advanced battery to meet 
mid-term criteria (potential to double the range and performance of EVs 
compared to battery technologies available today) with pilot plant 
production capability; and, demonstrate design feasibility of advanced 
batteries meeting long-term goals (i.e., make EV range and performance 
comparable to that of today's gasoline-powered vehicles).
    These activities were not only successful, but cost effective. All 
the Phase I accomplishments were reached at less than projected cost. 
Phase I activities were budgeted to total $262 million (from industry 
and government); only $200 million was spent.
    Phase II will build upon the successes of Phase I and move forward 
toward the next levels of battery development. Phase II consists of 
three elements which the industry participants expect to complete by 
the end of 1999: conduct more extensive safety, durability, and life 
testing of mid-term batteries to obtain automotive validation (i.e., 
ensure the batteries meet requirements determined by industry as 
necessary for normal automotive applications); continue research 
efforts to reduce costs associated with mid-term batteries; and, 
develop long-term battery technologies through the pilot-line 
production stages.
    It is important to note that without the limited federal assistance 
already invested, the advancements in battery technology accomplished 
to date through the USABC probably would not have been achieved. 
Individually, companies cannot, or are unwilling to, make the 
significant investment required to conduct advanced battery research.
    The majority of fiscal year 1998 funding will be directed toward 
long-term, lithium-based battery research. In later years, the USABC 
anticipates reduced expenditures as the program and projects near 
completion in 1999.
     funding for the hybrid propulsion systems development program
     The Coalition requests support for the Administration's funding 
request of $67.7 million for the Hybrid Propulsion Systems Development 
Program. This program allows industry and government to work together 
to develop a consumer attractive, ultra-low emission vehicle with high 
fuel economy. As of February 1996, three major contracts had been 
awarded to teams of developers, featuring large and small businesses 
and domestic automobile manufacturers, for the development and 
demonstration of hybrid electric vehicles (HEVs). GM and Ford have been 
working under contract on HEVs since 1993. Chrysler's efforts began in 
1996. The Phase I goal of this five-year program is a 50 miles per 
gallon (mpg) propulsion system. The Phase II goal, scheduled to be 
reached by 2004, is an 80 mpg system.
 funding for the vehicle field test and evaluation program and federal 
                      fleet conversion activities
    The Coalition urges the Subcommittee to fund the Vehicle Field 
Test/Evaluation program at the level recommended by the President, $3.7 
million. The program, which was initiated in fiscal year 1997 as a 
follow-on to the Department's Site Operator Users Task Force electric 
vehicle test and evaluation program, provides critical federal support 
to industry efforts to test, evaluate and undertake fleet case studies 
of electric vehicles manufactured by original equipment manufacturers. 
Two test teams, known as ``Quality Vehicle Test Sites (QVTS)'' have 
been selected under the program to establish a uniform set of 
procedures to be used in undertaking baseline performance, reliability 
and fleet testing of EVs and for the conduct of such testing on EVs as 
they become available.
    This year, in addition to the important effort underway with 
industry, the Department plans to acquire, test and evaluate new 
electric vehicles within the U.S. federal fleet. DOE intends to focus 
federal acquisitions of electric vehicles on those equipped with 
advanced batteries that have been developed through the United States 
Advanced Battery Consortium. This important effort can help to assure 
that the federal government meets its obligations, under the Energy 
Policy Act of 1992 (Public Law 102-486), to transition to the use of 
alternative fuel vehicles.
    Finally, the Energy Policy Act of 1992 (``EPAct'') requires the 
federal government, beginning in fiscal year 1996, to convert the 
federal fleet to alternative fuel vehicles. Fifty percent of new 
vehicle acquisitions for the federal fleet (except for limited uses 
like military applications or emergency uses) must be AFVs in fiscal 
year 1998; next year (fiscal year 1999) that percentage rises to 75 
percent. On December 13, 1996, President Clinton issued an Executive 
Order (E.O. 13031) directing federal agencies, in compliance with 
federal law, to convert agency fleets to AFVs and to provide reports to 
the Department of Energy, General Services Administration and the OMB 
certifying that such acquisitions have been made by purchase, lease or 
otherwise. Federal agencies are required to use their own funds to 
acquire such vehicles.
    Importantly, the President's executive order also recognized the 
state of technology development of EVs and determined, and directed, 
that if funding is available, the Department of Energy shall provide 
financial assistance of a limited amount (no more than $10,000 per 
vehicle) to agencies that choose to acquire EVs to fulfill some or all 
of their vehicle acquisition requirements. A portion of the funds 
requested would be used to assist federal agencies desiring to test and 
evaluate EVs in their fleets.
    This requested funding for federal agency participation in 
converting portions of the federal fleet to EVs will complement the 
efforts of the Electric Transportation Coalition in its efforts to 
target major metropolitan areas for the early introduction of electric 
vehicles.
    The President's executive order is directed toward metropolitan 
areas with populations of 250,000 or more. Last year, the Coalition, in 
cooperation with other national organizations and the Departments of 
Energy and Transportation, conducted a series of workshops in ten major 
metropolitan areas across the United States. The program, known as the 
``EV Market Launch Framework,'' was supported by the U.S. electric 
utility and automotive industries and is designed to ``ready'' the 
market for the introduction of EVs. Workshops were conducted in 
southern California; Sacramento; Phoenix/Tucson; Atlanta; Broward 
County, Florida; Detroit; Richmond; Washington, D.C./northern Virginia; 
New York City and Boston. These areas are believed to be the initial 
sites for EV introduction. Importantly, many federal agencies (and 
their fleets) are also located in these areas. The private sector, 
through the leadership of the electric utility industry, is making 
preparations to acquire EVs when they are made available; it is hoped 
that the federal government--in these same or similar areas--will do 
likewise. The funds requested by DOE will greatly assist federal agency 
decisions to include EVs in their plans to convert fleets.
    The modest amount of funding that is being requested will enable 
DOE and industry participants to continue an important cost-share 
program through which electric vehicles and associated infrastructure 
and services to support such vehicles will be evaluated and tested. 
This focused test and evaluation of new technology is a foundation upon 
which a widespread, sustainable market for electric vehicles can be 
built in the United States
    other department of energy programs of interest to the electric 
                        transportation coalition
    In addition to the programs outlined above, the Coalition also 
supports funding to a number of other alternative fuel-related programs 
administered by the Department of Energy.
    The Coalition membership recognizes that electrically-propelled 
vehicles can be ``fueled'' through a variety of different sources. 
Continuing research and development efforts that will lead to a family 
of electric vehicles comprising those powered by batteries exclusively, 
those powered by batteries and an auxiliary power unit, and those 
powered by fuel cells, are critical to assuring that the U.S. leads the 
world in offering the highest-performing, cleanest and most consumer-
attractive transportation options for the 21st century.
    Further, to assure that the marketplace is prepared and receptive 
to new forms of transportation like EVs, the Coalition strongly 
encourages full funding, at the levels requested by the Administration, 
of DOE's programs designed to create an infrastructure for alternative 
fuel vehicles, including electric vehicles, and to build public 
awareness and confidence in these new modes of transportation. These 
funds include $3.8 million for the Clean Cities initiative; $4.75 
million for infrastructure, systems and safety activities and $1.6 
million for EPAct replacement fuels programs. These outreach, 
education, organization and infrastructure deployment activities by DOE 
encourage investment by industry and help to build market acceptance 
for alternative fuel vehicles.
                               conclusion
    The Electric Transportation Coalition requests that the 
Appropriations Subcommittee on Interior and Related Agencies fully 
support the Department of Energy's advanced automotive and alternative 
fuels programs to further the development of electric and other 
innovative modes of transportation. Successful development and 
introduction of EVs into the market will produce new, high-skill jobs 
in the United States; reduce our growing dependence upon foreign oil by 
substituting plentiful, domestically-controlled, supplies of 
electricity as an alternative transportation ``fuel"; and, most 
importantly, assist in our continuing efforts to reduce the 
environmental impacts associated with the transportation sector.
                                 ______
                                 

      Prepared Statement of the American Public Power Association

    The American Public Power Association (APPA) is the service 
organization representing the interests of over 2,000 municipal and 
other state and locally owned utilities throughout the U.S. 
Collectively, public power utilities deliver electric energy to one of 
seven electric consumers (about 35 million people) serving some of our 
nation's largest cities. The majority of APPA's member systems are 
located in small and medium-sized communities in every state except 
Hawaii. We appreciate the opportunity to submit this statement 
concerning fiscal year 1998 appropriations. We welcome Senators Gregg, 
Campbell, Dorgan and Boxer to this Subcommittee and look forward to 
working with all of you during the 105th Congress. The focus of our 
testimony will be on U.S. Department of Energy (DOE) programs within 
this Subcommittee's jurisdiction.
                   i. doe energy efficiency programs
    APPA supports the Administration's emphasis on DOE energy 
efficiency programs in its funding request for fiscal year 1998. We ask 
that this Subcommittee ensure these important programs continue to be 
among the options available to our nation's electric utilities as they 
strive to meet the increased competitive and environmental demands 
placed on them by the marketplace and society. While we realize the 
budget constraints you face, we ask for favorable action on the 
Administration's request in this area. DOE's energy efficiency programs 
received funding of $717 million in fiscal year 1995. Appropriations 
were cut 25 percent in fiscal year 1996 and were increased by 3 percent 
in fiscal year 1997. The Administration is proposing funding in fiscal 
year 1998 to approximately $688 million, restoring most of the 
reduction from the fiscal year 1995 level. Energy efficiency is 
becoming even more important in the context of debate about electric 
utility restructuring. Due to the uncertain future this has wrought, 
many utilities already have downsized or terminated some energy 
efficiency programs in order to reduce costs. Yet these programs can be 
very helpful in maximizing the overall progress made toward achieving a 
competitive, high-growth economy for our nation while maintaining the 
kind of environmental quality we all desire for the future.
    A. Electric Vehicles (EVs).--EVs provide multiple environmental 
benefits, with special emphasis on reduced tailpipe emissions and ozone 
formation in urban areas. Congress has recognized these potential 
advantages as well as the possibility for EVs to diversify the sources 
of energy used in the transportation sector, decreasing our nation's 
dependence on foreign oil imports and improving our trade balance. APPA 
urges the Subcommittee to maintain support for battery research and 
development through the U.S. Advanced Battery Consortium (USABC). This 
research has produced battery packs that have been installed into EVs 
at utilities and testing facilities of U.S. automobile companies. For 
fiscal year 1998, USABC will require approximately $15.8 million in 
federal funds. In fiscal year 1997, the Site Operator Program (SOP) 
received only $1.6 million. For fiscal year 1998, we encourage the 
Subcommittee to return funding to the fiscal year 1996 level of $2.5 
million. The SOP is a joint effort by government, utilities and 
educational institutions featuring cost-sharing by non-federal 
participants. It tests and evaluates near term electric vehicles and 
associated infrastructure in realistic operating environments and 
demonstrates market opportunities for EVs.
    B. Fuel Cells for Transportation.--We urge the Subcommittee to fund 
DOE's transportation fuel cell program at the $29.6 million requested 
by the President. It is important that these advanced technologies be 
available for application to both mobile and stationary sources. The 
availability of this technology for transportation is critical for 
cities and states that must achieve mandated federal air quality 
standards. The fuel cell vehicle is virtually pollution free and highly 
efficient. Even a 10 percent market penetration could reduce regulated 
air pollutants by more than one million tons a year and emissions of 
carbon dioxide by 60 million tons a year. (This would fulfill the U.S. 
commitment to bring its CO2 emissions back to 1990 levels.) 
It also would save 800,000 barrels of oil a day. One of APPA's members, 
the Sacramento Municipal Utilities District (SMUD), has done extensive 
research in this field because of the outstanding environmental and 
energy efficiency attributes of the technology. We also support DOE's 
$2 million program to develop fuel cells for buildings based on the 
technology developed in the vehicle program.
    C. Community and Building Technologies.--APPA supports the 
Administration's request of $303.4 million to restore previous 
reductions to these energy partnership programs. Among them are Rebuild 
America, designed to accelerate energy efficiency improvements in 
existing commercial and multi-family buildings, and DOE's Energy 
Partnerships for Affordable Homes Program, a collaboration of public 
and non-public groups working to make public and private housing more 
energy efficient and affordable. DOE can play a facilitating role in 
helping bring new technologies and standards to market. Examples of 
valuable DOE efforts in this regard include the Technology Introduction 
Partnerships (TIPS) program and Motor Challenge. TIPS, in particular, 
has been an important one for APPA member systems. Motor Challenge is a 
voluntary partnership between DOE and industry designed to promote 
adoption of motors and motor-driven equipment that increase energy 
efficiency, enhance productivity and improve environmental quality. By 
the year 2000 it is estimated Motor Challenge will generate energy cost 
savings of $1.2 billion and electricity savings of 25 billion kWh.
    Building Codes and Standards.--EPAct also requires each state to 
certify that it has reviewed its residential and commercial building 
codes to determine whether they meet energy efficiency targets. DOE is 
providing important technical assistance to encourage states to adopt 
such codes. We support the Administration's request that $20.5 million 
be provided to continue this program. Of this amount, $11.9 million 
would be used for the building standards and guidelines program and 
$8.6 million for evaluating lighting and appliance standards.
    Community Energy Systems.--District heating and cooling systems act 
as community energy systems by transporting waste energy (from local 
powerplants, industrial processes and natural resources) to buildings 
to provide heating and/or cooling. In addition to reducing emissions of 
carbon dioxide and other pollutants, these systems enhance energy 
security and cost stability, stimulate community development and 
facilitate phase-out of ozone-destroying refrigerants. APPA member 
systems that receive information and technical assistance from this 
program include those located in Burlington, VT; Fairbanks, AK; San 
Antonio, TX; Holyoke, MA, and Lansing, MI. APPA recommends $5 million 
to provide: (1) an integrated information campaign to local and state 
governments and the private sector on the benefits of district energy, 
and technical assistance and cost-shared funding for community energy 
resource assessments and feasibility studies, and (2) research, 
development and demonstration in partnership with ongoing cooperative 
international efforts to reduce costs and improve efficiencies of 
district energy technologies.
    Municipal and Community Energy Management.--This program, within 
the Office of Building Technology, provides funding to municipalities 
for conducting a variety of projects that address energy-related areas 
of greatest concern to local governments. APPA recommends this program, 
operated by the Urban Consortium Energy Task Force (UCETF), receive 
$1.6 million, funding level to that provided in fiscal year 1997. UCETF 
is a program of Public Technology, Inc. (PTI), the non-profit 
technology organization of the National League of Cities, the National 
Association of Counties and the International City/County Management 
Association. Currently 22 jurisdictions, including many public power 
communities, are represented on UCETF: Albuquerque, NM.; Austin, TX; 
Chicago, IL; Columbus, OH; Dade County, FL; Denver, CO; Greensboro, NC; 
Hennepin County, MN; Kansas City, MO; Long Beach, CA; Memphis, TN; 
Monroe County, NY; Montgomery County, MD; Orange County, FL; 
Philadelphia, PA; Phoenix, AZ; Portland, OR; San Diego, CA; San 
Francisco, CA; San Jose, CA; Seattle, WA, and Washington, D.C.
    Weatherization Assistance Program.--APPA wholeheartedly supports 
the Administration's budget request of $154.1 million for 
weatherization assistance, especially important to the working poor, 
elderly and disabled. The program helps more than 100,000 residents 
annually. Weatherization programs have the additional benefit of 
stimulating economic growth by increasing disposable income and 
creating jobs in the service sector. The DOE Weatherization Assistance 
Program has been especially effective at helping low income citizens 
afford their energy bills and at the same time reduce their energy 
usage. The funding increases requested for fiscal year 1998 should be 
provided to this valuable program to help alleviate the multi-year 
backlog of weatherization work requested locally.
    State Energy Conservation Program.--State energy offices work on 
nearly every energy efficiency issue. They encourage technology 
development, renewable energy, alternative fuels, energy emergency 
preparedness, energy facility siting, recycling, transportation 
efficiency programs, energy conservation and economic development, 
among other activities. State energy offices have been extremely 
successful in identifying the needs of local communities, businesses 
and consumers, and funding appropriate efforts to effectively transfer 
technology to constituents. With increased devolution of 
responsibilities to the states, this program offers the ideal 
combination of state-level implementation on a flexible basis with 
federal support. We ask that this Subcommittee favorably consider the 
Administration's request of $45.1 million for the State Energy 
Conservation Program. The program suffered a 50 percent cut in fiscal 
year 1996. The spending level requested for fiscal year 1998 would 
bring the program's funding level up to 85 percent of its fiscal year 
1995 level.
        ii. doe fossil energy research and development programs
    A. Fuel Cells.--Fuel cells have captured the interest of government 
and industry alike. Their modularity, high efficiency and negligible 
emissions of smog and acid rain precursors make fuel cells an important 
growth area deserving national priority. A consortium, including APPA 
member systems, along with the National Rural Electric Cooperative 
Association (NRECA), the Electric Power Research Institute (EPRI) and 
DOE, is co-sponsoring carbonate fuel cell research, testing and the 
first utility-scale demonstration of a carbonate fuel cell powerplant. 
The direct fuel cell program consists of two major efforts--the Santa 
Clara Demonstration Project and the ongoing Product Design Improvement 
(PDI) cost-shared initiative.
    The first demonstration of a U.S.-developed fuel cell powerplant 
has now begun operation in Santa Clara, CA. This 2-MW fuel cell unit 
has been grid-connected for almost 4,000 hours. It has achieved a 44 
percent efficiency level, a record for a fossil fueled powerplant of 
this size, has recorded emissions below conventional detection limits 
and is providing valuable information on fuel cell powerplant 
operations. APPA member systems participating in the consortium include 
the City of Santa Clara, Los Angeles Department of Water & Power, 
Sacramento Municipal Utility District, the City of Vernon, CA, the Salt 
River Project and Northern California Power Agency. The final phase of 
the development effort, the design and fielding of a pre-commercial 
unit, has now begun. Performance and cost targets for this final phase 
are supported by the 21 members of the Fuel Cell Commercialization 
Group (FCCG). In addition to those named as supporters of the Santa 
Clara project, APPA member systems comprising FCCG include Alabama 
Municipal Electric Authority, City of Anaheim (CA) Public Utilities 
Department, Florida Municipal Power Agency, City of Manassas (VA) 
Electric Department, City of Tallahassee (FL) Electric Department and 
Wisconsin Public Service Corporation. In fiscal year 1998, the cost-
shared contract calls for DOE support in the amount of $20 million. We 
urge Congress to fully fund this project so that progress can continue 
toward full commercialization.
    B. Advanced Gas Turbine Program.--APPA strongly supports DOE's 
Advanced Turbine Systems (ATS), Ceramic Stationary Gas Turbine and 
Catalytic Combustion programs. These are model public/non-public 
partnerships to develop more efficient, low-emission turbines for power 
generation in utility and industrial applications. They have been 
strongly endorsed by electric utilities, the natural gas industry, the 
oil industry, electric service industries and industrial users. To keep 
these programs on track toward their long-range goals, which include a 
reduction of liquid and gaseous fossil fuel consumption, $22.2 million 
is needed for fiscal year 1998. Of this amount, $17.1 million would be 
used by the ATS Program; $4.1 million is needed by the Ceramic 
Stationary Gas Program, and $1 million would go to the Catalytic 
Combustion Program. The benefits of this investment can be enhanced and 
made even more effective if DOE accelerates the programs with near-term 
funding increments, rather than decreasing dollars and stretching out 
the program years, as proposed in the Administration's budget.
              iii. energy information administration (eia)
    APPA asks this Subcommittee to carefully review the 
Administration's request, which would result in a 5 percent reduction 
in spending at EIA during fiscal year 1998. We are concerned that this 
level of funding is inadequate to enable EIA to continue its important 
role in data collection and dissemination. With increasing 
competitiveness in the electric utility industry, it is critical that 
utilities, government, regulators and the public all have access to 
reliable data from EIA in order to monitor pricing and structural 
changes in the electric utility industry and their effects on 
competition.
                                 ______
                                 

   Prepared Statement of the Business Council For Sustainable Energy

                              introduction
    The Council is pleased to offer testimony to the Energy and Water 
Subcommittee of the Senate Appropriations Committee on the proper role 
for government in promoting energy research and development, as it 
relates to renewable energy programs at the Department of Energy (DOE).
    The Council is comprised of business leaders who share a commitment 
to pursue a new energy strategy designed to realize our nation's 
economic and national security goals through the rapid deployment of 
efficient, non- and low-polluting energy technologies. Council members 
include a diverse range of manufacturers, energy producers, suppliers 
of energy resources, and energy service companies.
    The diversity of our membership is further reflected in the fact 
that our member companies range in size from Fortune 500 enterprises to 
small entrepreneurial businesses. A list of Council members is 
included.
         federal programs to promote renewable energy resources
    The Council recognizes that it is the suppliers and users of 
energy--not the federal government--that ultimately will decide which 
energy sources will meet our future energy needs. However, the federal 
government does play an important role in helping the private sector 
share the risk of investing in deployment of clean technologies that, 
while at or near economical viability, face financial, informational, 
or institutional obstacles to their wide market availability.
    Today, many efforts using the ``cost-shared'' approach advocated 
during the Bush Administration are mid-course in their program cycles. 
Industry agrees that the cost-shared approach offers the best way for 
the federal government to meet its policy goals in supporting renewable 
energy resources while at the same time ensuring that federal renewable 
energy research efforts are cost-effective. As Congress seeks new ways 
to further lower those costs, the Council strongly encourages Congress 
to preserve the integrity of existing multi-year contracts with the 
renewable energy industry. The Council also urges Congress, when making 
budget cuts, to resist the urge to make broad, indiscriminate cuts that 
may cripple cost-effective and productive renewable energy programs. 
Such cuts have the unintended consequence of freezing industry R&D 
efforts and make the financial community even more reluctant to invest 
in emerging technologies. Further, such cuts run the risk of ultimately 
undermining U.S. competitiveness as our technological superiority in 
renewable technologies is equaled and perhaps surpassed by the 
aggressive research and deployment programs currently being conducted 
by our trading partners in Europe and Japan.
    Notwithstanding the significant progress renewable industries have 
made in reducing costs and increasing technology reliability, barriers 
still remain that slow their commercialization. DOE is engaged in a 
number of programs to help eliminate or mitigate the impacts of these 
barriers. I would like to briefly review a few of these programs that 
the Council believes are particularly effective.
                                  wind
    World markets for wind energy are growing at an unprecedented rate. 
Figures for 1996 indicate that total worldwide installed wind capacity 
stands at 6,190 MW, up 24 percent from a year earlier. This figure 
includes approximately 1,200 MW installed in 1996. The Council expects 
1997 additions to reach nearly 1300 MW. After 2000, The Energy 
Information Administration expects U.S. wind capacity to grow rapidly, 
reaching 12,000 MW by 2015, when wind is expected to generate enough 
power to serve more than three million homes.
    The Council respectfully requests an appropriation of $42.9 million 
for wind energy research and development in the fiscal year 1998 to 
fund projects in next generation wind turbine development ($19.7 
million recommended), cooperative research ($9.1 million recommended), 
and applied research ($14.1 million recommended). This level of funding 
is particularly important to continue development of next generation 
wind turbine technologies needed to keep the U.S. industry competitive 
in restructured domestic markets and in the fast growing, highly 
competitive international markets.
    Wind programs have been a success story for DOE's overall R&D 
program. Although wind is making headway in the electric power 
generation market, present installed wind capacity represents only 0.1 
percent of total U.S. generating capacity. Clearly there are 
opportunities for growth as wind power costs continue to fall. The goal 
of cost-shared DOE/Wind Industry efforts is to develop the next 
generation aimed at delivering electricity in the range of 2.5 cents/
kWh.
    A relatively small increase for Cooperative Research and Testing 
will provide additional support for industry testing at the National 
Wind Technology Center (NWTC) in Rocky Flats, CO. This will allow for a 
completion of efforts to develop U.S. certification and standardized 
criteria for wind energy technologies. Ultimately, streamlined 
certification criteria will make it easier for U.S. businesses to 
market and sell American-made wind turbine technologies in 
international markets.
    The main focus of the applied research program is development of 
models to better understand aerodynamics (through wind tunnel tests), 
fatigue damage prediction and structural reliability capabilities. 
Modeling and code design work is underway at both the national 
Renewable Energy Laboratory (located in Golden, CO) and the Sandia 
National Laboratory (New Mexico).
    More and more electric utilities are becoming interested in 
generating power from large-scale wind powerplants. The world markets 
for wind turbines were valued at $1.3 billion in 1996 and turbines were 
Denmark's second leading export. This market is expected to further 
grow over the next few years. These new markets are driven by the fact 
that at least one-third of the world's population--over 2 billion 
people--do not have access to reliable energy. Maintaining a U.S. 
presence in this growing industry is a valuable investment of federal 
resources--one that will pay off many times in the next several 
decades.
                              solar energy
    The United States currently leads the world in the diverse 
portfolio of solar technologies: photovoltaic, solar water heating, and 
solar thermal electric technologies (solar power tower, parabolic 
Troughs, and dish-engines). However, our international competitors are 
positioning themselves to take market share from the United States in 
vast, multibillion dollar world markets, as a result of strong support 
provided by their respective governments--especially in Japan and 
Germany--through a variety of aggressive development, 
commercialization, and deployment programs. Maintaining our lead will 
require strong and focused U.S. government action, not only to support 
international activities but also to securing a secure position in 
growing and domestic markets.
    Solar technologies available today include photovoltaics (PV), 
solar water and pool heating, solar process heat, and solar thermal 
power technologies. Faster integration of solar energy systems in both 
supply- and demand-side applications in our domestic economy--combined 
with support for increased exports of U.S. solar technologies to take 
advantage of emerging multi-billion dollar markets--will have the 
parallel benefits of creating thousands of new high-technology 
manufacturing jobs and improving our environment. The Council supports 
the trend toward market-driven, industry cost-shared programs designed 
to leverage federal dollars with private-sector participation to 
enhance private-sector understanding and use of these technologies.
    Improving conversion efficiency of solar panels and reducing 
manufacturing costs will play a key role in sustaining U.S. dominance 
in the area of PV. We are recommending $85 million for the Photovoltaic 
Systems Program, one of the best leveraged of any program in the 
Department of Energy. Our two most formidable competitors, Japan and 
Germany, are spending $182 million and $95 million, respectively, to 
jettison their in-country industries into increasingly lucrative world 
markets. One critical factor in the U.S. PV industry's future success 
will be its ability to leverage its financial and intellectual 
resources with those of its strategic partners in the Department of 
Energy to commercialize breakthroughs made in the areas of basic 
materials science, applied research, and systems engineering.
    The Council supports DOE cost-shared initiatives in R&D (thin-films 
and other advanced materials, $20 million recommended) and 
manufacturing (PV-MaT, $18 million recommended) which address these 
issues. Equally important is the concept of building integrated PV 
programs (PV:BONUS, $4 million recommended) where PV manufacturers, 
system integrators, and utilities are working together to reduce the 
cost of PV-generated electricity. Another good model for public-private 
efforts is the ``PV-COMPACT'' program ($14 million recommended), a 
collaborative effort involving more than 80 electric utilities 
(representing over half the electricity production in the U.S.) and 
other interested organizations to garner the economic, commercial and 
environmental benefits of PV technologies.
    PVs and other solar technologies offer the U.S. environmentally 
benign and cost-effective energy supply options in a variety of market 
applications. The market viability of these technologies is 
demonstrated in growing private sector interest in developing new 
manufacturing facilities related to solar industries. In the area of PV 
production alone, the last two years have witnessed six U.S. 
companies--including Council members United Solar Systems Corporation 
and Amoco/Enron Solar--announce plans to construct new photovoltaic 
plants. This activity is a unique example of DOE funding encouraging 
significant private-sector investment that creates new jobs. The 
Council strongly urges Congress to continue its support of public/
private partnerships that help ensure that U.S. companies can compete 
effectively in rapidly emerging world renewable energy markets.
    The Council recommends $5.7 million in funding for the Solar 
Thermal Buildings program, a research and development program focusing 
on materials and components for solar water and space heating 
technologies for building applications. Based at the National Renewable 
Energy Laboratory and the Florida Solar Energy Center, the program also 
has a strong technology standard and certification component. 
Activities in fiscal year 1998 should include ongoing cost-shared 
technology validation projects, laboratory R&D, and customer-oriented 
applied R&D of solar building technologies with universities and 
industries.
    The Council recommends a total of $27 million for the Solar Thermal 
Electric and Process Heat programs, an R&D program on materials and 
components with a heavily cost-shared technology validation component. 
Over the past five years, the primary program focus has been 
collaboration with industry to develop advanced solar thermal electric 
technologies to the point of commercial readiness.
                        international activities
    Finally, the Council would like to offer its support of federal 
programs designed to help open important international markets for 
renewable technologies, including DOE programs such as the Committee on 
Renewable Energy, Commerce and Trade (CORECT) and GT-World.
    The developing world--Eastern and Central Europe, the former Soviet 
Union, Asia, Africa, and Latin America--presents tremendous 
opportunities for the deployment of renewable energy technologies. 
Renewables offer great flexibility to developing countries looking for 
economically viable, reliable, and clean energy supply options that can 
be used to serve growing metropolitan areas and remote rural regions 
where power is otherwise unavailable. Renewables can also help support 
the development of commercial activities such as agriculture and 
telecommunications through remote power source applications. 
Competition in rapidly growing developing country markets is intense; 
U.S. renewables manufacturers face the dual obstacles of competition 
from conventional energy sources and foreign renewables manufacturers 
buoyed by government assistance.
    In this regard, it is important to note that major U.S. competitors 
are now making aggressive moves into the renewables market. When 
measured against the relative size of their economies, Japan, Germany, 
and Sweden are each now making larger government R&D investments in 
renewables that the U.S. In fact, the U.S. taxpayer spends a lower 
portion of its R&D budget on energy than any other taxpayer in an 
industrialized, market-based economy.
    U.S. Government assistance in identifying market opportunities, 
providing education and training for energy decisionmakers in the 
developing world, and supporting demonstrations of renewable 
technologies in overseas applications promises to help ensure that U.S. 
renewables manufacturers will be successful in capturing market-share 
throughout the expanding global market for clean energy technologies 
and services.
                               conclusion
    Promoting research, development and validation of emerging 
renewable energy technologies will result in the near-term creation of 
thousands of new jobs, a stronger economy, enhanced export 
opportunities for domestic manufacturers, and a cleaner environment. 
DOE's budget request continues federal emphasis on developing low-and 
non-polluting energy technologies and services as a means of achieving 
these goals. It utilizes cost-shared collaboratives with industry to 
leverage limited federal funds in recognition that cooperation with 
industry is vital for addressing market imperfections impeding the 
widespread use of renewables. The Council strongly supports this 
approach, and urges Congress to continue its support of federal 
research, development and validation programs for renewable energy 
technologies.
                                 ______
                                 

  Prepared Statement of Father William L. George, S.J., Assistant for 
                Federal Relations, Georgetown University

    Mr. Chairman and members of the Committee, I am Father William L. 
George, S.J., assistant to the President of Georgetown University, the 
Reverend Leo J. O'Donovan, S.J. Thank you for the opportunity to 
testify on the Fuel Cell Transit Bus Research and Development Program. 
In the past, this Committee has strongly supported the introduction of 
this key transportation technology. Your vision has successfully 
developed three, 30-foot Fuel Cell powered transit buses. These buses 
are the only Fuel Cell powered vehicles in the world capable of 
operation on liquid fuel, and currently undergo testing in various 
locations around the country.
    In fiscal year 1998, we request this committee augment the National 
Park Service (NPS) Grand Canyon Project by $1.2 million to develop the 
introduction of a Fuel Cell powered transit bus fleet amenable to the 
park operation. A specification should be included to properly identify 
Fuel Cell technology as most beneficial to the needs of the Grand 
Canyon. The suggested Fuel Cell technologies are those being developed 
under a ETA Grant to Georgetown. This activity will be the harbinger of 
the first pilot production Fuel Cell bus fleet in the country. This 
opportunity leverages all the R&D efforts of the past to solve a 
critical need of the NPS and provides a clear path for the introduction 
of the Fuel Cell technology into the transit industry.
    Two years ago, I testified that the commercialization of Fuel Cell 
technology would pass to the Federal Transit Administration (ETA). 
Funds have been provided to develop a commercially viable 40-foot Fuel 
Cell bus using a domestic Fuel Cell manufacturer. Two such vehicles are 
being fabricated, each with a different type of Fuel Cell. The first, 
which we consider a commercial prototype based upon the initial program 
authorized by this subcommittee, should be delivered in the fall of 
1997. The second is more developmental in nature and is due sometime 
later. Both are 40-foot transit buses that are designed to achieve 
commercial production.
    The next step to commercialization is to build a small, pilot-
production fleet of buses, and apply it to a real-world situation. To 
gain wide user acceptance, it is important to choose an operation which 
provides a showcase to a broad segment of potential bus riders and 
where the attributes of the Fuel Cell power system are absolutely 
essential. The problems of the Grand Canyon National Park provide an 
ideal opportunity.
    Traffic congestion at the Grand Canyon National Park exceeds 
available road and parking capacity. The noise and pollution greatly 
detract from the serene beauty of one of our greatest National 
landmarks. The Park must convert to a pedestrian and transit-oriented 
facility. The conversion will initially require a fleet of at least 25 
transit vehicles. The NPS has made a commitment to use a transit fleet 
that is environmentally sensitive to noise and exhaust emissions. The 
NPS is currently working through the preliminary concept phase of the 
transit planning for this system.
    We strongly endorse the efforts of the Park Service to preserve the 
pristine natural setting of the Grand Canyon and believe that Fuel Cell 
powered transit buses offer the most promise. The Fuel Cell bus will 
introduce citizens from all over the country to the next generation of 
power systems. This highly visible program will serve as an exemplar of 
shared technology satisfying both Interior and commercial transit 
applications. The needs of the Grand Canyon and the commercialization 
of Fuel Cell technology for transportation will be advanced by this 
activity.
                                 ______
                                 

       Prepared Statement of the Clean Coal Technology Coalition

                            i. introduction
    This testimony concerns fiscal year 1998 funding for the Department 
of Energy's (DOE) Clean Coal Technology Program. This written statement 
is submitted on behalf of the Clean Coal Technology Coalition (CCTC or 
Coalition), a public/private organization of electric utilities, coal 
companies, technology developers, state governments' universities and 
others organized to encourage the development and deployment of clean 
coal technologies.
    The members of the Coalition understand the budgetary pressures 
resulting from fiscal constraints facing the federal government. 
However, we also understand the value of the federal government role in 
supporting prudent long-term investments in quality programs. The CCTC 
strongly urges the Congress not to sacrifice such important investments 
in our Nation's future for immediate and limited budgetary savings. We 
encourage the Members of the Subcommittee to maintain a course toward 
completion of the highly successful Clean Coal Technology Program (CCT 
Program).
    The CCT Program is a jointly funded partnership between government 
and industry to demonstrate a new generation of innovative coal 
processes in a series of showcase, cost-shared demonstration projects. 
The CCT Program has been, and continues to be, an extremely successful 
public/private partnership in which government and industry have formed 
effective partnerships in making sustained progress toward long-term 
goals.
    Last year, $124 million was rescinded by Congress from the CCT 
Program. This was in addition to $200 million that had previously been 
rescinded from the CCT Program by the Congress. These reductions have 
significantly affected the implementation and administration of the CCT 
Program and any additional reduction in funds could seriously impact 
the integrity of the program. The members of the Coalition urge 
Congress to defer any additional funding cuts and support the 
successful completion of this important, and successful program.
    The members of the Coalition support full funding for the DOE cost 
share of the remaining CCT Program projects. We believe that government 
should fulfill its commitments accepted in good faith by the private 
sector. We encourage the Congress to ensure sufficient funds are 
available for all projects which the DOE and the industry partner have 
determined should be continued and completed.
    For fiscal year 1998, the Administration proposes to rescind an 
additional $153 million and defer the release (or payment) of $133 
million in unobligated CCT Program funds until fiscal year 1999. The 
Coalition understands that the Administration's request is predicated 
upon the cancellation of previously selected projects and the combining 
of other selected projects and the funds, therefore, are no longer 
needed.
    In addition to its proposal to rescind an additional $153 million, 
the Administration is seeking an advance appropriation of $50 million 
to be made available in fiscal year 1999 to initiate the development of 
an international clean coal technology program. If approved, these 
funds are intended to ``offset'' part of the proposed $153 million CCT 
Program funding cut. The Coalition has taken a position in support of 
international cooperation and demonstration of clean coal technologies. 
We strongly believe in the importance of successfully demonstrating 
clean coal technologies, either domestically or in the international 
arena. However, DOE participation in international clean coal 
technology projects has been evaluated by the Congress in the past and 
was rejected. Therefore, unless there is a change in the will of the 
Congress, we are not able to view this proposed funding as an offset to 
the funding cut in the CCT Program. Indeed, the outcome of the 
Administration's request may simply be a rescission of the $150 million 
and no addition of $50 million for an international project in fiscal 
year 1999. Further, the outcome might simply be an additional $50 
million reduction in the program. This decision would be made in 
conjunction with the fiscal year 1998 budget to be effective in fiscal 
year 1999. We urge the Congress not to make such a conclusion.
    Given the fact that the Clean Coal Technology Program is a 
technology development program, it is possible that projects might 
experience cost overruns or expected reductions in technology costs may 
not be realized as rapidly as expected. In such cases, more funding to 
achieve technology/program related goals would be required. To that 
end, sufficient funding must be available to provide the DOE adequate 
flexibility to ensure the goals of the Program can be achieved and the 
accomplishments to date are not lost. The Coalition recommends that if 
a rescission is to be made, the Congress rescind not $153 million, but 
rather $100 million, leaving the requested advance appropriations for 
an international program in the clean coal domestic budget as a 
``safety net'' for ongoing projects or clean coal-related initiatives 
that will have the support of Congress and the Administration.
    As the Subcommittee considers fiscal year 1998 appropriations 
allocations, we urge your continued support for this quality program 
that has assisted, and will continue to assist, efforts to obtain 
benefits derived from clean, efficient, and economic, coal-based power 
generation.
    ii. the clean coal technology program--a successful cooperative 
                              undertaking
    In 1986, the DOE established the CCT Program as an industry/
government partnership for sharing the costs of projects that 
demonstrate innovative technologies for using coal in a more 
environmentally sound, efficient and economical manner. The CCT Program 
was borne out of recommendations by the U.S./Canadian Special Envoys on 
Acid Rain and approved, and finally recommended, by former Canadian 
Prime Minister Brian Mulroney and President Ronald Reagan. The 
establishment of the CCT Program responded to the need to insure that 
the Nation's energy demands are met, in part, by our most abundant 
energy resource--coal--in an environmentally responsible manner that 
does not jeopardize the attainment of air quality standards. Clean coal 
technologies meet these needs.
    Much of the CCT Program's success is based upon its unique 
structure. First, unlike many other federal programs, the CCT Program 
was designed to serve a specific mission: to demonstrate a variety of 
clean coal technologies. Once the selected projects are completed, the 
CCT Program will end. Second, industry is assigned a critical role in 
the project selection process. Rather than select technologies, the 
government assists in the development of technologies chosen as most 
promising by industry. Third, the CCT Program contains a repayment 
provision. Not only do U.S. taxpayers gain the environmental, energy 
efficiency, national security and job creation benefits associated with 
the development of clean coal technologies, but when the technologies 
are successfully marketed, project participants are required to repay 
the government for federal financial support received. Finally, and 
most important, the CCT Program is a cost-shared venture. Nearly two-
thirds of all CCT Program funds have been supplied by the private 
sector (industry has invested approximately $4 billion and the Federal 
government $2 billion in the Program, even though the program only 
requires 50/50 cost-sharing.)
    The CCT Program has been implemented by the DOE through five 
solicitations and currently consists of 40 showcase demonstrations that 
are either completed, or underway, in locations across the country. 
Success of this public/private partnership may be measured by several 
factors: first, the majority of the 40 projects are completed, in 
operation, or under construction; second, for every $1 invested by the 
Federal government, private companies and states have contributed 
approximately $2, making the CCT Program one of the most successfully 
leveraged technology-development ventures managed by the U.S. 
Government; third, millions of dollars worth of commercial sales of 
clean coal technologies have been realized, thousands of new U.S. jobs 
are being supported by clean coal technology projects and the U.S. 
balance of trade has benefited (and will continue to benefit) from 
export sales of clean coal technologies.
          iii. the importance of completion of the cct program
    The federal government plays a critical role in the CCT Program by 
providing ``seed'' funding and support for these new technologies. 
Government support of clean coal technologies has mitigated the high 
risks and costs associated with technology development and the lack of 
economies of scale that attends the initial demonstration of a 
technology. In turn, this support has increased the rate of development 
and deployment of clean coal technologies. Government participation has 
been, and continues to be, vital to the successful and timely 
introduction of clean coal technologies into the marketplace.
    At the inception of the Program, Congressional appropriators had 
the foresight to provide advance appropriated funds for the clean coal 
program. This innovative funding process assured the private sector 
that the government was a committed and reliable partner and provided 
the security required by industry to invest large sums of capital into 
the CCT Program. To slash funding at this point would: (1) forfeit a 
relationship that the federal government and industry have worked hard 
to nurture and develop; (2) break government's commitment to partner 
with industry in the 40 clean coal technology demonstration projects; 
and, (3) destroy an important bond of trust. It is vitally important 
that sufficient funding be provided to the CCT Program, not only for 
the purpose of honoring government commitments, but also to provide the 
U.S. market with advanced technologies for future power generation 
needs. Adequate funding will allow the program to continue, projects to 
be completed, technologies to mature, and enable U.S. companies to 
access the potentially enormous clean coal technologies export market.
      iv. clean coal technologies yield multiple national benefits
    Currently, coal is used to generate 56 percent of U.S. electricity 
and is emerging as a feedstock for the production of alternative 
transportation fuels and chemicals. According to the Energy Information 
Administration, coal is expected to fuel about 50 percent of U.S. 
electricity production through the year 2015 and coal will continue to 
be the primary source of electric power well into the next century, not 
only in this country, but for much of the world. Given these facts and 
projections, the United States is presented with an extraordinary 
opportunity to market its new, cleaner, coal-based power systems 
overseas which will create new U.S. jobs and help reduce the U.S. trade 
deficit.
    Clean coal technologies allow the Nation not only to meet current 
and future power generation needs while utilizing our most abundant 
energy resource--coal--but also to provide that power in an 
environmentally sound manner. This is an important point. Without new 
technology, it may be difficult for generating companies to respond to 
increased electricity demand, comply with environmental regulations 
and, at the same time, refrain from increasing the cost of electricity 
production and electricity prices to consumers. Given that $200 billion 
from our economy goes for the purchase of electricity yearly, any 
economic penalty could erode U.S. competitiveness and limit economic 
growth.
    The clean coal technologies under development have proven 
successful in removing and preventing emissions. The various clean coal 
technologies can remove 30 to 90 percent of nitrogen oxides and 50 to 
99 percent of sulfur dioxides from the combustion of coal. Also, 
because some of these technologies are more efficient converting coal 
to useful energy, significantly less CO2 is emitted.
    In addition to significant environmental benefits, CCTs already 
have benefitted our domestic economy through revenue from sales and 
jobs creation. Further, a significant potential exists to export clean 
coal technologies which, in turn, will create additional U.S. jobs. 
Global electricity demand, particularly in developing countries, is 
rapidly increasing. To meet that demand, many nations will rely upon 
indigenous coal resources and foreign capital to finance utility 
projects. In fact, the U.S. Department of Energy estimates that the 
total world market for CCTs is between $250-750 billion through the 
year 2010. If the U.S. were to capture only 20 percent of that export 
market, DOE estimates as many as 29,000 to 43,000 U.S. jobs would be 
created.
                             v. conclusion
    The Clean Coal Technology Coalition understands the budgetary 
constraints faced by the federal government and respects congressional 
action to consider plans to reduce federal spending. We ask that the 
Clean Coal Technology Program, an effective program which promotes and 
achieves multiple national goals and benefits, not be sacrificed for 
immediate savings. In the long-term, such actions only would result in 
a net loss for U.S. taxpayers from lost jobs, exports, cleaner 
technologies and domestic fuel security.
                                 ______
                                 

 Prepared Statement of Gary A. Styles, Manager, Planning and Analysis, 
  Power Systems Development Facility, Southern Company Services, Inc.

                              introduction
    Mr. Chairman and members of the committee. This statement of 
Southern Company Services, Inc., (``SCS'') is in support of $20 million 
for the Wilsonville Power Systems Development Facility in the Advanced 
Clean and Efficient Power Systems Program requested in the U.S. 
Department of Energy (``DOE'') Fossil Energy R&D budget for fiscal year 
1998. Specifically, the budget request is for $10 million in the high 
efficiency--integrated gasification combined cycle activities and $10 
million in the high efficiency--pressurized fluidized bed combustion 
activities. SCS would also like to request that the budget for the 
pressurized fluidized bed combustion activities be increased by an 
additional $2 million ($12 million total) to fund startup and 
commissioning of the advanced pressurized fluidized bed combustion 
(``APFBC'') train and support projects. Construction of the APFBC is 
currently scheduled for accelerated completion in fiscal year 1998. 
Acceleration of APFBC construction will result in lower overall cost to 
project but will increase project cash flow for fiscal year 1998. 
Without this additional $2 million, completion of startup and 
commissioning of the APFBC train at the PSDF may be delayed.
    Southern Company is actively involved in many areas of research 
including technologies that can be used by the affiliated operating 
companies to produce power more efficiently. In particular, Southern 
Company, through SCS and its operating companies, supports and conducts 
research that will help the nation utilize its coal resources while 
minimizing the environmental effects of using one of our nation's most 
plentiful and valuable resources. As a result, SCS has participated in 
projects in both DOE Clean Coal Technology program and the DOE Fossil 
Energy Research and Development program.
    The purpose of this testimony is to request this Subcommittee's 
continued support for the Power Systems Development Facility (``PSDF'') 
for advanced coal gasification and pressurized combustion research. SCS 
would also like to express appreciation to this Subcommittee for 
previous support for advanced fossil energy research. SCS specifically 
requests a minimum of $22 million for the PSDF project in fiscal year 
1998. This request assumes that the full $22 million for fiscal year 
1998 and the full $22 million that was approved by this committee for 
fiscal year 1997 are available to the project.
                objectives of the psdf research program
    The objectives of the PSDF research program, in conjunction with 
other DOE research projects and programs, are to reduce technical risk, 
improve environmental performance, and reduce the cost of producing 
electricity from coal, our nation's most abundant fossil fuel resource. 
For many reasons, natural gas fired combustion turbines and combined 
cycle power plants are currently the most cost-effective electric power 
generating technologies in many areas of the United States. Natural gas 
fired power plants are projected to capture over 50 percent of new 
electric generation capacity over the next 10 to 15 years. However, 
many may remember that less than 15 years ago, electric utilities were 
prohibited by federal law from burning natural gas to produce 
electricity due to shortages of natural gas and its importance to 
domestic heating. During this period of energy stability, we must not, 
as a nation, become complacent or we may face another energy crisis in 
the future. Our nation needs competitive, cost effective, clean, and 
efficient coal-based technologies to meet our future electric energy 
needs.
    The fundamental purpose of the PSDF is to support the national 
program to assure competition between energy resources and, thereby, 
keep electricity prices low. Coal reserves currently accounts for over 
90 percent of the U.S. combined energy reserves supplies over 56 
percent of the energy for electric power generation. Coal is still our 
nation's lowest cost fossil fuel. However, for coal to continue to be a 
cornerstone of our national energy policy, we must reduce the capital 
cost of new coal fired power plants by at least 20 percent while 
simultaneously increasing efficiency and improving environmental 
performance. To accomplish these objectives, we must improve the 
reliability of individual plant components and optimize system 
integration and performance. This type of research can be accomplished 
most cost effectively at a dedicated pilot-scale development facility 
such as the PSDF. The PSDF is designed to be the U.S. test facility to 
support the Clean Coal Technology program and advanced coal-based power 
generation development for the next five to 15 years.
           description of power systems development facility
    The Wilsonville PSDF is a joint industry/DOE facility for 
engineering-scale testing and development of devices to remove 
particulates and other contaminants from hot gas in high-efficiency 
coal gasification and pressurized fluidized-bed combustion power 
plants. SCS and our industrial partners are supplying over $40 million 
in cost sharing to the PSDF project. The industrial partners, which 
represent a major portion of the domestic electric power generation, 
power generation design and manufacturing, construction, and coal 
mining include: M.W. Kellogg, Inc., Peabody Coal, Foster Wheeler 
Corporation, Southern Research Institute, Westinghouse Electric 
Corporation, Combustion Power Corporation, Industrial Filter & Pump, 
Inc., and the Electric Power Research Institute. Three of the 
industrial partners, Foster Wheeler, M.W. Kellogg, and Westinghouse are 
also actively involved in Clean Coal Technology demonstration projects 
that will enhance commercialization opportunities for technologies 
being developed at the PSDF. Southern Company, and its industrial 
partners in the PSDF, have financial incentives to see that 
technologies successfully developed at Wilsonville and other sites are 
effectively implemented in the market place.
    In addition to the Wilsonville, Alabama plant site, components for 
the facility are being developed at the following locations: Grand 
Forks, North Dakota (gasifier development), Houston, Texas (gasifier 
development); Livingston, New Jersey (combustor development); Menlo 
Park, California (filter fabrication); Cicero, Illinois (filter 
fabrication); Orlando, Florida (gas turbine burner), and Pittsburgh, 
Pennsylvania (filter fabrication).
    High-temperature, high-pressure gas cleanup must be perfected in 
order to use new high-performance gas turbines in coal-based power 
plants. When fully developed, these technologies will: (1) improve the 
efficiency of power generation from coal by over 25 percent compared to 
pulverized coal power plants with a corresponding reduction in 
CO2 emissions; (2) lower the cost of electricity by over 20 
percent; (3) be more acceptable to coal-based utilities than today's 
coal-gasification combined-cycle designs; and (4) reduce pollutants by 
over 95 percent.
    The PSDF will be the focal point for much of America's advanced 
electric power generation technology development in the 1990s and into 
the twenty-first century. Current plans call for the facility to 
contain five modules: (1) an advanced pressurized fluidized-bed 
combustor (``PFBC''), an extremely clean method for burning coal; (2) a 
transport reactor gas source, an advanced type of coal gasifier and 
pressurized combustor; (3) a hot gas cleanup module to test filters for 
removing fine particles and other contaminates from coal gases; (4) an 
advanced burner-gas turbine module; and (5) an advanced fuel cell. At 
the PSDF, private developers will be able to test innovative electric 
power system components--new combustors, improved cleanup systems, and 
advanced turbines and fuel cells--at a central location, saving the 
time and expense of building separate test facilities.
    The Wilsonville PSDF offers a number of advantages to the utility 
industry and to the nation by being able to address issues for the 
near, middle, and long-term management of technology risk:
  --The testing of hot gas cleanup systems addresses near-term 
        developmental needs, and the schedule of the PSDF is geared 
        towards providing support to Clean Coal Technology (``CCT'') 
        projects for advanced power generation as these projects enter 
        the design and operational phases.
  --The advanced pressurized combustion process offers the potential of 
        a high efficiency system for the mid-term that may be widely 
        used in repowering applications or in greenfield plants.
  --The transport gasifier/combustor has significant commercial 
        potential due to its compact size and resulting lower capital 
        cost.
  --The integrated gasification/fuel cell concept is a system that has 
        the potential to become the most efficient and environmentally 
        superior coal-based system available over the long-term.
    Another important aspect of the technologies being developed at the 
PSDF is the interaction with technologies being developed in other DOE 
programs such as advanced turbine, filter development, and the fuel 
cell programs. The Wilsonville PSDF will be the only facility in the 
world where all the components of an advanced coal-fired power plant 
can be tested in an integrated system at a practical engineering scale 
prior to assuming the risk and cost of commercial applications. This 
facility and other DOE fossil energy programs will allow U.S. electric 
utilities to maintain reasonable domestic energy prices and for U.S. 
equipment suppliers to gain a technological advantage in electric power 
production that can help increase competitiveness in foreign 
electricity markets.
                       status of the psdf project
    Construction of the M.W. Kellogg transport reactor train was 
completed in May 1996 and startup in the combustion mode began in 
August. By the end of 1996, over 800 hours of fluid mechanical testing 
were successfully completed including over 230 hours of operation on 
coal. In 1997, the transport reactor will be operated in both the 
combustion and gasification modes and tests on different particulate 
control devices will begin. Construction and startup of portions of the 
Foster Wheeler advanced PFBC (APFBC) system are scheduled to be 
completed in 1997. Tests of the fully integrated Foster Wheeler APFBC 
are scheduled to being in early 1998.
                               conclusion
    The United States has always been a leader in energy research. 
Current DOE fossil energy research and development programs for coal 
will assure that a wide range of technology options continue to be 
available for future needs. We recognize the difficult choices that 
confront Congress when it examines the near-term effects of research 
programs on the Federal budget. We believe, however, that supporting 
advanced coal-based energy research today, in programs like the PSDF, 
will be a net plus for the economy, the federal government, and the 
American people over the long run. For the foregoing reasons, SCS 
requests your continued support for the Power Systems Development 
Facility by including $22 million in funding in the Department of 
Energy's Fossil Energy Budget. We thank you for the opportunity to 
appear before you today.
                                 ______
                                 

   Prepared Statement of the Business Council for Sustainable Energy

                            i. introduction
    The Business Council for Sustainable Energy (BCSE) is pleased to 
offer its views on the role of government in support of energy research 
and development--as it relates to energy efficiency programs at the 
Department of Energy (DOE).
    The BCSE is comprised of a diverse group of companies. Our members 
represent manufacturers, investor-and municipally-owned electric and 
natural gas utilities, energy marketers, laboratories, associations, 
and energy service companies. Our diversity is also reflected in the 
size of our member companies. We have Fortune 500 enterprises and small 
entrepreneurial businesses as members. The BCSE supports energy-related 
policies and programs that enhance the nation's economic and national 
security goals through the rapid deployment of efficient, non- and low-
polluting technologies.
    The BCSE's membership adds value to government policies and 
programs by forming consortia and engaging in cost-shared partnerships, 
leveraging limited federal resources, and advancing U.S. industrial 
competitiveness. The international marketplace is more heavily 
subsidized by foreign governments than ever before. In fact, as a 
percentage of gross national product, U.S. government investment in 
non-defense research and development (R&D) remains well below that of 
our fiercest competitors, Japan and Germany.
    We believe that energy efficiency can become an even greater force 
in our economy and offset reliance on foreign oil, while reducing our 
production of greenhouse gases, and providing new high-technology, 
high-paying American jobs. Increased federal emphasis on energy 
efficiency is arguably the least costly and intrusive means to 
accomplish the goal of an economically viable sustainable energy 
future. The BCSE will not attempt to address all of DOE's energy 
efficiency programs given their breadth and diversity. Rather, we will 
focus on a few programs that illustrate the value of federal support.
                     ii. the transportation sector
    Perhaps the best indicator of our Nation's need to advance 
alternative-fuel vehicle (including natural gas and electric vehicles) 
research, is the current record high level of U.S. oil imports, (52 
percent) which is projected by the Energy Information Agency (EIA) to 
reach 63 percent by the year 2005. These imports contribute 
significantly to our trade deficit and threaten our economic security, 
as the Persian Gulf countries are expected to control over 70 percent 
of the global oil market by the year 2010.
Alternative fuel vehicles
    As surface transportation in the U.S. is virtually 100 percent 
dependent on petroleum, alternative fuel vehicles (AFV), by definition, 
are the only solution to the transportation sector's vulnerability. 
Although AFVs are available today, much more research must be done and 
technical advances realized before either natural gas (NGV) or electric 
vehicles (EV) will be universally accepted, reliable, and cost-
competitive.
    The BCSE is supportive of DOE's system optimization and tank 
storage research for NGVs, particularly in the industry's priority area 
of high fuel-use NGVs. By utilizing advanced composite materials, 
compressed natural gas (CNG) storage systems can be manufactured to 
require less weight for equal or greater amounts of fuel storage.
    The BCSE is also supportive of DOE's Clean Cities Program, which in 
fiscal year 1998 will expand its partnerships to 65 cities across the 
nation, assisting state and local governments with AFV refueling 
infrastructure development, education, and technical assistance. The 
nation-wide infrastructure corridor will be extended and a long 
anticipated expansion of the Clean Cities electric vehicle deployment 
program will be undertaken. Our members are putting their money behind 
these endorsements. While we invest in infrastructure advancements, our 
members are simultaneously building their fleets. By the end of 1997 
BCSE members, Brooklyn Union, headquartered in New York, will have 916 
NGVs in its fleet (over 85 percent of its total fleet) and Pacific 
Enterprises, headquartered in California, will have 765 NGVs.
Battery technology
    The battery provides an example of a promising technology for 
electric vehicles. BCSE member Energy Conversion Devices, headquartered 
in Michigan, which produces the Ovonic Nickel-Metal Hydride battery, is 
a member of the U.S. Advanced Battery Consortium. Fifty-five percent of 
funding for this important partnership is provided by the private 
sector. Advanced mid-term batteries will double the approximately 70-
mile vehicle range compared with conventional lead-acid batteries, and 
the Ovonic Nickel-Metal Hydride battery has met or exceeded the mid-
term performance goals set by the Consortium. The electric battery and 
other promising energy storage technologies could redefine 
transportation, ending the transportation sector's reliance on foreign 
oil.
                  iii. utility/power generation sector
    EIA projects that cogeneration and non-utility applications in the 
U.S. will account for nearly 58 percent of all new electric generating 
capacity built over the next 20 years. Natural gas powered industrial 
turbines and fuel cells are the prime cogeneration candidates to meet 
the projected capacity demand.
Fuel cell technology
    The BCSE is very supportive of DOE's fuel cell programs in the 
power generation, building, and transportation sectors. One of the 
BCSE's members, International Fuel Cell, headquartered in Connecticut, 
is engaged in cost-shared partnerships with the federal government. 
Fuel cell power systems are poised to enter the market for distributed 
power generation and, in the future, will be available in the future in 
a variety of sizes and types to fill the diverse power generating needs 
of the commercial, industrial and utility sectors. Fuel cells are very 
efficient energy converters. Compared to the average 35 percent 
efficiency of the present electrical grid, the projected fuel-to-
electric conversion efficiency for fuel cell power plants range from 45 
percent, for the units about to enter the market, to 70 percent for 
units that could become available by 2010. The ultra-low emissions and 
``good-neighbor'' features of fuel cells enable them to be sited close 
to the end users, eliminating losses associated with long-distance 
transport over high-voltage lines. The ultra-low emissions include 
virtually zero NOX and SO2 levels, and the lowest 
CO2 emissions of any fossil fuel power plant.
    In the transportation sector, the DOE anticipates that light-duty 
fuel cells will begin to enter the market by 2008. By 2020, it is 
projected that 75,000 barrels per day of oil could be displaced, 
amounting to $1.2 billion in energy cost savings and 2.9 million metric 
tons of carbon equivalent emission reductions. The worldwide market for 
fuel cells across the power generation, building, and transportation 
sectors is projected to be $3 billion per year in the post-2000 era 
with an exponential growth in the market after 2010.
Gas turbines
    The BCSE strongly supports DOE's Industrial Advanced Turbine 
Systems Program. EIA's 1996 Energy Outlook and the Gas Research 
Institute Baseline Projection of U.S. Energy Supply and Demand (1996 
Edition), both project that total gas demand for electricity generation 
is projected to grow from 4.3 quads in 1994 to over eight quads in 
2015. The portion of this gas demand in industrial and commercial 
cogeneration is projected to more than double, from 1.1. quads in 1994 
to 2.7 quads in 2015. Solar Turbines, a BCSE Member, is a solely-owned 
American corporation headquartered in California. Solar Turbines is the 
leading manufacturer of industrial-scale turbines. Solar Turbines is 
expected to be the first in the marketplace with the efficiency and 
environmental improvements emanating from the successful cost-shared 
partnership with DOE. fiscal year 1998 research will be geared toward 
reducing NOX emissions at the higher temperatures (required 
to increase system efficiency) without increasing emissions of CO or 
unburned hydrocarbons.
Utility programs
    DOE also has worked effectively with utilities and power 
authorities to promote energy efficiency. Through voluntary programs 
such as Climate Wise, DOE has obtained the commitment of industry to 
reduce its emission of greenhouse gases. Generally, activities that 
reduce emissions also reduce energy use. Climate program participants--
such as BCSE member Sacramento Municipal Utility District (SMUD)--have 
premised their programs on sound economic principals. In fact, SMUD 
attributes its aggressive support for energy efficiency as a primary 
reason it has been able to stabilize its electricity rates.
                         iv. the building sector
    The building sector (residential and commercial buildings) 
currently uses 32 quadrillion Btu (quads) of primary energy annually. 
This is about 36 percent of total U.S. energy consumption, and includes 
66 percent of all electricity and 25 percent of all natural gas used in 
the nation. This energy costs consumers about $220 billion annually. 
The average household spends about $1,300 per year on domestic energy 
(excluding associated externalities). Energy consumption in buildings 
also has serious environmental implications. Carbon dioxide emissions 
attributable to primary energy use in U.S. buildings alone are roughly 
equivalent to the total emissions of Japan and the United Kingdom 
combined.
Natural gas cooling technology
    Natural gas cooling is very energy efficient, especially when 
measured on a life-cycle basis (measuring energy from its source 
through transmission and distribution to the site), and its low-
emission properties make it environmentally friendly. Additionally, 
natural gas cooling is used during the periods of the day and days of 
the year that correspond to the peak demand for electricity generating 
capacity, thereby benefiting gas customers and gas and electricity 
providers. BCSE member York International, headquartered in 
Pennsylvania, is engaged in a cost-shared partnership with DOE toward 
the development of a large natural gas commercial chiller. The cost-
effective and efficient York chiller will allow end-users to provide 
for both the cooling needs and thermal requirements of their building. 
The planned market introduction is scheduled for 1998.
    DOE and BCSE member American Standard Companies, headquartered in 
New Jersey, and its subsidiary Trane, headquartered in Wisconsin, are 
developing a highly efficient air pre-conditioner system to be 
incorporated into Trane's ``Climate Changer'' commercial product line. 
Desiccant dehumidification-based cooling systems are beginning to show 
real promise, and DOE technical and marketing studies are an essential 
component for assured broad commercialization. Similarly, with support 
from DOE, Engelhard/ICC is developing unique desiccant systems with 
heat exchange technology to independently reduce both humidity and 
temperature while drawing 100 percent fresh air from the outside. 
Indoor air quality is a serious public health issue today and the 
American Society of Heating, Refrigeration and Air-Conditioning 
Engineers has recently promulgated ventilation requirements for 
building systems (ASHRAE-62).
Standards and insulation
    DOE has played a constructive role in providing educational and 
technical support of building codes and standards such as the Model 
Energy Code and ASHRAE 90.1. These codes and standards--promulgated by 
private-sector organizations--help ensure that our nation's housing 
stock reflects good building construction practices and is reasonably 
energy efficient. In addition, DOE has published industrial insulation 
guidelines that will significantly improve energy efficiency in this 
sector of the economy. DOE is currently providing educational and 
technical support to help industry implement the guidelines. DOE also 
has provided valuable technical assistance to the polyurethane foam 
insulation industry, helping the industry find a substitute for CFCs as 
a blowing agent used in insulation installation. The CFC-free polyiso 
insulation performs as efficiently as the prior product.
Federal energy management
    The federal government spends over $3.0 billion annually to light, 
heat, and cool the interior of buildings it owns and operates. These 
facilities, like those occupied by private industry, often can be 
economically upgraded and retrofitted to reduce the energy required to 
provide essential building energy services. The Federal Energy 
Management Program (FEMP) utilizes energy saver performance contracts 
for all federal agencies to maximize cost savings and federal 
purchasing power. These contracts enable facilities to take advantage 
of all life-cycle, cost effective energy efficiency and alternative 
fuel technologies. Consequently, DOE works cooperatively with several 
BCSE members, including: the American Gas Association (head-quartered 
in Virginia), the Solar Energy Industries Association (headquartered in 
Washington, DC), the Alliance to Save Energy (headquartered in 
Washington, DC) and the Gas Research Institute (headquartered in 
Illinois).
                              v. conclusion
    DOE's energy efficiency activities reflect the broad diversity of 
the technologies and services that characterize the energy efficiency 
industry. The federal government has a long history of supporting 
energy efficiency programs based on the many societal benefits offered 
by these programs. DOE's programs are directed at mitigating market 
distortions and are consistent with sound market theory. For these 
reasons the BCSE urges Congress to continue its support for these 
efforts.
                                 ______
                                 

   Prepared Statement of the American Association of Retired Persons

    AARP appreciates this opportunity to comment on appropriations for 
the Weatherization Assistance Program. This program helps low income 
households reduce energy costs by funding such activities as installing 
weather-stripping, storm windows and insulation. Energy costs are a 
burden on low income families, often forcing such households to make 
difficult choices among basic necessities. This is especially true 
regarding the elderly, given their increased risk of fatality from 
freezing or heat stroke. Older persons also tend to live in older, less 
well-insulated homes. The bitter winter that swept across so much of 
the nation this year brought suffering to many elderly and working-poor 
families who had no choice but to remain in their drafty, dilapidated 
housing.
    AARP supports the Administration's proposed increase (from $120.8 
million to $154. 1 million). These Department of Energy grants serve as 
the core program to leverage utility and housing resources for 
weatherization activities. Currently, the program is weatherizing 
approximately 61,000 homes; the budget request would increase this to 
77,000 next year. More than 27 million homes remain eligible for such 
assistance. The Department of Energy reports that, to date, its 
weatherization program working in cooperation with Federal and State 
partners has increased the energy efficiency of over 4.6 million homes.
    Data from the Department of Energy's 1993 Residential Energy 
Consumption Survey indicate that low income households spend 
approximately 14 percent of their income on home energy, about three-
and-a-half times the percentage paid by the typical American household. 
The survey further indicates that energy expenditures as a percent of 
income for older households are about 50 percent higher than for the 
general population.
    The Residential Energy Consumption Survey also indicates that 35 
percent of the homes occupied by older households were built prior to 
1950, compared to only 26 percent of those occupied by younger 
families. These homes are typically less well insulated, more expensive 
to heat and in need of repair. Research by AARP's Public Policy 
Institute using data from the 1993 American Housing Survey shows that 
older households, especially minority older households, are more likely 
to occupy substandard housing. For example, among owner-occupied units, 
homes of older African-American households were almost four times more 
likely to exhibit severe or moderate quality defects. The 1993 American 
Housing Survey indicates that 64 percent of low income older owners did 
not devote any funds to routine maintenance or improvements such as 
weatherization.
    Weatherization Assistance has made a crucial difference for many of 
these older households. Just over one-third of the dwellings 
weatherized under the program are occupied by older persons. The most 
recent full-scale evaluation of the Weatherization Assistance Program, 
a study by the Oak Ridge National Laboratory released in January, 1997 
indicates that Weatherization efforts through the Weatherization 
Assistance Program have reduced home energy heating expenditures by an 
average of 18 to 24 percent for households utilizing natural gas as 
their primary heating source. When combined with Low Income Home Energy 
Assistance benefits, the home energy cost burden is reduced further.
    Emphasis in the Weatherization Assistance Program with respect to 
methods used has evolved from emergency and temporary measures (such as 
caulking and weather-stripping) to inclusion of those conservation 
remedies that on average produce the highest savings (e.g., combined 
attic and sidewall insulation). Personnel in the field are now much 
more experienced in determining which conservation techniques, under 
what circumstances, are most cost effective and save the most energy.
    A particularly promising area for improvement in energy efficiency 
is in manufactured housing. Manufactured homes, more commonly referred 
to as mobile homes, are a major source of housing for low-income and 
elderly households. Although the Department of Housing and Urban 
Development adopted improved energy efficiency standards for new 
manufactured homes in 1994, the large stock of existing manufactured 
homes is not energy efficient. Households living in manufactured homes 
spend on average twice as much for energy per square foot of living 
space as do households living in single-family homes. Homes 
manufactured before 1975, representing 44 percent of the existing 
stock, are even less energy efficient.
    Currently, approximately 20 percent of all Weatherization work 
focuses on manufactured housing. Recent reports by the National Center 
for Appropriate Technology (NCAT) indicate that new Weatherization 
techniques for pre-1976 manufactured housing can reduce energy bills by 
30 to 50 percent. These techniques are now being made available by NCAT 
to Weatherization agencies across the nation. The combination of 
improved weatherization techniques and tougher energy efficiency 
standards for new manufactured homes promises major improvements in 
energy efficiency for this form of housing and substantial benefits for 
low income residents.
    DOE's supporting analysis for the 1990 National Energy Strategy 
indicated that long-term residential energy consumption could be 
reduced by 23 percent through a gradual introduction of the best 
available conservation technology. The analysis also noted that to make 
a major contribution in the short-term, conservation measures must 
focus on retrofitting existing buildings. In addition, the National 
Energy Policy Act of 1992 gives great emphasis to improving building 
efficiency. With a capability to weatherize approximately 250,000 
dwellings a year, continuation of the Weatherization Assistance Program 
is essential to meeting national energy goals.
    Thank you for this opportunity to comment on funding next year for 
this critical program.
                                 ______
                                 
 Letter from D. James G. Speight, chief executive officer, the Western 
                           Research Institute
                                        Laramie, WY, April 8, 1997.
Hon. Slade Gorton,
Chairman, Subcommittee on Interior, Committee on Appropriations,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: On behalf of the Western Research Institute 
(WRI), I request that the following statement be submitted as part of 
the record of proceedings for the Subcommittee on Interior's 
consideration of the Department of Energy's Office of Fossil Energy 
research and development fiscal year 1998 budget request. Specifically, 
WRI requests the Subcommittee's support of the Cooperative Research 
Program and to provide at least $6,000,000 of which we request $3 
million to support ongoing or planned cooperative research projects at 
WRI. These projects require at least fifty percent industrial cost-
sharing. WRI has sought to implement a cooperative research program 
that is consistent with congressional intent to maximize industry 
involvement in research, development and demonstration projects. The 
following discussion reviews the accomplishments of the Cooperative 
Research Program at WRI and our expectations for fiscal year 1998.
    WRI wishes to take the opportunity to support the Of flee of Fossil 
Energy's budget request in general. We do, however, have a concern over 
the new and unprecedented orientation in the budget request allocation 
of budget resources for the Cooperative Research Program. Specifically, 
WRI believes that in the past the even handed approach to funding 
allocations within this program has benefited the Department of Energy, 
provided necessary assurances to industry partners on the program's 
viability and met congressional intent to ensure that cost-shared 
research and technology development projects within this program can 
continue unencumbered by unrelated priorities. Therefore, WRI strongly 
encourages the Subcommittee to ensure consistency and equal treatment 
in funding allocation decisions and to ensure that WRI is able to 
participate at such levels consistent with Department of Energy and 
industry priorities.
   successful leveraging of federal funding with private cost-sharing
    The Jointly Sponsored Research (JSR) Program emphasizes technology 
commercialization and continues to be highly successful and supported 
strongly and enthusiastically by WRI's industrial clientele. All of the 
available Department of Energy (USDOE) funding for each of the first 
seven years has been committed to projects.
    Since entering into a new JSRP cooperative agreement with the 
Department of Energy on March 26, 1993, WRI has put in place projects 
utilizing a total of $10,986,264 in USDOE funds. These funds have been 
combined with $14,586,209 in industrial funds to produce a $25,572,473 
program. The use of fiscal year 1997 funds will produce a program 
valued at or above $30 million while using less then $13 million in 
USDOE funds.
    While it is always desirable to acquire an asset worth more than 
$30 million for a price less than $13 million, these numbers 
substantially understate the true value of the program. What price does 
one put on the value of new technology which improves regional 
economies and enhances our quality of life? As this report illustrates, 
the technology developed during the past four years not only results in 
billions of dollars of increased or enhanced energy reserves, but a 
cleaner, healthier and safer environment as well. This means a safer 
and more secure energy and environmental future for us, our families 
and for future generations.
                   technology meeting national needs
    The Cooperative Agreement Program emphasizes technology 
commercialization consistent with the USDOE's mission to enhance the 
nation's energy security through increased efficiencies in exploration, 
production and utilization with minimal or no adverse environmental 
consequences. Technologies emerging from the program are consistent 
with this goal and include:
                         clean fuels from coal
    Thermo Ecotek announced in August 1995 the signing of an agreement 
to construct a 500,000 tons per year coal upgrading plant in the Powder 
River Basin of Wyoming. The plant cost $42 million and uses the 
Koppelman Series C Process. This process was successfully demonstrated 
by WRI and KFx Inc. in early 1994 using a pilot plant funded by 
matching funds from the USDOE JSR Program. WRI is presently working 
with KFx Inc. on projects to increase the throughput and reduce the 
cost of second generation plants which will use the improved version of 
the Koppelman Series C Process and to test foreign coals as feedstocks 
for the process.
                  increased production of domestic oil
    Present above ground steaming technology is limited to depths of 
1,800 to 2,500 feet due to large heat losses as depth is increased. 
Heat loss does not exist with the Meshekow electric downhole steam 
generator (EDSG) since steam is being produced directly at the 
formation zones. It is estimated that the U.S. has 42 billion barrels 
of heavy crude at depths between 3,000 and 5,000 feet. The high 
operating efficiencies of the EDSG will allow these formerly 
unexploitable reserves to be recovered.
    The EDSG has significant applications for deep reservoirs under 
layers of permafrost as are found in regions like Alaska's West Sak and 
Kuparuk oil fields. Alaska's fields are estimated to contain 25 billion 
barrels of proven heavy oil reserves, the majority of which are deeper 
than 3,000 feet and lie under thick layers of permafrost. Because of 
the depth and permafrost conditions, conventional above ground steam 
generation is impractical if not impossible and the EDSG may represent 
the only technology capable of recovering this oil.
      reduced environmental impact associated with oil production
    Tank bottom wastes from petroleum production are estimated to 
exceed 27,000,000 barrels in the U.S. alone with an accumulation rate 
of 2,800,000 barrels per year. RCRA regulations currently allow storage 
in permitted pits or tanks but fewer and fewer permits are being 
approved. WRI developed and patented the Tank Bottom Recovery and 
Remediation (TaBoRR) process to address this problem. The method 
results in separation of water, a light hydrocarbon stream, a heavy 
hydrocarbon stream, and an inert, non-leaching, liquid-free solid. The 
process is currently undergoing testing in a 300 barrel per day process 
development unit and negotiations are underway with a number of 
domestic and international companies for extended testing and 
deployment within operating fields.
             remediation of hydrocarbon-contaminated sites
    Thousands of sites in the US have subsurface hydrocarbon 
contamination and many are contaminated with heavy oils. WRI developed 
the CROW process to mitigate such sites. JSR funding has enabled field 
demonstrations of the technology at the Bell Lumber site in New 
Brighton, Minnesota and the Pennsylvania Power and Light site in 
Stroudsburg, Pennsylvania. Installation and shakedown of all field 
equipment at both sites are complete. The PPL system has been fully 
operational for more than six months and has produced more than 1500 
gallons of DNAPL. The owner estimates that the CROW process has reduced 
the cost of remediation by more than $1.3 million.
                    improved environmental monitors
    The determination or screening of environmental contaminants in the 
field using portable analytical methodologies or down-hole real time 
in-situ measurements is an area of great interest in the environmental 
industry. The TROLL (SP4000) which became commercially available in 
fiscal year 1996 is a fully submersible intelligent probe designed for 
monitoring water level and temperature. Using Windows-based software, 
the TROLL can be easily programmed in the office, car or field and 
connected either to a PC, which is used for programming and receiving 
stored data, or to other units via separately-supplied wiring or 
telemetry.
                      increased health and safety
    PEAC is a hand-held computer system that provides first responders 
with fast, easy-to-use information for chemical spills and emergencies. 
The size of an emergency response area often dictates how limited 
resources are allocated. Evacuation distances vary greatly with spill 
and weather conditions. The ability to determine protective action 
distances using actual conditions is crucial to resource allocation. 
Commercial PEAC units are being produced and sales began in January 
1997.
 solving energy and environmental problems to improve our economy and 
                      enhance our quality of life
    Each of the six technologies being brought to commercialization 
with the funds provided by the current Cooperative Agreement Program 
contributes to the overall goals of the U.S. Department of Energy and 
the Nation. Each has broad applicability both within the United States 
and abroad thereby helping to enhance the competitiveness of U.S. and 
western energy technologies in international markets and assisting in 
technology transfer. The downhole steam generator (EDSG) can 
potentially increase the Nation's heavy oil reserves by more than 40 
billion and perhaps as much 100 billion barrels while the Koppelman 
Series C Process is expected to generate markets for as much as 20 
millions tons annually of low sulfur coal. Both of these technologies 
contribute substantially to the goal of increased production of U.S. 
energy resources and reducing the Nation's dependence upon foreign 
energy supplies. The TaBoRR technology helps to minimize the impact of 
energy production and utilization on the environment while 
simultaneously recovering some additional ten million barrels of usable 
oil. This technology is augmented by the TROLL smart probe, CROW and 
PEAC technologies, all of which contribute measurably and substantially 
to a significantly cleaner, healthier and safer environment. The total 
funding to bring these technologies to this stage of development was 
more than $30 million with the government's share of this being less 
than $13 million. We certainly feel that these funds were well spent in 
``Solving energy and environmental problems to improve our economy and 
enhance our quality of life.''
    America has always been a nation recognized for scientific 
excellence. This excellence has served the nation well in the years 
since its founding and is largely responsible for our country's 
dominant industrial position in the world today. The Cooperative 
Agreement Programs are ideally suited to meet scientific and industrial 
needs in that they carry this concept--which has already been proven to 
be so fundamentally sound--one step further * * *.
    scientific excellence with a commercial purpose a strategy for 
               successfully competing in a global economy
    In a high-technology global economy, technology development is 
crucial to the preservation and growth of the American economy and 
standard-of-living. Much of this technology and growth will come from 
companies which were small or nonexistent just a decade earlier. These 
emerging companies must rely upon creative and innovative Institutes 
such as me Western Research Institute to assist with their process and 
product development activities. It is a tribute to the wisdom and the 
foresight of the United States Department of Energy and the Congress 
that activities such as the Cooperative Agreement Programs exist to 
meet these crucial national needs.
    As we enter the fifth year of our present Cooperative Agreements, 
we have a sense of pride and accomplishment regarding what has been 
achieved during the first four years of the program. We hope that as 
you read the enclosed materials you shared the same pride and spirit of 
accomplishment that we do. Certainly much has been done and done well. 
Technologies developed at WRI during the past four years will add 
measurably to the Nation's energy reserves while providing a cleaner, 
healthier and safer environment. Yet much still remains to be done!
    Increasingly, the demonstration and commercialization of technology 
require strong, coordinated and focused activities often spanning 
several years. Accordingly we find our industrial partners requiring 
multi-year segments of time and funding. In turn, if meaningful 
projects are to be undertaken and commercialized, there must be some 
assurance of long-term and dependable support. Ensuring that this 
necessary support is available and put to good use in fueling our 
domestic economy is the challenge facing us all. We at the Western 
Research Institute look forward to working with members of the 105th 
Congress to accomplish this extremely important and necessary task.
            Sincerely yours,
                               D. James G. Speight,
                                   Chief Executive Officer,
                                        Western Research Institute.
                                 ______
                                 

  Prepared Statement of Judith L. Mondre, Executive Director, City of 
  Philadelphia Energy Office and Chair, Urban Consortium Energy Task 
                                 Force

    This testimony is submitted for the information of the Subcommittee 
in connection with the Department of Energy's (DOE) budget requests for 
fiscal year 1998. The Urban Consortium Energy Task Force (UCETF) 
appreciates this opportunity to report to the Subcommittee regarding 
its participation in DOE's Municipal Energy Management Program.
    The UCETF is made up of local government energy policymakers and 
administrators from major urban areas around the United States. 
Currently, 22 jurisdictions are represented on the UCETF: Albuquerque, 
NM; Austin, TX; Chicago, IL; Columbus, OH; Dade County, FL; Denver, CO; 
Greensboro, NC; Hennepin County, MN; Kansas City, MO; Long Beach, CA; 
Memphis, TN; Monroe County, NY; Montgomery County, MD; Orange County, 
FL; Philadelphia, PA; Phoenix, AZ; Portland, OR; San Diego, CA; San 
Francisco, CA; San Jose, CA; Seattle, WA; and Washington, D.C. The 
UCETF is a subgroup of the Urban Consortium, an organization of the 
nation's largest cities and counties joined together to identify, 
develop and deploy innovative approaches and technological solutions to 
shared urban concerns. The Urban Consortium is a program of Public 
Technology, Inc. (PTI), which is the non-profit technology organization 
of the National League of Cities, the National Association of Counties, 
and the International City/County Management Association.
    With funding provided by the Department of Energy, Municipal Energy 
Management Program, the UCETF annually conducts a program of innovative 
energy technology development, application and replication projects. 
All projects are conducted by local government staff, in furtherance of 
the UCETF's objective of improving the energy management capabilities 
of local governments. Participation in the annual work program is open 
to larger urban jurisdictions around the United States. Projects are 
competitively selected based on merit for two categories of funding: 
energy project funding and technology transfer project funding. All 
programs must demonstrate strong partnerships, which in many cases 
include cost-sharing, from the private sector and other government 
agencies. In addition, the annual work program features a variety of 
technology transfer and solution deployment activities designed to 
widely disseminate the knowledge gained through the performance of 
local government energy projects to jurisdictions of all sizes 
throughout the United States.
          the ucetf responds to local government energy needs
    Meeting local government responsibilities in times of ever 
shrinking resources demands creative and innovative solutions. Larger 
urban governments in particular have found means to utilize energy 
policy and programs as a tool to help reduce the cost of government and 
stimulate the local economy, thereby producing more revenues that can 
be used to deliver priority services to local populations.
    The ability of local governments to respond to new challenges and 
make prudent policy choices in the energy area for the benefit of local 
citizens is directly enhanced through the UCETF program. The program 
responds to needs identified by local governments for specific support 
in addressing and resolving local energy issues. Through the program's 
emphasis on partnering, Federal funds through the Municipal Energy 
Management Program leverage more private sector dollars to help local 
governments achieve energy goals and respond to the mandates of 
national energy and environmental policies. DOE resources through the 
Municipal Energy Management Program leverage local and private sector 
in-kind and cost-sharing contributions, typically on as much as a 4:1 
basis. The return on the Federal government's investment is measured in 
reduced energy consumption, cost savings and environmental improvement 
in local areas.
    Some UCETF-funded projects have a technology focus, some address 
longer term and institutional issues, and some are policy oriented. The 
UCETF program is successful because it is able to address all of these 
areas.
    Through its focus on annual work programs, the UCETF is in a 
position to respond to changing emphases and issues in the energy 
field. As an example, significant attention in the 1996-1997 program is 
being devoted to issues involved in the introduction of increased 
competition in the electricity industry. This issue has the potential 
to significantly influence--for better or for worse--all local 
governments. But because of the breadth and complexity of the issues 
involved, many local governments are ill-prepared to deal with the 
demands of the changing marketplace. Through research projects in 
jurisdictions around the nation, and technology transfer activities, 
the UCETF seeks to become a leading national resource for municipal 
governments on approaches to, and the implications for local 
governments of, coming changes in the structure of the electricity 
industry.
    The UCETF maintains its traditional focus on application of 
technologies to increase the efficiency of energy use, and identify new 
sources of energy supply, in municipal governments. The UCETF has also 
been among the pioneers in advancing the concept of ``sustainability,'' 
and the Task Force continues to focus on projects that make the linkage 
between energy, environmental and economic imperatives in local 
communities. An objective of the UCETF is to provide concrete examples 
to be followed by other local governments on how to integrate energy 
considerations into other policy disciplines in a way that supports 
local needs.
              the ucetf's 1996-1997 applied energy program
    Through the current UCETF program, jurisdictions are conducting 
specific energy technology development/application or technology 
transfer projects addressing locally-identified priorities in the 
following areas:
    Municipal Governments and Utility Policy.--Local governments are 
extremely interested in, and in need of reliable information on, the 
local impacts of the restructuring of the electricity industry. Local 
governments will be affected by the move toward greater competition in 
electricity in a number of ways. Competition offers the opportunity for 
cost savings through reduced energy bills for local government, 
businesses and residents. Open access to transmission systems, and 
wholesale and retail wheeling will affect those local jurisdictions 
that currently offer exclusive utility franchises. Franchise fees, or 
other revenues received by local jurisdictions from utilities, may be 
affected by changes in the industry. Opportunities for greater economic 
growth may be enhanced by lower electricity rates. But with lower rates 
come pressures on utilities to discontinue activities in a number of 
areas, including energy efficiency programs, low income efforts and 
research and development, that local governments have traditionally 
valued. The UCETF is conducting five projects focusing on local aspects 
of the restructuring issue. San Jose, CA is examining the impacts of 
utility restructuring on municipal revenues, utility costs and energy 
management. Chicago is investigating the potential role of local 
government (as consumer, regulator, generator, and possibly aggregator/
marketer of electricity) in bringing competitive electricity service to 
industrial sites. Columbus, OH, which is interested in offering retail 
electricity wheeling on its municipal grid, is conducting a case study 
for developing local distribution rates. Portland, OR is developing a 
``GreenPower Partnership'' to offer Portland businesses the opportunity 
to buy electricity generated by non-hydro renewable resources such as 
wind, geothermal or solar. Barnstable County, MA, a leader in 
addressing how competitive franchises may be used in a deregulated 
electricity industry, is working to transfer the results of its 
research among local governments around the nation.
    Energy Usage and Supply.--Local governments face continuing 
requirements to cut energy usage and costs, and opportunities to apply 
new technologies expressly suited to local climatic conditions and 
utilizing local energy resources. Phoenix is investigating waste 
minimization and digester gas utilization at a large wastewater 
treatment plant. Yolo County, CA is monitoring an already constructed 
project to evaluate the technology and develop guidelines for 
application of technology to accelerate the rate of generation and 
capture of methane in landfills. Cabo Rojo/Mayaguez, Puerto Rico is 
addressing the use of solar assisted air conditioning and 
dehumidification systems to offset demand for electricity in 
subtropical climates. Chittenden County, VT is working to expand the 
opportunity for biomass district energy systems.
    Energy Efficiency for Local Needs/Economic Development.--Energy 
efficiency activities can contribute to creation of a sustainable urban 
environment. Urban governments also have important roles to play in 
bringing energy efficiency technologies and techniques into the 
marketplace. Urban areas are well positioned to serve as testbeds for 
such technologies, as part of an overall effort to increase energy 
efficiency. The UCETF continues to focus on projects that make the 
linkage between energy, environmental and economic concerns in local 
communities. San Francisco is conducting a project to aggregate the 
small business marketplace for energy efficiency improvements, in order 
to provide a mechanism for energy service providers to penetrate this 
important market. Albuquerque is developing guidelines for reduction in 
both water and energy use, including integrating new technologies into 
computer controls for water distribution in parks. Honolulu is 
documenting the appropriate role for electric vehicles in municipal 
government fleets. Hennepin County, MN is undertaking an innovative 
effort to combine telework centers with job training and retraining 
centers. Memphis is working to centralize monitoring and control of 
HVAC equipment by electronically linking city buildings through a 
building automation network.
    Technology Transfer.--The UCETF is conducting five projects 
specifically designed to document and transfer lessons learned through 
local government energy programs. Chula Vista, CA is documenting the 
results of its telecenter project to provide guidance on how to make 
telecenters work more effectively. San Francisco is developing a boiler 
maintenance manual including proven strategies for comprehensively 
maintaining and cost effectively improving the efficiency of existing 
municipal boilers. With UCETF support, Dade County, FL is conducting a 
conference to address sustainability and energy efficiency. Montgomery 
County, MD is developing a CD-ROM version of the Energy Design 
Guidelines, to provide an easily used and widely transferrable package 
for energy efficient building design. Tucson, AZ is documenting the 
barriers to straw bale construction for affordable, energy efficient 
housing.
    In addition to these specific technology transfer projects, the 
UCETF program features peer to peer exchange and dialogue on a variety 
of issues, and is concentrating in particular on effectively 
documenting products available for transfer from prior year programs. 
Specific efforts are underway in several areas to conduct direct 
transfer activities to widely share the benefits of Federally-supported 
energy technology development and application programs. A special focus 
in the current program has been on electricity restructuring. The UCETF 
published and distributed widely a primer, ``Keeping the Lights On'' 
and supporting Resource Guide intended to introduce municipal 
governments around the nation to the issues in, and implications of, 
changes in the electricity industry.
                               conclusion
    Through the Municipal Energy Management Program, local governments 
can be a component of the national effort to maintain the United States 
as the world's leader in developing, applying and exporting 
sustainable, environmentally benign and economically competitive energy 
technologies. The UCETF program enhances the ability of local 
governments to identify, design and implement energy policies that 
support local economic objectives, including jobs growth and retention. 
The program offers the nation a proven successful method to identify 
ways that energy technologies can be applied to aid in addressing 
community issues; to share information among local governments, and to 
prepare local officials to respond to the energy and energy-related 
environmental issues in their own communities.
                                 ______
                                 

 Prepared Statement of the Natural Gas Industry Research, Development 
                      and Demonstration Initiative

                            i. introduction
    Mr. Chairman and Members of the Subcommittee:
    The Natural Gas Industry's Research, Development & Demonstration 
(RD&D) Initiative is a group comprising the American Gas Association's 
300 member companies, producers, pipelines, along with research and 
trade organizations, formed in 1989, specifically to promote 
accelerated natural gas technology development.
    The Initiative has engaged in a year-long process to identify those 
areas and technologies of greatest importance to the natural gas 
industry and the U.S. economy and environment. The Initiative supports 
the Department of Energy's (DOE) overall fiscal year 1998 request, but 
specifically seeks $7.7 million above the Administration's request in 
the following research areas: natural gas vehicle (NGV) on-board 
storage, NGV medium-and heavy-duty engine development, NGV fueling 
infrastructure, natural gas cooling/desiccants (dehumidification) 
systems, natural gas-fired engine driven systems (emission reduction 
research), and the industrial combustion program.
                        ii. natural gas vehicles
    Congress approved, in fiscal year 1997, the development of a five-
year R&D plan for natural gas vehicles. This plan, which is being 
developed jointly by DOE, the natural gas industry, and the University 
of West Virginia, will help DOE identify future program needs. Results 
from a workshop attended by 48 technologists from all parts of the 
industry were not available to DOE in time for the fiscal year 1998 
budget request, but will be used for future budgets. Although DOE has 
responded to the industry's emphasis on ``high fuel-use'' medium-and 
heavy-duty fleet vehicles, the Initiative has additional 
recommendations to Congress to match the priorities of the 5-year plan. 
The Initiative seeks $4 million above DOE's request for fiscal year 
1998. The priorities are: (1) on-board storage/smart fuel systems, (2) 
heavy-duty engine development and (3) fueling infrastructure R&D.
    One of the major obstacles for natural gas vehicles (NGV) remains 
on-board storage systems for compressed natural gas (CNG) and liquefied 
natural gas (LNG) fuels. Improvements are needed in CNG and LNG fuel 
system inspection techniques, LNG fuel tank structural integrity, fuel 
storage integration, and lower cost materials such as high strength 
steels and composite materials for CNG storage. The Initiative proposes 
an increase of $1.5 million above DOE's fiscal year 1998 request for 
these programs.
    Heavy-duty engines are predominantly compression ignition (diesel) 
because they have higher potential energy efficiency than spark 
ignition (gasoline) engines. Natural gas does not lend itself readily 
to the compression ignition cycle; but, past research has shown 
potential in utilizing prechamber dual-fuel (natural gas/diesel pilot 
injection) and lean-burn natural gas prechamber (spark ignition) 
technology in accomplishing reduced exhaust emissions. To develop 
natural gas engine technologies which avoid knock and achieve power and 
torque levels comparable to the highest-rated diesels, further research 
and development of direct-injection natural gas engines should be 
pursued. The Initiative requests $1 million above DOE's fiscal year 
1998 request to be divided between spark and compression ignition 
cycles.
    Lower-cost refueling technology remains critical to the healthy 
development of the NGV industry. Cryogenic fuel metering and fuel 
supply components are essential to ensure that current and future 
equipment will be the safest and most cost-effective available. Since 
this is a priority in the 5-year plan, the Initiative requests an 
additional $1.5 million above DOE's fiscal year 1998 request to begin 
this research.
                        iii. natural gas cooling
    Natural gas cooling is extremely energy efficient, especially when 
measured on a life-cycle basis (measuring energy from its source 
through transmission and distribution to the site), and its low-
emission properties make it environmentally friendly. Additionally, 
natural gas cooling is used during the hours of the day and days of the 
year that correspond to the peak demand for electricity generating 
capacity, thereby benefiting gas customers and gas and electricity 
providers. DOE's funding for gas cooling programs continue to remain 
modest despite strong interest and cost-sharing from industry. The 
Initiative seeks an appropriation $10.25 million in fiscal year 1998 
for natural gas cooling, or $1.7 million above DOE's request.
    The Initiative advocates increased government participation on 
absorption and adsorption technologies. DOE should develop a program 
comparing and contrasting all available GAX technologies, including 
solid sorbtion technologies, with the objective of developing the best 
overall hardware that meets a direct materials and cost labor target of 
$500 per cooling ton at production levels of 1000 units per year 
(comparable to an electric heat pump). In parallel, DOE should 
undertake a cost-reduction program with industry partners to improve 
the GAX absorber, solution pump and air coil designs.
    Desiccant dehumidification systems for heating and cooling are 
poised to make a substantial impact on the marketplace and the 
environment. Although test procedures for the first desiccant products 
on the market have been developed in conjunction with public/private 
partnerships and support, further rating system work remains. Liquid 
desiccants can be configured in split systems to offer potential for 
significant sensible cooling in addition to latent cooling 
capabilities. Other potential areas of research include coupling engine 
and desiccant technology for the recovery of waste heat; advanced 
controls integration; and education, and training programs. The 
Initiative seeks $700,000 above DOE's fiscal year 1998 request for 
these activities.
    Finally, the Initiative again urges DOE to work with industry on 
reduction of emissions from gas-fired engine driven systems, 
particularly large commercial systems that are beginning to penetrate 
the HVAC market. These systems require pollutant emissions reduction in 
anticipation of future regulatory requirements. The Initiative seeks $1 
million for these activities.
                       iv. residential appliances
    With over 53 million customers and five quadrillion Btus (quads) of 
annual gas usage in 1995, the residential gas market is an important 
segment of the nation's population and energy use. Residential gas 
demand is about one-half of total residential energy consumption and 
almost a quarter of total U.S. natural gas use. The number of 
residential gas customers is expected to grow by 10-11 million by 2005. 
In 1995, 64 percent of newly constructed homes utilized natural gas. 
The Initiative will be working with DOE in fiscal year 1998 and fiscal 
year 1999 to expand research in the areas of space heating, (burners 
and heat exchangers), combination systems and appliance interface 
modules (metering systems).
                         v. industrial systems
    The natural gas industry supports DOE's mission to improve the 
global competitive position of U.S. industry. We encourage DOE to help 
develop new technologies needed in the next century by our key 
industrial sectors. These sectors include the seven ``vision'' areas 
identified by the Office of Industrial Technology. The Initiative's 
members are currently supporting the development of new and innovative 
technologies in cooperation with these industries, particularly in the 
areas of glass and steel. In the steel market, R&D is needed on rapid 
strip heating, billet preheating and steel reheating. In the flat glass 
market, R&D is needed to develop a glass heating furnace to reduce 
emissions and to improve productivity and oxygen-enriched air staging 
to provide lower operating costs and lower NOX emissions.
    The metal casting vision also offers significant opportunities for 
natural gas research. Innovative technologies and materials development 
can raise the temperature limits of gas-fired heat treating furnaces, 
reduce operating costs, improve productivity and parts quality, and 
reduce emissions and fuel consumption.
    Finally, the Initiative recommends the restoration of funding ($2 
million) in fiscal year 1998 to continue important basic research in 
the areas of combustion systems and controls, with specific emphasis on 
the automation of industrial processes. In fiscal year 1997 DOE 
requested and received $2 million for these important cross-cutting 
activities.
                            vi. gas turbines
    The Energy Information Agency's (EIA) 1996 Energy Outlook and the 
GRI Baseline Projection of U.S. Energy Supply and Demand (1996 
Edition), both project that total gas demand for electricity generation 
is projected to grow from 4.3 quads in 1994 to over eight quads in 
2015. The portion of this gas demand in industrial and commercial 
cogeneration is projected to more than double, from 1.1 quads in 1994 
to 2.7 quads in 2015. Growth in gas-fired cogeneration capacity is 
strongly impacted by the move toward a more competitive electric 
market. Low operating and capital costs and increased-efficiency 
systems are the key to this market.
    The Initiative strongly supports full funding for DOE's Advanced 
Turbine Systems Program, particularly the industrial-size gas turbine 
system. Research will be geared toward reducing NOX 
emissions at the higher temperatures (required to increase system 
efficiency) without increasing emissions of CO or unburned 
hydrocarbons. The critical research issues include: system efficiency, 
emissions, and materials development and performance demonstrations.
                            vii. fuel cells
    The Initiative places a very high priority on DOE's Office of 
Fossil Energy's entire Stationary Fuel Cell program. Additionally, the 
Initiative supports DOE's Office of Energy Efficiency's Building Sector 
Micro-generation program. Fuel cell power systems are poised to enter 
the market for dispersed power generation and will be available in the 
future in a variety of sizes and types to fill the diverse power 
generating needs of the commercial, industrial and utility sectors. 
Fuel cells are very efficient energy converters. Compared to the 
average 35 percent efficiency of the present electrical grid, the 
projected fuel-to-electric conversion efficiency for fuel cell power 
plants range from 45 percent, for the units about to enter the market, 
to 70 percent for units that could become available by 2010. The ultra-
low emissions and good-neighbor features of fuel cells enable them to 
be sited close to the end users, eliminating losses associated with 
long-distance transport over high-voltage lines. The ultra-low 
emissions include virtually zero NOX and SO2 
levels, and the lowest CO2 emissions of any fossil fuel 
power plant. The worldwide market for fuel cells is projected to be $3 
billion dollars per year in the post-2000 era with an exponential 
growth in the market after 2010.
    The Initiative supports DOE's efforts to integrate fuel cells into 
commercial building applications. Applications in the building sector 
represent a large market for fuel cells and a significant opportunity 
for increased energy efficiency. The combination of electricity and 
heat generation give these market entry units an overall energy 
efficiency of 85 percent and make them an excellent candidate for 
commercial building sector applications.
                        viii. natural gas supply
    The GRI Baseline Projection of U.S. Energy Supply and Demand, 1977 
Edition, of U.S. domestic natural gas production shows a potential 
increase from 19 quads in 1995 to 27.3 quads by 2015, an increase of 
over 40 percent. By the year 2015, about 40 percent of U.S. gas supply 
will depend on the availability of new technology. There have been 
significant environmental benefits to the nation from greater gas use 
in our energy mix. The Initiative supports DOE's natural gas supply 
request. For gas supply to continue to grow, at low and stable prices, 
new and improved technology advances will be needed to reduce 
exploration and production costs and increase recovery per unit of 
activity.
    DOE should concentrate on working with industry to develop and 
demonstrate a set of tools that result in a minimum of formation damage 
during the drilling, reduce the cost and improve the efficiency of gas 
recovery from mature fields, and minimize overall environmental 
impacts.
    Federal assistance is also needed to ensure that new regulations 
can be met adequately, consistently and at the lowest possible cost. A 
recent National Petroleum Council study noted that the combination of 
projected requirements of the Clean Air Act Amendments of 1990, the 
Safe Drinking Water Act and other pending federal legislation could, by 
the year 2010, raise overall gas-producing costs by as much as $750 
million per year.
                             ix. conclusion
    U.S. Industries compete in a global economy where our major 
competitors, such as Japan, Great Britain and Germany, provide 
substantial assistance in RD&D and commercialization activities. 
Natural gas technologies can provide substantial benefits to the nation 
through cleaner air, job creation, energy efficiency, energy security 
and increased competitiveness in the world marketplace.
    Thank you for the opportunity to present our views.
                                 ______
                                 

           Prepared Statement of the American Gas Association

                            i. introduction
    Mr. Chairman and Members of the Subcommittee: The American Gas 
Association (A.G.A.) is a trade association representing over 200 local 
natural gas distribution companies (LDCs) in the United States, which 
together distribute more than 90 percent of the natural gas delivered 
in this country.
    The A.G.A. has engaged in a year-long process to identify those 
areas and technologies of greatest importance to the natural gas 
industry and the U.S. economy and environment. The A.G.A. supports the 
Department of Energy's (DOE) overall fiscal year 1998 request, but 
specifically seeks $7.7 million above the Administration's request in 
the following research areas: natural gas vehicle (NGV) on-board 
storage, NGV medium-and heavy-duty engine development, NGV fueling 
infrastructure, natural gas cooling/desiccants (dehumidification) 
systems, natural gas-fired engine driven systems (emission reduction 
research), and the industrial combustion program.
    A.G.A. continues to maintain concern that DOE's Home Energy Rating 
System (HERS) program does not measure energy efficiency on a life-
cycle basis (measuring energy from its source through distribution to 
the site.) Nonetheless, A.G.A. supports the fiscal year 1998 request of 
$1.5 million to be used only to continue existing state pilot programs. 
Also, A.G.A. is supportive of DOE's Weatherization Assistance Program 
and is working with the states toward making homes more energy 
efficient.
                        ii. natural gas vehicles
    Congress approved, in fiscal year 1997, the development of a five-
year R&D plan for natural gas vehicles. This plan, which is being 
developed jointly by DOE, the natural gas industry and the University 
of West Virginia, will help DOE identify future program needs. Results 
from a workshop attended by 48 technologists from all parts of the 
industry were not available to DOE in time for the fiscal year 1998 
budget request, but will be used for future budgets. Although DOE has 
responded to the industry's emphasis on ``high fuel-use'' medium-and 
heavy-duty fleet vehicles, A.G.A. has additional recommendations to 
Congress to match the priorities of the 5-year plan. A.G.A. seeks $4 
million above DOE's request for fiscal year 1998. The priorities are 1) 
on-board storage/smart fuel systems, 2) heavy-duty engine development, 
and 3) fueling infrastructure R&D.
    One of the major obstacles for natural gas vehicles (NGV) remains 
on-board storage systems for compressed natural gas (CNG) and liquefied 
natural gas (LNG) fuels. Improvements are needed in CNG and LNG fuel 
system inspection techniques, LNG fuel tank structural integrity, fuel 
storage integration, and lower cost material such as high strength 
steels and composite materials for CNG storage. A.G.A. proposes an 
increase of $1.5 million above DOE's fiscal year 1998 request for these 
programs.
    Heavy duty engines are predominantly compression ignition (diesel) 
because they have higher potential energy efficiency than spark 
ignition (gasoline) engines. Natural gas does not lend itself readily 
to the compression ignition cycle; but, past research has shown 
potential in utilizing prechamber dual-fuel (natural gas/diesel pilot 
injection) and lean-burn natural gas prechamber (spark ignition) 
technology in accomplishing reduced exhaust emissions. To develop 
natural gas engine technologies which avoid knock and achieve power and 
torque levels comparable to the highest-rated diesels, further research 
and development of direct-injection natural gas engines should be 
pursued. A.G.A. requests $1 million above DOE's fiscal year 1998 
request to be divided between spark and compression ignition cycles.
    Lower-cost refueling technology remains critical to the healthy 
development of the NGV industry. Cryogenic fuel metering and fuel 
supply components are essential to ensure that current and future 
equipment will be the safest and most cost-effective available. Since 
this is a priority in the 5-year plan, the Initiative requests an 
additional $1.5 million above DOE's fiscal year 1998 request to begin 
this research.
                        iii. natural gas cooling
    Natural gas cooling is extremely energy efficient, especially when 
measured on a life-cycle basis (measuring energy from its source 
through transmission and distribution to the site), and its low-
emission properties make it environmentally friendly. Additionally, 
natural gas cooling is used during the hours of the day and days of the 
year that correspond to the peak demand for electricity generating 
capacity, thereby benefiting gas customers and gas and electricity 
providers. DOE's funding for gas cooling programs continue to remain 
modest despite strong interest and cost-sharing from industry. A.G.A. 
seeks an appropriation $10.25 million in fiscal year 1998 for natural 
gas cooling, or $1.7 million above DOE's request.
    A.G.A. advocates increased government participation on absorption 
and adsorption technologies. DOE should develop a program comparing and 
contrasting all available GAX technologies, including solid sorption 
technologies, to develop the best overall hardware that meets a direct 
materials and cost labor target of $500 per cooling ton at production 
levels of 1000 units per year (comparable to an electric heat pump). In 
parallel, DOE should undertake a cost-reduction program with industry 
partners to improve the GAX absorber, solution pump and air coil 
designs.
    Desiccant dehumidification systems for heating and cooling are 
poised to make a substantial impact on the marketplace and the 
environment. Although test procedures for the first desiccant products 
on the market have been developed in conjunction with public/private 
partnerships and support, further rating system work remains. Liquid 
desiccants can be configured in split systems to offer potential for 
significant sensible cooling in addition to latent cooling 
capabilities. Other potential areas of research include coupling engine 
and desiccant technology for the recovery of waste heat; advanced 
controls integration; and education, and training programs. A.G.A. 
seeks $700,000 above DOE's fiscal year 1998 request for these 
activities.
    Finally, A.G.A. again urges DOE to work with industry on reduction 
of emissions from gas-fired engine driven systems, particularly large 
commercial systems that are beginning to penetrate the HVAC market. 
These systems require pollutant emissions reduction in anticipation of 
future regulatory requirements. A.G.A. seeks $1 million for these 
activities.
                       iv. residential appliances
    With over 53 million customers and five quadrillion Btu's (quads) 
of annual gas usage in 1995, the residential gas market is an important 
segment of the nation's population and energy use. Residential gas 
demand is about one-half of total residential energy consumption and 
almost a quarter of total U.S. natural gas use. The number of 
residential gas customers is expected to grow by 10-11 million by 2005. 
In 1995, 64 percent of newly constructed homes utilized natural gas. 
A.G.A. will be working with DOE in fiscal year 1998 and fiscal year 
1999 to expand research in the areas of space heating (burners and heat 
exchangers), combination systems and appliance interface modules.
                         v. industrial systems
    The natural gas industry supports DOE's mission to improve the 
global competitive position of U.S. industry. We encourage DOE to help 
develop new technologies needed in the next century by our key 
industrial sectors. These sectors include the seven ``vision'' areas 
identified by the Office of Industrial Technology. A.G.A.'s members and 
associated commercialization center are currently supporting the 
development of new and innovative technologies in cooperation with 
these industries, particularly in the areas of glass and steel. In the 
steel market, R&D is needed on rapid strip heating, billet preheating 
and steel reheating. In the flat glass market, R&D is needed to develop 
a glass heating furnace to reduce emissions and to improve productivity 
and oxygen-enriched air staging to provide lower operating costs and 
lower NOX emissions.
    The metal casting vision also offers significant opportunities for 
natural gas research. Innovative technologies and materials development 
can raise the temperature limits of gas-fired heat treating furnaces, 
reduce operating costs, improve productivity and parts quality, and 
reduce emissions and fuel consumption.
    Finally, A.G.A. recommends the restoration of funding ($2 million) 
in fiscal year 1998 to continue important basic research in the areas 
of combustion systems and controls, with specific emphasis on the 
automation of industrial processes. In fiscal year 1997 DOE requested 
and received almost $2 million for these important cross-cutting 
activities.
                            vi. gas turbines
    The Energy Information Agency's (EIA) 1996 Energy Outlook and the 
GRI Baseline Projection of U.S. Energy Supply and Demand (1996 
Edition), both project that total gas demand for electricity generation 
is projected to grow from 4.3 quads in 1994 to over eight quads in 
2015. The portion of this gas demand in industrial and commercial 
cogeneration is projected to more than double, from 1.1 quads in 1994 
to 2.7 quads in 2015. Growth in gas-fired cogeneration capacity is 
strongly impacted by the move toward a more competitive electric 
market. Low operating and capital costs and increased-efficiency 
systems are the key to this market.
    A.G.A. strongly supports full funding for DOE's Advanced Turbine 
Systems Program, particularly the industrial-size gas turbine system. 
Research will be geared toward reducing NOX emissions at the 
higher temperatures (required to increase system efficiency) without 
increasing emissions of CO or unburned hydrocarbons. The critical 
research issues include: system efficiency, emissions, and materials 
development and performance demonstrations.
                            vii. fuel cells
    A.G.A. places a very high priority on DOE's Office of Fossil 
Energy's entire Stationary Fuel Cell program. Additionally, A.G.A. 
supports DOE's Office of Energy Efficiency's Building Sector Micro-
generation program. Fuel cell power systems are poised to enter the 
market for dispersed power generation and will be available in the 
future in a variety of sizes and types to fill the diverse power 
generating needs of the commercial, industrial and utility sectors. 
Fuel cells are very efficient energy converters. Compared to the 
average 35 percent efficiency of the present electrical grid, the 
projected fuel-to-electric conversion efficiency for fuel cell power 
plants range from 45 percent, for the units about to enter the market, 
to 70 percent for units that could become available by 2010. The ultra-
low emissions and good-neighbor features of fuel cells enable them to 
be sited close to the end users, eliminating losses associated with 
long-distance transport over high-voltage lines. The ultra-low 
emissions include virtually zero NOX and SO2 
levels, and the lowest CO2 emissions of any fossil fuel 
power plant. The worldwide market for fuel cells is projected to be $3 
billion per year in the post-2000 era with an exponential growth in the 
market after 2010.
    A.G.A. supports DOE's efforts to integrate fuel cells into 
commercial building applications. Applications in the building sector 
represent a large market for fuel cells and a significant opportunity 
for increased energy efficiency. The combination of electricity and 
heat generation give these market entry units an overall energy 
efficiency of 85 percent and make them an excellent candidate for 
commercial building sector applications.
                        viii. natural gas supply
    The GRI Baseline Projection of U.S. Energy Supply and Demand, 1977 
Edition, of U.S. domestic natural gas production shows a potential 
increase from 19 quads in 1995 to 27.3 quads by 2015, an increase of 
over 40 percent. By the year 2015, about 40 percent of U.S. gas supply 
will depend on the availability of new technology. There have been 
significant environmental benefits to the nation from greater gas use 
in our energy mix. A.G.A. supports DOE's natural gas supply request. 
For gas supply to continue to grow, at low and stable prices, new and 
improved technology advances will be needed to reduce exploration and 
production costs and increase recovery per unit of activity.
    DOE should concentrate on working with industry to develop and 
demonstrate a set of tools that result in a minimum of formation damage 
during the drilling, reduce the cost and improve the efficiency of gas 
recovery from mature fields, and minimize overall environmental 
impacts.
    Federal assistance is also needed to ensure that new regulations 
can be met adequately, consistently and at the lowest possible cost. A 
recent National Petroleum Council study noted that the combination of 
projected requirements of the Clean Air Act Amendments of 1990, the 
Safe Drinking Water Act and other pending federal legislation could, by 
the year 2010, raise overall gas-producing costs by as much as $750 
million per year.
                             ix. conclusion
    U.S. Industries compete in a global economy where our major 
competitors, such as Japan, Great Britain and Germany, provide 
substantial assistance in RD&D and commercialization activities. 
Natural gas technologies can provide substantial benefits to the nation 
through cleaner air, job creation, energy efficiency, energy security 
and increased competitiveness in the world marketplace.
    Thank you for the opportunity to present our views.
                                 ______
                                 

  Prepared Statement of Aris Melissaratos, Vice President of Science, 
           Technology and Quality, Westinghouse Electric Co.

                              introduction
    Advanced natural gas based power generation systems can save 
energy, reduce greenhouse gas emissions and lower electricity 
generation costs. Natural gas based systems are clean, efficient and 
economical. Westinghouse is participating with the Department of Energy 
in two key programs under the auspices of the sub-committee. 
Westinghouse urges Congress to maintain its commitment to the next 
generation of natural gas fueled power generation technologies by 
increasing funding beyond the Administration's fiscal year 1998 request 
for the Department of Energy's Advanced Turbine System (ATS) Program 
and for Advanced Concepts Fuel Cells, i.e. Tubular Solid Oxide Fuel 
Cells. We request that funding for the Fossil Energy ATS Program be 
increased from the Administration's $31,379,000 recommended level to 
$46,400,000, and to increase funding for Advanced Concepts Tubular 
Solid Oxide Fuel Cells from $12,288,000 to $16,000,000. Both 
technologies represent a step change in performance over existing 
alternatives, both can provide near team benefits and returns for our 
nation in the form of more high quality jobs and increased exports; and 
both would enable a deregulated utility industry to reduce electricity 
prices to consumers while reducing the emission of greenhouse gases.
                    advanced turbine systems program
    The Advanced Turbine Systems (ATS) Program is a broad-based 
technology initiative, pooling the resources of the federal government, 
universities, and private industry to provide the nation with the 
world's most economical and cleanest approach to multi-hundred megawatt 
electricity generation. The ATS will enable a step change in 
performance over today's gas turbines. The ATS is being designed to be 
over 25 percentage points more efficient than conventional coal fired 
power plants, to emit a fraction of the greenhouse gases and to be 
installed quickly and economically to meet growing energy needs. The 
ATS will allow the nation's utilities and private power generator to 
save fuel and produce electricity at a lower cost, benefiting both 
consumers and the economy.
    The ATS Program, since its initiation in fiscal year 1992, has been 
structured with a clear set of deliverables and aggressive completion 
date. The program goal is to develop technologies and innovative 
concepts applicable to natural gas fired combined cycle power 
generation systems, which will allow electrical efficiencies greater 
than 60 percent, while providing electricity at significantly lower 
cost than current combined cycle power plants; and operating with much 
reduced environmental impact.
    Westinghouse is an industry participant in the utility portion of 
the ATS Program, bringing a significant share of private funding to the 
initiative. We are working with over 200 industrial, university and 
small business partners to integrate the new technologies needed to 
deliver ATS to the power generation industry. Benefits of a technology 
partnership approach include a more rapid introduction of new 
technology into the economy, a broader diffusion of technologies across 
a number of industries and, with ties to universities, providing hands-
on experience for tomorrow's scientists and engineers.
    The ATS Program was originally structured to include a full-scale 
power plant demonstration of the technology, with selection of a lead 
contractor in fiscal year 1998. We urge, instead, that the program be 
restructured to maintain two industrial participants through testing of 
the prototype engines. Out-year program savings from the elimination of 
the full-scale demonstration power plant are sufficient to continue 
funding for two contractors and still result in an overall savings to 
the program. By completing prototype engine tests, needed verification 
of the key technology component is accomplished; but the cost and 
lengthy permitting and approval process need for a full-scale plant is 
avoided. The Administration's low funding request and planned 
downselect will, in effect require DOE to pick a technology winner, 
creating an unfair market advantage for the selected contractor. The 
low funding request will also stretch the length of the program and 
delay market energy of the technology.
    Added ATS funding in fiscal year 1998 will support completion of 
the technology development program started in prior fiscal years and 
the start of manufacture of a prototype engine. The restructured 
program we recommend would still accomplish the original program goals 
of allowing the introduction of this beneficial technology by 2000. It 
would maintain a strong U.S. market competition by continuing two 
suppliers and would provide U.S. industry with a competitive advantage 
over international competitors. And, it would encourage more rapid 
utility industry acceptance by demonstration the viability of the 
technology, without funding a full demonstration power plant.
                  fuel cells advanced concepts program
    The Fuel Cells Advanced Concepts Program for fiscal year 1998 is a 
cost-shared program directed toward cost reduction and product 
improvement for tubular solid oxide fuel cells (SOFC's) prior to market 
entry by the private sector. Westinghouse is the recognized world 
leader in SOFC technology development and SOFC system demonstrations at 
increasingly larger scale and is committed to making the Tubular Solid 
Oxide Fuel Cell Program and success. Westinghouse has assembled a 
world-class team utilizing the resources of government, national 
laboratories, and private industry to provide the world with the 
highest efficiency and cleanest fossil fuel power generation technology 
known today. The SOFC, when combined with a gas turbine will be able to 
achieve electrical efficiencies approaching 75 percent. The SOFC/Gas 
Turbine power system has the potential to be the world-wide standard 
bearer for distributed power generation in the early 2000's and beyond, 
thus developing an industry of high quality U.S. jobs.
    The SOFC/Gas Turbine power system is simple and synergistic, 
building on the best characteristics of both components. SOFC is the 
highest temperature fuel cell and its exhaust gases are exceptionally 
well suited to drive a gas turbine resulting in these ultra-high 
electrical efficiencies. Even in relatively small power systems 
generating only a few megawatts, electrical efficiencies of up to 75 
percent can be obtained previously unheard of with fossil fuels.
    The ecological benefits are huge. There is a 90 percent reduction 
in NOX emissions and 20 percent reduction in CO 
emissions compared to today's best fossil fuel power generation 
technology. The system produces virtually no SOX since the 
sulfur is removed prior to the natural gas entering the SOFC. In 
addition, the high temperature heat produced by the SOFC is very 
conducive to co-generation applications that will further increase the 
effective use of our fossil fuels.
    The SOFC is a modular system that can range in size from several 
hundred kW to hundreds of megawatts. Its high efficiency in relatively 
small sizes is ideal for distributed power generation with the many 
advantages of that concept especially where small increases in power in 
local areas are needed.
    SOFC power systems have excellent export potential in the over 500 
billion dollar international electric energy market where fuel costs 
are high and electrical grids are weak thus creating many well paying 
jobs here in the U.S.
    Matched by the DOE, Westinghouse and its partners have invested 
over $90,000,000 in this technology. This year we will begin the final 
phase of this development program. The ultimate goal of our program is 
to operate a 1.3 MW SOFC/Gas Turbine power system in cooperation with 
the Environmental Protection Agency (EPA) and others at EPA's Fort 
Meade Laboratory in 1999, then expanding that to a 2.5 MW SOFC/Gas 
Turbine power system in 2000. Our program also includes the necessary 
cost reduction and product improvement activities to assure commercial 
success. Along these lines Westinghouse has recently completed a 
$13,000,000 pilot manufacturing plant to test these on-going process 
improvements.
    With the low funding request for Fuel Cells Advance Concept, 
coupled with the decrease in the Stationary Fuel Cell Program budget 
under the auspices of the Committee over the past few years, it is 
unclear that DOE will be able to continue funding for all the 
contractors and achieve commercialization of any advanced fuel cell 
technology with the foreseeable future. Congress is, therefore, urged 
to increase the overall Fuel Cell Program budget from $46,000,000 to 
$50,000,000 in fiscal year 1998.
                            public benefits
    Increased funding for the ATS Program and the Tubular SOFC Program 
is a sound application of federal resources.
  --Federal support is a good investment because it provides a high 
        yield, relatively near term return to the economy in the form 
        of lower energy costs, more jobs and more exports.
  --Federal support benefits the nation's technology base and supports, 
        not only the power generation industry, but possible use in a 
        host of spin-off application. High temperature ceramics and 
        other advanced materials, enhanced aerodynamic component 
        designs and low emissions combustion systems can also have host 
        of industrial applications.
  --Federal support is needed because the aggressive goals of these 
        programs, requiring improved emissions and better economics 
        carry too great a technology risk for private industry to 
        address alone because the long-term ecological and long-term 
        energy saving benefits rarely accrue sufficiently to the 
        original developer of the technology. The Programs continue the 
        kind of public-private partnership that is needed to develop 
        and commercialize high risk technologies.
                              conclusions
    Applying new technology to meet the demands of a changing market is 
always a challenging task. Together, we have made great progress in 
developing clean, advanced natural gas power generation turbine and 
fuel cell systems. Together, we have moved from basic concepts and 
bench scale experiments to full scale component tests. We have made a 
mutual commitment to move these advanced technologies into the market. 
Continuing Federal support is critical to that task. As we approach 
fiscal year 1998, we urge Congress to strengthen its commitment to 
technology development as a sound approach to meeting our nation's 
future energy needs.
    The Advanced Turbine System and Advanced Concepts Solid Oxide Fuel 
Cells both hold the promise of being better economically and 
environmentally at meeting the electricity generation needs of our 
nation and the world. Westinghouse is convinced that, with our 
university, small business and industrial partners, and, in cooperation 
with the Federal government we can develop and introduce these advanced 
power generation systems sooner and better than our international 
competitors. Westinghouse remains committed to that task and urges 
Congress to reaffirm its commitment.
                                 ______
                                 

Prepared Statement of the Integrated Petroleum Environmental Consortium

    It is proposed that the U.S. Department of Energy establish and 
support a focused, university-based program, the Integrated Petroleum 
Environmental Consortium (IPEC), with the goal of increasing the 
competitiveness of the domestic petroleum industry through a reduction 
in the cost of compliance with U.S. environmental regulations. Federal 
support is specifically requested as part of the fiscal year 1998 
appropriation for the Department of Energy through the Fossil Energy 
account or other source the Subcommittee may determine to be 
appropriate.
           the crisis in the u.s. domestic petroleum industry
    The availability of energy will be the single most important factor 
in determining quality of life in the United States over the next 
century. Jobs, manufacturing output, transportation, and personal 
comfort are all tied to a plentiful, affordable energy supply. The 
petroleum industry has played a major role in meeting energy needs in 
this century. Petroleum will continue to be a major factor in the 
energy needs of the world well into the next century. However, the 
declining price of crude oil and the increasing cost of compliance with 
environmental regulations have combined to produce a decrease in 
domestic oil production in the U.S. The major oil companies have scaled 
down their domestic operations and refocused their exploration and 
production activities on foreign resources. The 8000 independent 
producers are faced with two options--producing from the domestic 
resource base or going out of business. At the same time, the 
independents are increasingly the inheritors of mature fields and 
reservoirs left behind by the majors. Yet compared to the major 
producer the independent is the most vulnerable to the declining price 
of oil and gas, the costs of environmental compliance and unfavorable 
tax policies. The independent producer has only one source of revenue--
the sale of oil and gas. There is no vertical depth to his business. 
These factors have combined to not only greatly reduce the number of 
new wells drilled but also to accelerate the plugging of marginal or 
stripper wells. In the U.S. a stripper well is plugged every 30 
minutes. At the same time new well completions are at a 45-year low.
    Clearly this trend is not in the best interest of the U.S. in terms 
of energy self-sufficiency or national security. We are turning over 
control of our cost of production in terms of energy costs to foreign 
interests. If domestic exploration and production and refining are to 
continue to play a strategic role in meeting US energy needs, the 
domestic petroleum producer will require access to low cost technology 
for waste minimization and environmental remediation in exploration and 
production (E&P), refining, transportation and end use of petroleum.
    In many cases this technology does not now exist in a cost-
effective form. Conventional waste treatment and pollution control 
technologies always add to E&P, refining and transportation costs. 
These costs are increasingly out of proportion with the economic output 
of the petroleum industry. In 1991, four industry sectors (chemicals, 
petroleum, pulp and paper, and primary metals) incurred three-fourths 
of the $21 billion spent by U.S. manufacturers to comply with pollution 
control regulations. However, these sectors accounted for about one-
fifth of U.S. manufacturers' value added (Office of Technology 
Assessment). In 1992, the domestic petroleum industry spent $10.5 
billion on the environment. This is more than the top 300 oil and gas 
companies earned in profits that year and more than the industry spent 
searching for oil and gas in the U.S. in 1992. With oil at $16 per 
barrel at the wellhead, the industry spent $4 on environmental 
protection for every domestically produced barrel of oil--$41 for every 
man, woman and child in America (Oil and Gas Journal and the American 
Petroleum Institute).
    All U.S. industry is caught in the convict between national 
economic and environmental goals. Pollution control in the petroleum 
industry presents regulatory hurdles for U.S. domestic production and 
refining that producers and refiners in many other countries do not 
face. This places U.S. producers and refiners at a global competitive 
disadvantage. The U.S. petroleum industry needs cleaner, more cost-
effective technologies and new approaches to lower the costs of 
complying with pollution and waste disposal regulations that U.S. 
society demands. A reduction in environmental compliance costs will 
have the greatest impact on the national economy when applied at this 
level--the level of the extraction industries. Lower energy costs make 
all industry more competitive. The petroleum industry and the nation 
would benefit not only from lower compliance costs, but also from the 
jobs and commerce preserved in the domestic petroleum industry and the 
related trade in capital equipment and professional services in 
industries that service the petroleum industry. New technologies for 
pollution control and remediation will also be an exportable product.
        the integrated petroleum environmental consortium (ipec)
    For strategic and economic reasons the U.S. domestic petroleum 
industry must be able to compete with foreign producers and refiners. A 
major sector of our economy and our national interests are clearly at 
stake. Compliance with environmental regulations is a major factor in 
that competitiveness. The strategic and economic importance of this 
industry requires that industry, government and academia combine their 
resources and coordinate their efforts toward finding solutions for the 
environmental problems that represent the greatest challenge to the 
competitiveness of the domestic petroleum industry. The success of this 
effort will not only stimulate jobs in this industry sector, but also 
contribute in a large way to the environmental health of the nation. In 
response to this need, the four major research universities in the oil-
producing states of' Oklahoma and Arkansas have joined together to form 
the Integrated Petroleum Environmental Consortium (IPEC). The mission 
of IPEC is to increase the competitiveness of the domestic petroleum 
industry through a reduction in the costs of compliance to U.S. 
environmental regulations. Objectives specific to meeting the goals of 
the consortium include the following:
1. Development of cost-effective technologies and business practices to 
        meet the challenges of environmental regulations to the 
        competitiveness of the domestic petroleum industry
    As already noted, new technologies are needed in the petroleum 
industry now to provide cost-effective solutions to environmental 
problems in exploration and production and refining. The U.S. petroleum 
industry is already undertaking this challenge; however, the industry 
needs help. The domestic petroleum industry is devoting ever more of 
its resources toward meeting a growing body of environmental 
regulations as the price of oil declines. The inevitable result has 
been severe reductions in work force and closings. The domestic 
petroleum industry has lost over 500,000 jobs in the last decade. It is 
time for the federal government to re-evaluate the regulatory burden on 
the domestic petroleum industry and to help the industry develop the 
cost-effective technologies it needs to meet meaningful environmental 
standards. With a dwindling technical work force caused both by 
redirecting E&P operations and layoffs, the domestically-oriented work 
force is increasingly focused on environmental compliance, not 
technology development. Industry laboratories which were once on the 
forefront of technology development are now empty and dormant. What is 
left of the once busy industry research centers are technical service 
centers. The former research leaders still employed are now ``putting 
out fires'' and the independent producers rarely have a technical staff 
for any kind of R&D. The U.S. petroleum industry is relying more and 
more on technical professionals in academia for research. However, 
budgets are tight and only the most immediate of problems are being 
addressed. Even a 3-5 year time frame is often farther out than the 
industry can afford to look.
    The federal government should direct a larger segment of R&D 
resources to the development of new, cost-effective environmental 
technologies to support the domestic petroleum industry. A critical 
segment of this effort should be support of university research. A 
major part of this research funding should place emphasis on providing 
near-term solutions to these problems with direct input from the 
petroleum industry. In partnership with industry, IPEC can help provide 
these solutions.
    The petroleum industry will measure the relevancy of research in 
terms of the tangible results produced. In the context of the vision of 
IPEC this means new, cost-effective technology made available to 
industry. The greatest impact on competitiveness on the domestic 
petroleum industry will be made by improved solutions to problems which 
have a significant economic impact on the industry. The research 
conducted within IPEC will, therefore, by necessity have a strong 
applied element.
    IPEC will use an integrated team approach to technology 
development. The teams will not only be integrated with respect to 
scientific or engineering discipline but also integrated with respect 
to the technology development process itself: In other words the teams 
will also consist of members whose expertise is in scale-up and 
commercialization of new technology. If the work product of the team is 
to make a significant impact in the domestic petroleum industry the 
most important member of the team will be the end user of the 
technology. A teaming of investigators from different disciplines and 
representing different levels of the technology development process 
will greatly facilitate communication among the investigators and keep 
the team focused on solving the problem. The team approach is certainly 
the shortest path to making a meaningful impact on the competitiveness 
of the domestic petroleum industry.
    This team and systems approach to solving real problems in the 
domestic petroleum industry will be the hallmark of IPEC. Fundamental 
research will be coupled with bench-scale testing of concepts, pilot 
testing, field demonstrations and technology transfer. The end user of 
the technology will always be heavily involved in technology 
development as an advisor and hands-on participant. As an investment in 
future technology development, undergraduate and graduate students will 
be integrated into every aspect of the work of the consortium. 
Undergraduate students will gain valuable experience working on 
consortium projects while graduate students will use consortium 
research work for their theses and dissertations. The integrated 
approach to technology development will give these students much needed 
pilot and field experience and industrial contacts.
    Competitive business practices are perhaps equal in importance to 
technology development, especially to the independent producer. The 
development of new business practices with respect to accounting, 
taxation, finance, forecasting, etc. are needed which can put the 
producer in a better positron to determine the financial risks of 
potential environmental costs and manage those risks in order to 
maximize profitability. Reduced financial risk and growth create jobs.
2. Training of environmental professionals as an investment in 
        technology, policy and business development
    IPEC universities will continue to graduate scientists and 
engineers who have a strong foundation in a basic engineering 
discipline, physical science, or biological science with additional 
training in environmental technologies at the undergraduate or graduate 
level to produce environmental specialists. Environmental issues cut 
across many disciplines. Therefore, this additional training is cross 
disciplinary to give students a broad understanding of environmental 
problems. This includes environmental law and policy and the financial 
and economic impact of environmental regulation on the domestic 
petroleum industry.
    Environmental policy curricula at IPEC universities will be 
enhanced to include a prerequisite foundation in a field of engineering 
or science. Those who shape environmental policy should fully 
understand the impact of those policies. IPEC universities also will 
develop new curricula to explore the boundary between environment and 
business in terms of accounting practices, economics, finance and 
taxation. A new kind of environmental specialist, invaluable to the 
petroleum industry, can arise out of the area where issues of 
environment and business converge.
    In addition to training the environmental specialist, TPEC 
universities are committed to making all of their graduates 
environmentally aware. This is especially true of graduates in 
technical fields whose employment activities can have a direct 
environmental impact. These curricula will be enriched with an 
environmental component integrated into their course of study. The 
result of this enrichment will be a scientist or engineer who considers 
the environmental impact of a project up front and minimizes wastes.
3. Dissemination of information regarding technology development, legal 
        and regulatory issues, and business practices which can impact 
        the competitiveness of the domestic petroleum industry
    Research results from all IPEC technology and business practice 
development projects will be documented through standard DOE reporting 
procedures. IPEC investigators also will deliver papers and contribute 
journal articles on noteworthy achievements. All resulting citations 
can then be picked up and disseminated through such standard online 
databases as DOE's ``Energy Science and Technology,'' the American 
Petroleum Institute's RAPIDITY, and TU's ``Petroleum Abstracts''.
    IPEC also will provide a central repository for all reports, 
papers, and articles resulting from its research projects. These 
documents will be available on demand from the repository for the 
fulfillment of external orders. Where appropriate, IPEC research 
results also will be compiled into databases for nationwide access via 
Internet. Information concerning the databases will be distributed to 
the domestic petroleum industry and other interested users through 
exhibits at selected conferences, the trade literature, target mailings 
and Internet Listserv messaging. Every effort will be made to guarantee 
equity of access throughout the petroleum industry. IPEC also will 
establish a feedback mechanism through which the major and independent 
oil and gas producers can inform the R&D community of their experiences 
with new technologies as well as their technology needs.
    IPEC also will serve as a resource for Congress, federal and state 
regulatory agencies and the domestic petroleum industry to provide an 
objective assessment of existing or proposed environmental regulations 
on the basis of cost/benefit and risk analysis.
    Lastly, there also is an acute need for readily accessible 
continuing education opportunities for scientists, engineering, legal 
professionals, accountants, economists, etc. in the petroleum industry 
to provide environmental retooling and continual updating. The 
environmental field is progressing rapidly. Activities such as focused 
environmental seminars, workshops, short courses, telecourses, etc. can 
sharpen the shills of participants and act as conduits for new ideas 
and technologies into the petroleum industry.
              organization and operating practices of ipec
    The Integrated Petroleum Environmental Consortium (IPEC) is a 
consortium of four universities in Oklahoma and Arkansas: The 
University of Tulsa (TU), The University of Oklahoma (OU), Oklahoma 
State University (OSU), and The University of Arkansas (UA) at 
Fayetteville. The fiscal center of IPEC will be the University of Tulsa 
which is the sole subcontractor to BDM-Oklahoma which is the M&O 
contractor for the Bartlesville, OK Department of Energy facility, the 
National Institute for Petroleum and Energy Research (NIPER). Through 
NIPER, BDM Oklahoma and TU are responsible for implementation of the 
National Oil Program for the DOE. IPEC will be an extension of this 
effort.
    The operational activities of IPEC will be directed by an executive 
committee composed of two faculty members and one research 
administrator from each of the four universities (TU, OU, OSU, UA). The 
chair of the executive committee will rotate annually among TU, OU, OSU 
and UA. IPEC will be very much industry driven to ensure that the 
consortium is meeting the needs of the industry and fulfilling its 
mission. The executive committee will be advised by an industrial 
advisory board composed of technical, legal and business environmental 
professionals from major oil companies and independent producers. The 
industrial advisory board will have the last word on funding decisions 
for technology development projects. If, in the opinion of the advisory 
board, a proposed project does not help fulfill the mission of the 
consortium the project will not be funded. All four of the IPEC 
universities have signed a memorandum of understanding forming IPEC and 
agreeing to this organizational structure.
        the south-central environmental resource alliance (sera)
    In order to bring additional resources into IPEC and further ensure 
the success of its programs, IPEC has entered into an alliance with the 
Waste-management Education and Research Consortium (WERC). WERC was 
established through DOE sponsorship to expand the nation's capability 
to address waste management issues through education, technology 
development and technology transfer. WERC's special niche is 
radioactive, hazardous and solid waste management. WERC's members are 
New Mexico State University, University of New Mexico, New Mexico Tech, 
and Navajo Community College in collaboration with Sandia National 
Laboratories and Los Alamos National Laboratory. The missions of IPEC 
and WERC will be enhanced by a synergistic collaboration between the 
two consortia as the South-central Environmental Resource Alliance.
                            funding of ipec
    IPEC is seeking an appropriation of $4 million for fiscal year 1998 
and the succeeding fiscal years 1999, 2000, 2001, and 2002 through the 
Department of Energy. The consortium will be responsible for private 
sector and state support of no less than 25 percent of federal 
appropriations in fiscal year 1998 and an average of 50 percent of 
federal appropriations over a five year period. The consortium will be 
subject to review as of September 30, 1999 and each 12-month period 
thereafter to ensure the effective production of data, regulatory 
assessments, and technology development meeting the stated goals of the 
consortium.
                                 ______
                                 

 Prepared Statement of John T. Nimmons, Managing Director, Alliance To 
                   Commercialize Carbonate Technology

    Mr. Chairman and Members of the Subcommittee, my name is John 
Nimmons. I am submitting this testimony as Managing Director of the 
Alliance to Commercialize Carbonate Technology (``ACCT''). ACCT's 
purpose here is to urge fiscal year 1998 funding of the Department of 
Energy's molten carbonate fuel cell (``MCFC'') program in the amount of 
$20 million requested by M-C Power Corporation, and for continuation of 
a strong MCFC program.
    As some of you know from prior years' testimony, ACCT is a working 
alliance of utilities and industry, created to help bring MCFC 
technology into commercial markets by the year 2000. ACCT's members 
include potential purchasers, installers and users of MCFC power 
plants, as well as potential investors in MCFC technology. During the 
past year, ACCT's membership has continued to grow. Members now include 
twenty-two leading electric and gas utilities, natural gas suppliers, 
and manufacturing industries from throughout the United States, Canada, 
Western Europe, and South America, as well as America's premier 
electric and natural gas research organizations. ACCT's principal focus 
is the MCFC power plant under development by the team of M-C Power 
Corporation, the Institute of Gas Technology, the Bechtel Corporation, 
and Stewart & Stevenson Services, Inc. (the ``Development Team'').
    ACCT wishes to make the following points before this Subcommittee, 
each elaborated further in the testimony that follows:
    1. MCFC technology has made impressive progress in the last year.--
Early lessons have been well learned, and the new MCFC cogeneration 
facility at NAS Miramar is performing well.
    2. NAS Miramar's 250 kilowatt demonstration remains an early step 
toward a megawatt-scale commercial power plant.--Major design 
improvements and cost reductions must still be achieved before MCFCs 
approach commercial readiness.
    3. Although Miramar is attracting strong private sector interest, 
uncertainty over electricity restructuring continues to postpone new 
technology investments.
    4. Electricity restructuring will expand markets for clean, 
modular, generation from MCFCs, even while it creates near-term 
uncertainties about what roles will be played by emerging industry 
entities.
    5. Staying the development course now is critical.--Increased 
private sector confidence, and hence future investment, will depend on 
MCFC developers continuing to meet milestones based on previous Federal 
commitments.
    1. mcfc technology has made impressive progress in the last year
    M-C Power's development effort has made important strides during 
the past year. Building on earlier lessons, the Company developed a new 
fuel cell stack design which it has now incorporated in the new 
demonstration unit recently started up at NAS Miramar. The Company also 
introduced a first-of-its-kind fuel processing unit (or ``reformer'')-- 
uniquely designed for MCFC use--which converts natural gas to the 
hydrogen-rich fuel used in the cell stack. Reports from the Miramar 
test site are very encouraging, indicating that both the new stack and 
the new reformer have performed extremely well since the plant's 
startup in early February.
    The Miramar demonstration remains in its early stages. However, its 
performance to this point in a cogeneration application has already 
moved the technology beyond anything previously accomplished, and begun 
to fulfill the expectations of ACCT member companies for this phase of 
the development effort. If the plant continues to perform well as it 
goes through its paces over time, it will constitute a major milestone, 
and one which ACCT companies have considered an essential building 
block for future commercial interest in the technology.
2. miramar's 250 kilowatt demonstration remains an early step toward a 
                   1 megawatt commercial power plant
    The Miramar facility is expected to demonstrate to ACCT companies 
and others that the major MCFC components--especially the new stack and 
reformer--can function together in an integrated power plant, using 
thermal energy from the fuel cell reaction to heat the reforming 
process, and providing useful electricity and heat to the facility 
site. These represent critical advances over the previous state of the 
art. However, they remain far short of what will be required for a 
power plant intended for commercial markets.
    All who support MCFC development recognize that major design 
improvements and cost reductions must be achieved before MCFCs can 
approach commercial markets around the turn of the century. This is no 
different from many other energy technologies at similar stages in 
their development: the first imperative is to show that the concept can 
work--and only then to embark on simplifying and refining equipment 
design, finding cheaper materials, and developing more efficient 
production methods to reduce costs to near-commercial levels and set 
the stage for true manufacturing economies.
    In addition, ACCT members and others who expect to invest in MCFC 
power plants will need to see convincing evidence of performance, 
reliability, and durability over time. This will require demonstration 
of the power plant configuration actually intended for commercial 
markets. Only after these requirements are met will private sector 
companies be in a position to commit to commercial investments, and 
thus to help the developer attract the private financing needed for its 
commercial manufacturing facility.
   3. uncertainty over electric industry restructuring continues to 
                  postpone new technology investments
    Electric industry restructuring has accelerated dramatically during 
the past year. In addition to this Congress, virtually every state 
utility commission is considering some form of restructuring of 
utilities subject to its jurisdiction: there is no electric utility in 
this country whose immediate future will not be affected by it. Every 
one of our utility members is fundamentally reassessing its business, 
including the key question of whether it will continue to provide 
generation at all--and if so, through what business entity and with 
what relation to its regulated transmission and distribution functions, 
whatever those turn out to be.
    Last year we noted that the turmoil of restructuring and the 
headlong rush toward electricity competition had dramatically reduced, 
and in many cases eliminated, utility spending on research and 
development. This is especially true for generation-related RD&D, since 
utilities and state commissions increasingly recognize that generation 
will be spun out of the regulated utility as a competitive function, 
and monopoly ratepayers can no longer provide financial support for 
advanced generation research.
    Proactive utilities are increasingly looking to supplant 
traditional ratepayer RD&D spending with shareholder-supported 
investments in technologies that promise advantages in emerging 
competitive markets. However, the enormous uncertainty attending 
restructuring has radically shortened the horizon for such investment. 
Many companies today will not invest in emerging technologies unless 
they can expect returns within two or three years, at the most. For 
MCFC technology, which still requires significant design and 
manufacturing innovations and cost reductions to approach commercial 
readiness, meaningful investment returns will not occur within that 
horizon. In the current utility climate of regulatory ferment and 
short-term competitive focus, this presents a short-term investment 
obstacle for most companies--even those which foresee a key role for 
fuel cells in the medium and long term.
    We stress that reduced availability of advanced generation RD&D and 
investment dollars does notreflect on the value of these efforts, but 
on the vast uncertainty faced by companies confronting restructuring of 
one of the country's largest, most complicated, and most important 
industries, and on the prospect that utilities will need to divest 
their generation functions. For these reasons, ACCT's leaders believe 
it is vitally important to continue Federal RD&D support through the 
next several critical years, until the costs and risks of MCFC 
technology can be reduced to near-commercial levels, and the returns 
can more closely match the compressed investment horizons of newly 
competitive energy companies. For Congress to do otherwise would be to 
abandon substantial public and private investments already in place and 
now beginning to pay off, and to forego the economic, environmental, 
and competitive advantages that advanced fuel cell development can 
deliver.
 4. electricity restructuring will expand markets for clean, modular, 
                         generation from mcfcs
    Although restructuring has created tremendous uncertainties about 
what roles will be played by existing industry entities and their 
successors, we believe that it can only enhance long-term market 
prospects for small, clean, modular generation sources such as MCFCs.
    As this Subcommittee knows, MCFCs offer dramatic efficiency and 
environmental advantages over both conventional generating technologies 
and other types of fuel cells. These advantages will be increasingly 
important as electricity supply continues to evolve from large central 
station generation plants to smaller, cleaner, more flexible power 
plants located near the customers they serve, and avoiding the risks 
and costs of major infrastructure investments in uncertain times. The 
flexibility of modular plants with short lead times will become 
especially critical as competition supplants monopoly electricity 
supply, and customers demand products and services that can readily 
respond to changes in business conditions.
    In emerging competitive markets, new generation capacity will be 
added in much smaller increments than traditional central station 
plants. However, the high fuel efficiencies characteristic of large 
central plants cannot be achieved with conventional technologies in 
small sizes. On the other hand, MCFCs as small as a few hundred 
kilowatts can actually exceed central plant efficiencies--while 
offering emissions characteristics orders of magnitude cleaner than 
conventional equipment.
    For many utility and industrial applications, MCFCs also offer 
distinct advantages over other types of fuel cells now under 
development. For example, MCFCs promise as much as 50 percent higher 
fuel conversion efficiencies than phosphoric acid fuel cells (``PAFC'') 
now entering the market, with even lower air pollutant emissions--
amounting to less than 10 percent of current Federal air quality 
standards. For this reason, California's South Coast Air Quality 
Management District has categorically exempted fuel cells from the 
nation's most stringent air quality permitting requirements. In 
addition, MCFCs can produce much higher quality heat as a byproduct of 
electric generation than that produced by PAFCs, so they are especially 
suitable for utility and industrial cogeneration uses that PAFCs cannot 
serve. MCFCs are also far less sensitive to fuel contaminants than, for 
example, polymer fuel cells. For this reason, MCFCs are expected to 
operate well not only on natural gas, but on domestic renewable fuels 
such as landfill gas and methane from sewage digesters, which the M-C 
Power team expects to demonstrate within the next several years.
   5. staying the development course now is the key to building the 
        confidence needed to encourage private sector investment
    A vital part of ACCT's mission is to help build industry confidence 
in MCFC technology, and to develop a framework for early purchase 
commitments to shepherd the technology into the marketplace. ACCT 
members have and will continue to work closely with the M-C Power Team 
to help it meet its development milestones, because they believe this 
is the key to creating private sector confidence and positioning the 
technology for success once its development is complete.
    Increased private sector confidence, and hence future investment, 
will depend on MCFC developers continuing to meet these milestones, 
which in turn depends on the availability of Federal funds previously 
committed, and on the continued support of this Subcommittee. For 
ACCT's members, the successful startup of NAS Miramar is an extremely 
important accomplishment, for which we wish to acknowledge not only the 
M-C Power Development Team, but the constancy of this Subcommittee, the 
Congress, and the Department of Energy. At the same time, we recognize 
that much remains to be done. The power plant must be scaled up 
fourfold to the one-megawatt size planned for commercial deployment, 
while substantially reducing its costs through design and materials 
innovations. The megawatt-scale plant must then be demonstrated to the 
satisfaction of the market under a range of climatic conditions, fuel 
types, and operating regimes critical to ACCT's utility and industry 
members, and to other potential purchasers and users.
    Each phase of this effort is planned to include substantial 
private-sector cost sharing. However, the magnitude of the undertaking 
and the risks it entails remain beyond the means of individual ACCT 
companies. MCFCs promise important societal benefits in the form of 
resource conservation and efficiency, environmental improvements, lower 
energy costs, and an enhanced competitive position for US industries. 
For these reasons, we continue to believe that substantial Federal 
funding remains both appropriate and essential to advance the 
technology and help US firms compete in world energy markets over time, 
and we urge this Subcommittee to stay the course and continue its 
support of the Department of Energy's MCFC program at levels that will 
permit the sustained, orderly development our members need to see.
    I am grateful to the Subcommittee for this chance to present our 
views, and I thank you on ACCT's behalf.
                                 ______
                                 

   Prepared Statement of Peter J.A. Tijm, Manager, Syngas Conversion 
               Systems, Air Products and Chemicals, Inc.

    I strongly encourage the Subcommittee to provide an additional $5.8 
million fiscal year 1998 appropriation for the Indirect Liquefaction 
program. These monies would be in addition to the DOE Fossil Energy 
fiscal year 1998 Budget Request of $4.2 million. This appropriation 
would enable continuation of proof-of-concept demonstrations at the 
DOE-owned LaPorte, Texas Alternative Fuels Development Unit (AFDU) and 
provide for supporting laboratory research and development.
    The Federal Government has committed to a national objective of a 
cleaner environment through the use of cleaner burning transportation 
fuels that are environmentally superior to gasoline and diesel fuels 
based on crude oil. These innovative fuels will need to yield 
significantly lower emissions of particulate matter (PM10), 
NOX, SOX and CO2. One can calculate 
that replacement of crude-derived diesel by synthetic diesel, made 
through Indirect Liquefaction, would have resulted in a reduction of 
100-160 million tons of carbon dioxide per year for the U.S. 
transportation sector alone in 1995, a reduction of 25-40 percent 
(``Automotive Engineering,'' Feb. 1991, Vol. 99, No. 2, pp. 15-18, and 
1995 IEA statistics). However, while the Government has established 
goals and objectives to reduce emissions, no commercially accepted 
technology currently exists that would enable such goals to be met. 
This lack of appropriate technology creates situations in which 
compliance deadlines are extended rather than met. Indirect 
Liquefaction is an emerging technology with the capacity to solve these 
problems.
    The Indirect Liquefaction program is directly supportive of the 
Federal Government's stated goals for cleaner air, higher energy 
effciency/lower CO2 emissions, and reduced dependence on 
foreign oil. The information resulting from this program will lead to: 
Industrial acceptance and early commercialization of indirect 
liqefaction technologies; production of highly efficient, 
environmentally superior transportation fuels and premium chemicals 
from our nation's own vast reserves of fossil fuels, as well as 
renewables and environmentally disadvantaged energy sources; production 
of transportation fuels in quantities sufficient to enable vehicle road 
tests; and fulfillment of national environmental and energy security 
objectives.
    The Indirect Liquefaction program--an industry/university/national 
laboratory partnership--has broad-based support, as evidenced by the 
recent industrial cost-sharing from Air Products and Chemicals, Inc., 
Eastman Chemical Company, Bechtel, and Shell Oil Company.
    U.S. industries, universities and national laboratories are working 
at a laboratory scale to develop transportation fuels: That will meet 
the Government-desired emissions regulations; that can be handled in a 
manner that is compatible with the existing transportation fuel 
distribution infrastructure; and that are produced from a variety of 
indigenous feedstocks including coal, natural gas, biomass, as well as 
petroleum coke and a variety of other environmentally disadvantaged 
feedstocks.
    However, laboratory-scale experiments alone provide insufficient 
information for industry to take the significant technical and economic 
risks involved in scaling up technology from the laboratory to 
commercial operation. LaPorte AFDU operation provides engineering and 
economic data, the intermediate step that will enable industry to 
assess scaleup and commercialization potential for the production of 
superior liquid transportation fuels from domestic carbonaceous 
feedstocks. Additionally, the AFDU produces these superior fuels in 
sufficient quantity to allow road testing in actual vehicles.
    Since 1985, Congress and the Department of Energy have invested 
over $25 million to build and maintain the LaPorte AFDU as a state-of-
the-art facility for synthesis gas conversion. Results of AFDU 
operations have proven the efficiency and cost-effectiveness of 
producing methanol via the Liquid Phase technology. This technology 
provides a means to lower U.S. dependence on foreign sources of 
methanol. Significantly, the value of the AFDU is becoming 
internationally recognized; a growing number of energy and chemical 
companies are indicating a strong interest in sharing in the cost of 
operating the LaPorte AFDU to develop various transportation fuels and 
premium chemicals via Indirect Liquefaction technologies. These 
technologies first involve the well-established process of synthesis 
gas production from any carbonaceous feedstock, yielding a mixture 
comprising primarily hydrogen and carbon monoxide, with all polluting 
compounds removed. The new, emerging Liquid Phase technologies convert 
this clean synthesis gas to environmentally superior liquid 
transportation fuels and oxygenated fuel additives that can use the 
existing transportation fuel infrastructure--a major financial 
consideration.
    From its inception in 1984 through 1990, the LaPorte AFDU was used 
to develop the Liquid Phase Methanol (LPMEOHTM) technology. 
This program was aimed at converting carbon-rich synthesis gas, such as 
that derived from coal, biomass or waste materials like petroleum coke 
or bottom-of-the-barrel residual oil, to methanol. This application has 
appeal both for the power and the refinery processing industries for 
coproduction of electric power and methanol for power peak shaving or 
as a chemical feedstock. With support from Chem Systems Inc., the 
Electric Power Research Institute, and Air Products, DOE pioneered the 
LPMEOHTM process, introducing first-of-a-kind technology 
that successfully converted carbon-rich synthesis gas into methanol. 
Success at LaPorte led to a proposal and subsequent award under the 
Clean Coal Technology Program. The resulting LPMEOHTTM 
process demonstration unit, located at Eastman Chemical's Kingsport, 
Tennessee chemical complex, was started up in early April and is 
producing methanol at the design capacity of 260 tons per day.
    With successful technical development of the Liquid Phase Methanol 
technology, the program objectives were broadened to develop other 
environmentally superior transportation fuels and chemicals from 
synthesis gas. In 1991, a unique government/university/national 
laboratory/industrial partnership was created to effectively conduct 
this research and development work with periodic operations at the 
LaPorte AFDU. This program has successfully progressed with 
contributions from DOE/FETC, Sandia National Laboratory, renowned 
researchers at five universities, and seven cost-sharing industrial 
partners (currently Air Products, Eastman Chemical, Shell and Bechtel; 
in the past, support has also been received from Exxon, UOP and 
Statoil).
    The expanding U.S. dependence on foreign oil is neither good for 
our country's balance of payments nor for national security. U.S. oil 
imports are currently more than 50 percent of consumption and are 
expected to reach 60 percent by 2010. Much of the imported oil comes 
from countries that are politically unstable and that may be opposed to 
U.S. interests. Reliance upon foreign petroleum can be reduced by the 
use of Indirect Liquefaction technology, which can utilize many 
different domestic carbon based feedstocks. Thus, Indirect Liquefaction 
can offer the nation a path to a cost-competitive, environmentally 
friendly alternative to foreign oil.
    Environmental legislation and a drive toward energy efficiency has 
spurred the growth of the diesel fuel market. However, to meet 
environmental requirements, clean-burning, high-cetane-number, 
alternative diesel fuels must be developed. A diesel fuel with high 
cetane number features superior, smokeless combustion characteristics. 
The work at LaPorte has initiated the steps needed to reach this goal. 
In 1991, LaPorte was operated to generate dimethyl ether (DME) from 
synthesis gas through a one-step process. DME is viewed in the industry 
as a valuable chemical feedstock, and in 1995 it was proposed as a 
clean-burning, alternative diesel fuel with a high cetane number. Air 
Products is proposing to conduct additional DME operations at LaPorte 
using a more robust catalyst system than previously tested. In the 
laboratory, the combustion products from DME exhibited significant 
emissions reduction of hydrocarbons, carbon monoxide and particulate 
matter relative to low-sulfur petroleum diesel. Levels below the 
requirements for Ultra Low Emission Vehicles (ULEV) were obtained. 
DOE's Office of Transportation Technologies has expressed significant 
interest in conducting further fuel characterization tests, including 
fleet testing, on DME produced in this one-step process. In addition, 
Air Products' proprietary research has developed new diesel fuel 
additives/replacements. The cetane numbers obtained for these unique, 
super-clean diesel alternatives far surpass the cetane number of crude 
oil-based, commercial diesel fuels (i.e., 100 to 225 vs. 40 to 50). 
Continued operation of the LaPorte AFDU would make sufficient 
quantities of fuel available for these, as well as other tests.
    Most importantly, the replacement of conventional diesel by 
synthetic fuels produced by Indirect Liquefaction can reduce tailpipe 
carbon dioxide emissions enormously. One can calculate that this 
replacement for the U.S. transportation sector alone would result in a 
tailpipe reduction of over 100 million tons of carbon dioxide per year, 
a decrease of over 25 percent (``Automotive Engineering,'' Feb. 1991, 
Vol. 99, No. 2, pp. 15-18, and 1995 IEA statistics). Depending on the 
feedstock used to manufacture the synthetic diesel, one could even 
claim an effective reduction of up to 20 percent in CO2 
generation ``from well to wheel,'' an achievement in reducing factors 
that cause Global Warming. Should the exponential growth in the U.S. 
diesel market continue at its present rate, this reduction could be a 
multiple of the aforementioned. One can therefore not stress enough the 
importance of hastening industry's acceptance of the technology.
    Continued LaPorte funding also enables the development of improved 
technologies for the production of clean hydrocarbon fuels using the 
Liquid Phase version of the Fischer-Tropsch process. Shell Oil, along 
with UOP, Statoil, and Exxon, participated, both financially and 
technically, in operations at LaPorte in 1992, and again in 1994. Shell 
Oil provided significant cost share in its participation in Liquid 
Phase Fischer-Tropsch operation in 1996, and is expected to return once 
more in the fall of 1997. These companies are particularly interested 
in the conversion of natural gas to liquid transportation fuels, and 
came to LaPorte because of its unique capabilities. The existence and 
resources of the LaPorte unit are the key reasons why private sector 
companies have committed to pooling their financial and technical 
capabilities to test such new routes to cleaner fuels. Private sector 
funding to date for LaPorte operations is more than $6 million. This 
new, growing role for LaPorte is a strong endorsement for the 
continuation of Federal support for this facility.
    In the future, LaPorte will lend itself conveniently to another 
important development in the production of low-cost liquid fuels via 
Indirect Liquefaction. Production of synthesis gas alone can represent 
well over 50 percent of final product cost, and recently, considerable 
research has been underway to reduce the cost of synthesis gas 
production via selective high-temperature membrane systems. The 
development-scale demonstrations of these technologies in the near 
future could be efficiently accommodated at the LaPorte site, where the 
infrastructure is already in place for such demonstrations. The 
synthesis gas generated could then be used in conjunction with existing 
syngas conversion equipment, allowing the complete step-by-step 
demonstration of fuels production from raw material. Such technologies 
may be well suited to convert the vast quantities of Alaskan North 
Slope natural gas to liquid fuels via the Liquid Phase Fischer-Tropsch 
process. These liquid fuels will utilize the Trans-Alaskan Pipeline, 
thereby extending its functional life. Additionally, a synthesis gas 
generation/liquid fuels production facility could be a feasible source 
of power generation and transportation fuels in remote locations for 
U.S. military needs and for use in under-developed countries.
    DOE's Alternative Fuels Development Unit at LaPorte is a unique 
national resource.--It can be cost-effectively used to test proof-of-
concept approaches for producing clean fuels and high value additives 
via synthesis gas. This synthesis gas can be produced not only from 
coal, but also from natural gas, renewables, and environmentally 
disadvantaged feedstocks such as petroleum coke or bottom-of-the-barrel 
residual oil. Congress is to be commended for its foresight and its 
past support for the LaPorte Indirect Liquefaction program. The 
industry/university/national laboratory partnership for the development 
of Liquid Phase technology would not have been able to continue without 
DOE funding support. In fiscal year 1997, however, funding constraints 
for the Liquid Phase program led to a curtailment of operations at 
LaPorte, although some research activities have continued. In fiscal 
year 1998, if sufficient Government funding is provided, Air Products 
plans to test a Dimethyl Ether process developed under the DOE program.
    The focus of the Indirect Liquefaction program is consistent with 
the national policy of meeting environmental goals through the 
development of clean-burning alternative transportation fuels and 
premium chemicals from a vast array of domestic carbonaceous 
feedstocks. We therefore request that the Subcommittee continue and 
build upon the important work being carried out at the LaPorte AFDU to 
make these goals a reality. Funding of $5.8 million, an amount in line 
with the yearly average dollars needed for facility operations and 
supporting research, should be added to the DOE Fossil Energy Budget 
Request of $4.2 million for the fiscal year 1998 appropriation.
                                 ______
                                 

  Prepared Statement of Richard L. Lawson, President, National Mining 
                           Association [NMA]

    The National Mining Association's (NMA) member companies account 
for approximately three-fourths of the coal production in the United 
States, over one billion tons annually, and the vast majority of mined 
minerals including iron ore, copper, gold, silver, uranium, lead, zinc, 
and phosphate. The purpose of this statement is to present the NMA's 
views on fiscal year 1998 programs for the following agencies: Office 
of Fossil Energy (Department of Energy), Energy Information 
Administration (Department of Energy), U.S. Geological Survey 
(Department of the Interior), the Office of Surface Mining (Department 
of the Interior), the Bureau of Land Management (Department of the 
Interior) and the Forest Service (Department of Agriculture).
                        office of fossil energy
    NMA advocates that the Federal government's partnership with the 
private sector be continued as an integral part of the foundation for 
enhanced utilization of our domestic resources. The continuing 
development of innovative technologies will provide improvements in 
energy efficiency and environmental protection rather than reduced 
availability of energy through the imposition of drastic regulatory 
requirements. NMA supports the following Fossil Energy programs to 
enhance the clean and efficient utilization of coal by developing and 
facilitating commercialization of innovative technologies.
    Clean coal technology program.--The Clean Coal Technology Program 
is a highly successful industry and government partnership designed to 
demonstrate a new generation of innovative coal processes. This 
partnership must be continued in order to obtain the multiple benefits 
derived from coal utilization and clean coal technologies both 
domestically and internationally. The NMA realizes that budgetary 
constraints have and will continue to make the Clean Coal Technology 
Program vulnerable to funding cuts. Additional budget reductions could 
adversely impact approved projects and significant private sector 
investments. NMA urges the Subcommittee to ensure that the Department 
of Energy continues its program management practice of allowing market 
forces to dictate project terminations if additional cost savings are 
necessary.
    Coal research and development.--In the Advanced Clean Fuels 
Research Program, various advanced coal preparation technologies 
promise to enable the nation to continue the use of coal in traditional 
applications in large industrial and electric utility boilers, as well 
as opening new opportunities for high quality coal use in turbines for 
power generation and for liquid fuels. The cost per barrel of these 
liquid fuels, especially with techniques like coprocessing, has shown 
remarkable improvement. Maintaining an ongoing development effort for 
promising systems is both an insurance policy against the disruption of 
imported oil to the U.S. and a necessary investment in establishing an 
economically viable liquid fuels program.
    In advanced Clean/Efficient Power Systems program, NMA supports 
continued funding for the Advanced Pulverized Coal-Fired Power Plant 
program (the low emission boiler system) which builds on the solid 
performance history of conventional pulverized-coal-fired boilers.
    Within the Advanced Research & Technology Program, the NMA supports 
the goal to develop the advanced turbine system, fuel cells, and the 
critical development of cost-effective hot gas cleanup systems. The 
latter will allow gas from the combustion system to be cleaned without 
lowering temperature and energy level by quenching it prior to clean 
up.
    The cooperative R&D program.--The Cooperative R&D programs with 
industry at the Western Research Institute in Wyoming and the Energy 8 
Environmental Research Center in North Dakota have demonstrated value 
because of their potential for near-term payback through 
commercialization. These cost-shared, private-public partnership 
programs continue to deserve the emphasis placed on them in prior 
years.
    National laboratories.--The Department of Energy should continue 
and expand its emphasis on making maximum use of its existing research 
facilities, including those national laboratories which traditionally 
have not been highly active in fossil energy. In 1990, the National 
Coal Association (now the National Mining Association) took the 
initiative to create a more effective partnership between the coal 
industry and researchers with the National Laboratories at Argonne, Los 
Alamos, Oak Ridge and Sandia, in addition to the Morgantown and 
Pittsburgh Energy Technology Centers. The partnerships' continuing 
mission is to stimulate, facilitate and coordinate the development and 
transfer of technology to the mining industry through technical 
information interaction and applications evaluations.
    Extraction technologies.--Extraction technologies are an essential 
part of a research and development portfolio for coal and minerals. The 
NMA urges support for the establishment of such a program within DOE's 
Office of Fossil Energy in partnership with the mining industry.
    Fossil energy environmental restoration.--The NMA is an active 
partner in the Acid Drainage Technology Initiative (ADTI) at the 
National Mine Lane Reclamation Center (NMLRC) and supports funding in 
the amount of $1.5 million. This action will provide necessary support 
for the NMLRC to implement this joint partnership effort to reduce the 
formation of acid pollutants that can drain into streams and rivers 
when coal is mined.
                   energy information administration
    In addition to its value to the nation, the functions performed by 
the Energy Information Administration (EIA) are of significant 
importance to the mining industry. EIA is an independent agency whose 
unbiased analysis and independent short and long term forecasts form 
the basis for reasoned and responsible policy decisions by the 
Congress, the Department of Energy and other government agencies on 
both the federal and the state levels. EIA's energy data collection and 
dissemination responsibilities are essential to our industry's ability 
to evaluate production and market trends, and to make investment 
decisions which benefit the nation. NMA urges the Subcommittee to 
reject the reductions proposed for the EIA.
                         u.s. geological survey
    Federal investments in geoscience research and information have for 
decades paid enormous dividends, and the rationale for continued 
support of geosciences remains strong. For example, there is a 
demonstrated need for an integrated national effort to provide 
information about natural resources and geologic hazards. The Geologic 
and Groundwater Divisions of the USGS develop and provide high quality 
and scientifically reliable data that is important to maintaining our 
nation's economic and environmental health in addition to national 
security. The U.S. Geological Survey (USGS) addresses development of 
natural resources, prepares geologic maps utilized extensively in both 
the public and private sectors, in addition to maintaining healthy 
water standards.
    Of particular Importance is the maintenance of the data development 
functions transferred from the former Bureau of Mines (BOM). The USGS 
is the only source for much of the statistical information on mining 
and minerals commodities and the NMA strongly advocates the 
continuation of these data collection and dissemination activities. 
While this activity is quite different from other USGS activities, the 
transfer has been effective to date. However, the NMA remains concerned 
that USGS may attempt to eliminate or reduce these important functions. 
The data is very important as it forms the basis for informed policy 
decisions by government and is also used extensively by industry, non-
governmental organizations and academia.
                        office of surface mining
    The Office of Surface Mining's (OSM) Regulation and Technology 
appropriation should be evaluated in light of the maturation of 
approved state surface mining programs since the passage of the Surface 
Mining Contra and Reclamation Act (SMCRA) in 1977 which has made 
federal duplication of state responsibilities under the Act unnecessary 
and wasteful. In spite of a reduction in appropriations in 1996, OSM 
still maintains 20 field and area offices in addition to the 
Washington, D.C. Headquarters, the Lexington, Kentucky AVS Office and 
three Regional Coordinating Centers that were created pursuant to the 
agency's 1994 Streamlining. That is a total of 25 federal offices for 
26 coal mining states, 24 of which have federally approved state 
programs. In 1995, OSM consolidated the Springfield, Illinois and 
Indianapolis, Indiana field offices with no resulting gaps in 
environmental protection. The necessary functions of field and area 
offices not already assumed by the states can be consolidated with most 
of the functions accomplished by the three Regional Coordinating 
Centers.
    State program grants, technical information processing systems, 
training of state personnel, review of state program amendments and 
electronic permitting activities should continue and can be effectively 
administered through a streamlined structure.
    With respect to Title IV (Abandoned Mine Land) programs, over a $1 
billion balance exists in the Abandoned Mine Land (AML) Fund which is 
financed through the AML tax paid by the industry on each ton of coal 
produced. NMA supports an increase in the amount of money available for 
states and OSM to produce actual On the ground reclamation of lands 
mined prior to the passage of SMCRA.
              bureau of land management and forest service
    National Mining Association (NMA) members are engaged in extensive 
exploration for and development of minerals on public lands. These 
lands are a cornerstone of the nation's mining industry. The NMA is 
concerned that the Bureau of Land Management (BLM) and Forest Service 
(FS) lack sufficient qualified personnel expertise and funding to 
conduct timely mine permitting. This is resulting in significant 
economic and social impacts.
    NMA's members are committed to environmentally responsible mining 
activity on public lands and are committed to working closely with the 
BLM, Forest Service and the states in the planning stage to assure that 
mining projects meet environmental standards and objectives. To do 
otherwise would lead to increased costs both to industry and the 
Federal government.
    Mining operations on public land generate taxes and employment and 
in many cases are the dominant source of employment in many rural 
communities. Delays in approval for mining plans have a negative effect 
on these communities. An adequate minerals budget will help assure 
timely, up front and cooperative efforts between the land management 
agencies, the states and the mining industry.
    BLM and the Forest Service must have highly qualified and trained 
personnel with expertise in mineral exploration, development and 
production techniques to perform this ``up front'' work. The NMA urges 
the Subcommittee to provide adequate funding so that processing of mine 
operating plans, including National Environmental Policy Act (NEPA) 
compliance, can proceed in a timely manner. This would go far to 
alleviate an ongoing problem of major significance.
    Late last year, the Secretary of the Interior reported to this 
Subcommittee that its directive on processing grandfathered patent 
applications Will also mean that these [mineral] examiners will not be 
available to do other types of work [processing plans of operation] 
typically done by these geologists and mining engineers. Given this and 
other constraints, the industry was surprised by the Secretary's 
announcement early this year of a new major initiative to revise BLM's 
surface management regulations applicable to mining. The allocation of 
staff and financial resources to this major new initiative will further 
exacerbate ongoing delays in the timely processing of plans of 
operation and related NEPA requirements. NMA encourages the 
Subcommittee to scrutinize this new initiative which does not appear to 
be responsive to any specific problems that would warrant wholesale 
revisions of the existing regulatory regime. The prioritization this 
initiative has apparently been assigned must be questioned.
                                 ______
                                 

          Prepared Statement of General Electric Power Systems

    This testimony is submitted on behalf of General Electric Power 
Systems (GE) for consideration by the Subcommittee during its 
examination of the funding requested for fiscal year 1998 for programs 
of the Department of Energy. GE supports funding through the Fossil 
Energy Research and Development program for the Advanced Turbine 
Systems (ATS) program in the amount of $45.379 million in fiscal year 
1998. This amount includes $31.379 million as included in the 
Department's budget request, which is necessary to provide funding for 
the completion of the ongoing Phase 3 of the program, plus an 
additional $14 million. This amount above the Department's original 
request is necessary to initiate a restructuring of the utility ATS 
program that was formally requested by the Department on March 3, 1997, 
and will maintain the program at near the level of funding provided in 
fiscal year 1997.
                 value of the ats program to the nation
    Through the ATS program, the Federal government is sharing with 
industry the risks in the development of the next generation power 
system for utility and industrial applications using advanced gas 
turbines. To date, GE has invested $60 million in the utility ATS 
program. The ATS program is essential to keep U.S. turbine 
manufacturers at the forefront of power system technology, enabling 
U.S. companies to increase exports to the rapidly growing world market 
and sustaining and creating new manufacturing jobs.
    The Federal investment in the ATS program will produce market-ready 
technology that will provide the most energy efficient utility power 
generation option for the future. The benefits of this technology that 
will flow to the taxpayers include savings in energy resources; lower 
electricity costs; substantial emissions reductions; and stimulus for 
domestic jobs retention and expansion.
    The ATS program overlaps with the period of growing international 
markets and transition in the domestic industry. Domestic market 
uncertainty resulting from electric industry restructuring makes 
potential investors in new technologies more risk averse, a trend 
likely to continue until the new ground rules for a more competitive 
electricity industry are set. These developments make properly tailored 
Federally supported R&D more critical. Continuing the ATS program will 
produce commercially available technology at the time when new 
increments of generation are needed, both domestically and 
internationally.
                       status of the ats program
    In 1993, GE was one of three companies competitively selected to 
participate in the Conceptual Design and Product Development phase of 
the utility portion of the ATS program. In August 1995, DOE selected GE 
as one of two companies to proceed to the Technology Readiness Testing 
and Pre-Commercial Demonstration phase (Phase 3) of the program, which 
GE is currently cost-sharing at 64 percent of allowable cost. In 
September 1995, GE executed a Cooperative Agreement with the Department 
of Energy. In view of budgetary limitations, last year GE agreed to 
defer certain Federal funding which, under the Cooperative Agreement, 
would otherwise have been required in fiscal year 1997. This change, 
coupled with the funding provided by Congress, has enabled the ATS 
program to maintain progress toward the program's ambitious technical 
goals, with two contractors, in fiscal year 1997.
    Fiscal year 1997 funding is being used by GE to continue Phase 3 
Enabling Technology design and demonstration for the critical new 
components of the ATS. The funding requested by the Administration for 
fiscal year 1998 will permit completion of the GE Phase 3 technology 
development component of the ATS program, which is currently scheduled 
for completion by the end of calendar year 1997.
    On March 3, 1997, DOE issued a Request for Proposals to the ATS 
contractors for a restructured program. Instead of the original 
demonstration phase of the ATS program, which included the siting of 
the first commercial unit at a host site, the program would be 
restructured to achieve full speed no load testing of the ATS, 
including design, procurement and installation of unique tooling and 
test instrumentation. Replacement of the demonstration phase should 
eliminate the need for the Department to choose a single technology, 
thereby ensuring that DOE will not be put in the position of making 
technology choices that should be market-driven, while assuring that 
the program will still achieve the technical milestones necessary to 
ready ATS technology for successful worldwide commercialization. GE's 
current assessment of the impact of this restructuring on the fiscal 
year 1998 funding requirements is reflected in the request for an 
additional $14 million above the Department's original ATS funding 
request.
                  federal support for the ats program
    In assessing any federal technology program, it is critical to (1) 
identify tangible benefits to the taxpayers; (2) assure that the 
technology to be supported is one that ultimately will be supported in 
the marketplace; (3) assure that the U.S. government does not stand in 
the position of picking technology winners or losers or otherwise 
distorting the marketplace, but facilitates the ability of the market 
to make such choices; and (4) assure that the program is consistent 
with and advances other national energy priorities. Where the public 
benefits will far exceed the cost to the government, Federal 
participation is appropriate. Judged against these standards, the ATS 
program is a cost-effective investment for the nation.
                     tangible benefits to taxpayers
    Energy efficiency.--The goal of the ATS program is to achieve fuel-
to-electricity efficiencies of 60 percent or greater, resulting in 
significant reductions in fuel consumption.
    Lower electricity costs.--These fuel savings will, in turn, lower 
electricity costs. The ATS program has as its goal a 10 percent 
reduction in the cost of electricity produced relative to current (F-
level) combined cycle power plants. Energy cost reductions of this 
magnitude will have a positive impact on the competitiveness of U.S. 
industries in the world marketplace.
    Emissions reductions.--Environmentally superior natural gas fired 
Advanced Turbine Systems will reduce emissions without the need for 
post-combustion controls. Natural gas fired gas turbines produce no 
particulates, ash, heavy metals, toxins, or sulfur oxides. 
Additionally, the ATS will achieve a significant reduction in emissions 
of oxides of nitrogen, and will further reduce carbon monoxide and 
hydrocarbon emissions relative to the current fossil fueled power 
generation base. The high efficiency of gas turbine systems makes this 
power generation concept the most effective method of reducing carbon 
dioxide emissions from fossil fueled electricity generation.
    Stimulating jobs retention and growth.--Tens of thousands of 
Americans already work to manufacture gas turbines and to provide key 
components. These jobs depend on continued U.S. global leadership in 
turbine technology. The turbine manufacturing industry in the United 
States faces competition from foreign suppliers that are heavily 
supported by their own governments in both technology and market 
development. High value manufacturing jobs in this industry already 
have been lost, and the remaining jobs are at risk because of uncertain 
U.S. market conditions and stiff international competition.
    A $1 trillion international market in electricity generating 
systems is expected to develop over the next decade, and much of the 
market demand will be for advanced gas turbine systems. The ability of 
U.S. companies to capture a significant share of this market may well 
depend upon successful completion of the ATS program to assure that 
U.S. technologies will be developed in time to compete to fulfill the 
expected demand for advanced power generation systems after 2000. Taken 
together, the need to counter foreign R&D support for U.S. competitors 
and foreign export promotion activities, and the jobs and economic 
benefits of expanded U.S. exports of advanced power generation 
products, make a compelling case for the continuation of the ATS 
program.
                market opportunities for ats technology
    ATS technology ultimately will be supported in the marketplace, 
both domestically and internationally. But because of the continuing 
technical risks, the market alone is not sufficient to bring this 
technology to the point of commercial acceptance. The likely users of 
this technology in the U.S., both utilities and independent power 
producers, are not in a position today to make multi-hundred million 
dollar investments in technologies and systems that are not yet proven 
by actual, full-scale operation.
    The current discussion of deregulation and increasing competition 
in the electricity industry, including the potential for separation of 
generation and other functions of traditional utilities, makes it even 
more difficult to identify risk takers to go forward with new 
technology. While new technology is a driver for restructuring, and gas 
turbine technology advances are one way to secure the cost-saving 
benefits of competition in the domestic industry, the pressures of 
deregulation also may distort the market, and discourage investments in 
newer, cleaner technologies that have unanswered questions. The ATS 
program is vital to clean, efficient power choices in the U.S. because 
it will enable U.S. manufacturers to demonstrate favorable answers to 
these questions about advanced gas turbines.
            federal role in addressing technical challenges
    Because they offer efficient fuel conversion, short installation 
times and lower installed cost, the current generation of gas turbine 
combined cycle systems has gained wide acceptance. In recent years, 
manufacturers have made upgrades in performance and incremental 
improvements that produce modest gains in turbine efficiency and 
emissions reductions. Moving beyond these incremental improvements, 
however, requires vision, commitment and a public-private partnership. 
The ATS program meets these requirements: it has an ambitious but 
attainable goal of a system that achieves 60 percent efficiency; it has 
the commitment, evidenced through cost-sharing, of the private sector, 
and it involves the government in sharing the technical risks that 
prevent private industry, acting alone, from meeting the ultra-high 
efficiency goal of the ATS program.
    The key to the advancement of gas turbine systems in the future is 
a strong technology base focused in three critical areas: advanced gas 
turbine operating conditions, environmental compatibility, and fuel 
flexibility. From a technical standpoint, achieving the efficiency 
goals of ATS requires thermodynamic cycle modification and changes in 
gas turbine design through innovative cooling and materials 
developments. The multidisciplinary approach of the ATS Program fosters 
sharing of information, expertise, and research facilities, which 
enables American companies to address areas of technical risk more 
quickly and effectively.
              consistency with national energy priorities
    The ATS program will permit greater utilization of domestic natural 
gas resources to meet power generation needs. The more efficiently 
natural gas can be burned to generate electricity, the more competitive 
it will be in the marketplace and the more likely it is that this fuel 
will continue to replace imported oil for electricity generation. This 
enhances U.S. energy security and reduces the outflow of dollars for 
foreign oil. The advanced turbine system will also be fuel flexible. It 
will be applied to coal fired systems (Integrated Gasification Combined 
Cycle) and will result in a significant performance increase and 
emissions reduction compared to conventional coal fired steam plants.
                               conclusion
    The benefits of the ATS for the United States will far exceed the 
Federal funds invested. The ATS program will contribute to continuing 
U.S. global leadership in advanced power generation technologies, 
thereby supporting high value manufacturing and engineering jobs here 
in the United States, both in the systems developers and in their 
network of suppliers from around the country.
    Government and industry have made mutual commitments to the ATS 
program, and have made significant technical progress. GE appreciates 
the Committee's strong support for the ATS program in the past, and 
urges the Committee to provide the resources necessary to see this 
program through to completion in its restructured form.
                                 ______
                                 

Prepared Statement of Dr. Maxine Savitz, General Manager, AlliedSignal 
                           Ceramic Components

    On behalf of AlliedSignal Inc., I am pleased to provide written 
testimony concerning recent ceramic gas turbine activities at 
AlliedSignal. Although AlliedSignal is a large, multi-national advanced 
technology and manufacturing company serving customers worldwide with 
aerospace and automotive products, chemicals, fibers, plastics and 
advanced materials, AlliedSignal Ceramic Components (ASCC), is a 50-
person unit. AlliedSignal Ceramic Components has a goal to develop and 
manufacture viable high performance structural ceramics for automotive, 
advanced industrial and aerospace applications. Ceramic engine 
components are essential for the application of gas turbine engines as 
effective power sources for ground vehicles in order to meet 
performance, weight and life requirements. The ceramic gas turbine 
programs in the transportation and industrial Energy Efficiency 
programs at the Department of Energy (DOE), which this committee has 
supported, have made much progress in showing the performance and 
reality in a gas turbine environment.
    We are requesting continued funding in fiscal year 1998 for the 
Transportation Propulsion Materials Program at the fiscal year 1997 
appropriated level of $6.5 million instead of the fiscal year 1998 
request of $4.25 million. It is also important to fund the other 
ceramic programs in the transportation and industrial programs at the 
fiscal year 1998 requested level. This includes Vehicle Systems R&D 
(Heat Engines R&D) High Temperature Materials Laboratory, Cogeneration 
(ATS) and Continuous Fiber Ceramic Composites programs.
    The critical activity in the Partnership for a New Generation of 
Vehicles (PNGV) gas turbine effort in fiscal year 1998 is the 
development of ceramic manufacturing technology for gas turbine 
components. The recently released Review of the Research Program of the 
Partnership for a New Generation of Vehicles Third Report by the 
National Research Council (April 1997), states ``The single most 
critical component yet to be demonstrated is a suitably sized, 
efficient, ceramic turbine, capable of being mass produced. The 
committee found that significant progress has been made by Kyocera-
Vancouver and AlliedSignal Ceramics in making high-quality ceramic 
components with complex shapes and using processes with high potential 
for scale-up to automotive volumes and cost. Extruded regenerator 
rotors, integral turbine rotors, and scrolls have all shown new 
capabilities which, although beset by tooling and startup yield 
problems, have produced quality engine parts and have supported 
successful component durability demonstrations. Previously, precision 
silicon-nitride parts were made by hot isostatic pressing, which is 
impractical for large-volume production. Today, laboratory-scale parts 
can be produced in 10 minutes using a gelcast process, a much better 
time frame than the 8 hours required by the previous procedure. 
However, yield and consistency for this process have yet to be 
established. Some silicon-nitride components have been manufactured 
using this process and have been installed on an experimental basis in 
engines running at metal temperatures (approximately 2,000 +F), 
primarily to improve wear.''
    As a result of collaborative efforts between industry, government, 
and national laboratories--particularly Oak Ridge National Laboratory 
(ORNL)--significant advances in ceramic engine design and silicon 
nitride material and fabrication technologies have been achieved. A 
number of silicon nitride components are being evaluated and actually 
being implemented in gas turbine applications.
    AlliedSignal Ceramic Components is currently in production with 
three silicon nitride aerospace parts: components for air turbine 
starters, auxiliary power unit oil pumps and, just this month, seal 
runners for turbofan main engines. The oil pump parts are used on U.S. 
and foreign commercial aircraft such as the new Boeing 777 and Airbus 
A330/340; the seal runners are being installed on engines which power 
business jets such as Citation, Learjet, Falcon. About 2,000 parts per 
month are now being manufactured. During the three years the gerotor 
rings have been in production, cost to manufacture these parts have 
been reduced 10-fold; yields have increased from 47 percent to 90 
percent. Quality has been excellent. Every Airbus has been retrofitted 
and all Boeing 777s use the ceramic gerotor rings, as will the new 
737s. These and the seals are examples of the achievements of ceramic 
engineers at AlliedSignal Engines who have participated in the DOE 
ceramic ATTAP and Ceramic Engine Demonstration project, and who are 
familiar with the design, test, and advantages of ceramics. As a result 
of knowledge in materials and fabrication experience from the Engine 
Programs and the ORNL Ceramic Technology Programs, AlliedSignal Ceramic 
Components was able to provide these parts in a short time, as an 
example, 20 days. The production decision was made within 4 months 
including rig and engine testing.
    Within the next two years, model 85 APU ceramic turbine nozzles 
will be introduced into existing military ground carts followed by the 
commercial airlines. The nozzle program, funded as an DARPA insertion 
program and by AlliedSignal Engines has completed 46,530 accumulated 
hours and 54,230 starts. There are over 7,500 hours on the high time 
engine. Ten 85 APU's have been fielded on MD-80's and are flying in 
commercial service and have completed 23,690 hours and 38,635 starts 
and four military carts have been fielded. An internally funded program 
between AlliedSignal Engines and AlliedSignal Ceramic Components to 
reduce the costs of manufacturing the 85 APU nozzles, so that the 
military will more easily afford them, has reduced the costs 76 
percent. Ceramic turbine nozzle technology will also see application in 
a new commercial air transport APU. The technology for design, testing 
and ceramic manufacturing for this application is sponsored by DOE. The 
331-200 commercial field test will provide customer confidence and 
demonstrate improved reliability in 767/757 applications. These 
insertion efforts thus provide clear benefit--reliability, durability, 
and customer acceptance.
    Introduction of a new material such as ceramic components in 
aerospace applications provides experience in manufacturing, customer 
confidence, acceptance. As mentioned, costs are being reduced but are 
still too high for most automotive and industrial applications. Gas 
turbines, because of their temperature capability, have the potential 
to achieve fuel efficiency targets while preserving low emission 
characteristics. Ceramics have been identified as a major enabling 
technology and allow the gas turbine to meet the goals of a hybrid 
vehicle or advanced turbine systems for industrial applications. Cost 
of ceramic components is the major impediment to commercialization. At 
present, ceramic components range from ten to several hundred times the 
cost of their metallic counterparts. They currently are far too 
expensive for large scale, high volume use. Engine builders and vehicle 
manufacturers expect ceramic hardware to cost no more than conventional 
materials. This represents a significant challenge to the structural 
ceramic industry. To achieve parity, substantial cost reduction in 
every facet of ceramic component manufacturing is necessary.
    In fiscal year 1994, a multi-year, cost shared program was 
initiated by AlliedSignal Engines as part of the DOE Ceramic Turbine 
Engine Demonstration Project with two ceramic suppliers. The objective 
is to improve manufacturing processes for ceramic turbine engine blades 
and nozzles and demonstrate the application of these processes to a 
production environment. Each supplier has implemented a focused 
strategy to meet annual yield, cost, and delivery goals for 
introduction of ceramic gas turbine components in commercial auxiliary 
power units (APU). Although the blades and nozzles being fabricated 
under this program are for AlliedSignal Engines' evaluation in a 
production environment, the technologies developed are applicable to 
structural ceramics as used in the Solar industrial gas turbine, 
Allison and Teledyne hybrid engine and other hybrid gas turbine power 
plants. The silicon nitride material (AS800) being used by AlliedSignal 
Ceramic Components is being used on all the gas turbine programs.
    The funding AlliedSignal Engines received in fiscal year 1997 will 
enable them to successfully complete the program. Over 2000 cumulative 
hours of 331-200 ceramic nozzle engine testing has been completed with 
over 5335 starts. An additional 750 hours of engine testing is planned 
this year, with FAA certification/approval for field testing planned in 
June 1999. Ceramic blades have completed over 290 hours of successful 
engine tests and will accumulate an additional 700 hours in 1997. The 
complimentary ceramic manufacturing program will obtain process yield 
of 75 percent and show manufacturing capacity of 500 parts per month. 
The basic process and material is the same as for automotive 
components. Forming process is driven by quantity.
    The AlliedSignal Engine program also provides input to the DOE, 
Office of Industrial Technologies Advanced Turbine Systems (ATS) 
ceramic engine program being conducted by the Solar Turbine Co. These 
two programs share non-proprietary technology data. As a result of the 
DOE sponsored manufacturing and scale-up tasks, AlliedSignal Ceramic 
Components is providing silicon nitrate blades for the Solar gas 
turbine. These parts have been successfully tested. AlliedSignal 
Ceramic Components is also providing prototype parts for Allison Engine 
Company for its Hybrid Vehicle Turbine Engine Program and its Advanced 
Turbine Systems Program. In addition, AlliedSignal Ceramic Components 
is participating in a cost-effective Continuous Fiber Ceramic 
Composites (CFCC) program with Caterpillar Inc. All of these programs 
have been planned to provide important steps to meeting the goal of 
engine quality parts. Manufacturing processes suitable for aerospace 
and stationary gas turbine quantities of components are being developed 
as an intermediate stop toward processes suitable for automotive 
quantities of components.
    To serve the needs of PNGV, there must be a transition from low 
volume to high volume products with a further reduction in costs. In 
March 1997, DOE announced its plan to issue a Program Research and 
Development Announcement (PRDA) for development of high efficient 
ceramic gas-turbine hybrid power units (GT-HPU) for hybrid-electric 
automotive applications. Phase I will develop and demonstrate high-
volume, high-yield, cost effective ceramic manufacturing technology for 
automotive gas turbine components. The funding for the program would 
come from the Automotive Propulsion Systems Material and Heat Engine 
R&D portions of the Office of Transportation Program.
    As mentioned, the proposed fiscal year 1998 budget reduces the 
Automotive Propulsion Systems Material budget form $6.5 million (fiscal 
year 1997) to $4.25 million (fiscal year 1998). The President's budget 
does not provide sufficient funding to develop the manufacturing 
technology for the three critical components: recuperator, combustor, 
and rotor. These three components are very different in design, 
materials, and manufacturing method. The President's budget will allow 
only one contractor and one component. The result will be insufficient 
data to make the go/no-go decision on the turbine option for PNGV.
    If the $2.25 million cut in the ceramic gas turbine program were 
restored, one or more additional contractors would be included in the 
program and all three critical gas turbine components would be 
included. Core supporting technology development programs at Oak Ridge 
National Laboratory would be maintained with the increase in funding.
    The Oak Ridge National Laboratory-led Ceramic Technology Project 
has been a unique partnership between government and industry to 
develop ceramic technology for advanced gas turbine engines. U.S. 
industry is developing manufacturing processes while national 
laboratories and universities are performing supporting technology 
efforts that are synergistic with the industry programs. In many cases, 
very effective teams have been established between ORNL principal 
investigators and industry participants. The ORNL inventor of 
gelcasting is spending a two year assignment at AlliedSignal Ceramic 
Components, helping to scale up and automate the process. The ORNL 
principal investigator for ceramic joining is working with Teledyne 
Ryan to develop a process to join Teledyne's ceramic turbine rotor to a 
metal shaft. ORNL and UDRI have led the nation in developing testing 
technology for high-temperature ceramics, and continues to develop the 
engineering data on commercial ceramics that are required by designers 
of ceramic gas turbine components. This information is critical not 
only for transportation applications but also for Advanced Turbine 
Systems Programs at Solar Turbines, Westinghouse, and Allison-Engine 
Company. ORNL and Boston University have worked with AlliedSignal 
Engines to develop a corrosion-resistant ceramic coating for ceramic 
gas turbine components, and are developing cost-effective methods of 
applying the coating. ORNL and UDRI are working with DuPont-Lanxide 
Composites and Teledyne Ryan on the development of critical ceramic 
recuperator material.
    The $2.25M reduction in the Automotive Propulsion Systems Material 
budget will not only reduce the needed industry effort in ceramic 
manufacturing, but will greatly reduce the supporting technology 
programs at national laboratories and universities as well. The funds 
reduction will result in the loss of six scientists at ORNL, the 
University of Michigan, and the University of Dayton and a 30-50 
percent reduction in gas turbine materials efforts across the board 
including gelcasting, tensile testing, joining and DOE.
    We realize, however, that these are times of reduced government 
spending, so your decisions have become more difficult. In that vein, 
one important point needs to be made--at least from AlliedSignal's 
point of view--that is that we're investigating in the development of 
ceramic components concurrent with the investment we've asked this 
Subcommittee, the Congress and the Department of Energy to make. Over 
the past several years, AlliedSignal has invested over $35 million in 
the development of the technology and manufacturing processes necessary 
to keep pace with the international competition in this area. So, while 
we still ask for a modest level of government funding we, too, continue 
to spend our own resources on ceramics and ceramic production.
    An advanced manufacturing facility was constructed for AlliedSignal 
Ceramic Components in 1992. The 30,000 sq. ft. facility located in 
Torrance, California has state-of-the-art equipment for fabrication and 
characterization of structural ceramics. Additional capital equipment 
is added annually, e.g. our machining capability has doubled in two 
years. Funds are provided, not only for ``real cost shared'' DOE 
contracts, but also for IR&D at AlliedSignal Ceramic Components, 
AlliedSignal Engines, and the ceramic technology skill base team at 
Morristown, New Jersey.
    The continuing partnership between DOE and AlliedSignal ensures 
there will be a competitive ceramic manufacturer and leading edge 
turbine engine technology in the U.S., which will provide more energy 
efficient power sources, both in the United States and abroad.
                                 ______
                                 

Prepared Statement of Jeff Lundy, State of Mississippi Oil & Gas Board 
                  and Ground Water Protection Council

    Mr. Chairman, thank you for the opportunity to testify today. My 
name is Jeff Lundy and I am with the State of Mississippi Oil and Gas 
Board. The Oil and Gas Board is responsible for all phases of oil and 
gas production as well as re-injection of produced salt water, which 
assures the safety of our ground water supplies. My testimony today is 
submitted on behalf of the Ground Water Protection Council (GWPC).
    The Ground Water Protection Council (GWPC) is responsible for the 
development and operation of the RBDMS system. The GWPC is made up of 
state oil and gas agencies as well as those that regulate ground water 
and other underground injection control programs. Through the GWPC, the 
states are all working together to protect ground water resources while 
reducing the cost of compliance to industry.
    We would like to thank the Committee for supporting $.5 million for 
the Assistance to State Oil & Gas Agencies and the independent oil tic 
gas industry with Risk Base Data Management Systems (RBDMS) last year 
and would urge the Committee to increase funding for RBDMS to $1.5 
million for fiscal year 1998 to expand the system to every oil and gas 
producing state. The system is currently operational in Alaska, 
Montana, Nebraska, Mississippi, North Dakota, and we are installing it 
in Ohio, Alabama and California. Additional funding would allow each 
remaining state to initiate the program as well. This amount would 
provide the smaller independent oil producers access to this 
environmental data management system. Smaller producers are often the 
most in need of such a system because high regulatory costs hit them 
the hardest. In addition to providing the system to smaller producers, 
additional funding will allow the GWPC to expand the system to include 
oil field surface facilities including tanks, pipelines, and storage 
units. Before I go into detail on the how RBDMS works, I want to make 
the point that states are dedicating their own resources to RBDMS. For 
example Ohio, is using almost $600,000 in state dollars to implement 
RBDMS. I know all other states are planning on using state dollars as 
well as federal funds. But what the remaining states need is a 
relatively small amount of start-up assistance after which time they 
have shown they are willing to begin applying their own resources.
    With past assistance from the US Department of Energy, the GWPC 
assembled a project team with extensive knowledge and experience in 
state oil and gas agency environmental data management to develop 
RBDMS, the only comprehensive, fully relational, PC-based oil & gas 
regulatory data management system in the country. By allowing the oil 
and gas industry to participate in the next phase of development of the 
system, we will assure that it will be useful and effective for them. 
Additional funding at $1.5 million for fiscal year 1998 will be 
mutually beneficial to the private sector and the states by keeping 
environmental compliance costs down.
    RBDMS is one of the best examples we have seen of how industry, 
working with government, can improve both industry production and 
environmental protection at the same time. Included with my testimony 
are endorsement letters of RBDMS as an alternative to costly command 
and control regulatory policies. It is supported by both the regulated 
community and the regulators themselves.
    In summary, the increased funding we are requesting will provide a 
means for the successful expansion of the Risk Based Data Management 
System and will provide the following benefits: (1) improve 
environmental protection, (2) less regulatory and compliance costs for 
producers, (3) better state enforcement of environmental regulations, 
and (4) continued oil production. The remainder of my testimony 
provides a more detailed explanation of how we have used prior funds 
and how we would use the requested increase. Due to its length, I will 
submit it for the written record. Thank you for the opportunity to 
appear before you today.
                                 ______
                                 

               Risk Based Data Management System [RBDMS]

              benefits of rbdms to the oil & gas industry
Enhance protection of the nation's ground water
    The RBDMS will provide regulators with information that can be used 
to focus attention and resources, both governmental and industry, on 
those wells that pose the greatest environmental risks. The ability to 
target human and financial resources towards those areas with the 
greatest aisle will result in a more effective and efficient use of 
those resources and a greater level of environmental Protection. In 
addition to the tangible public benefits from enhanced protection of 
the Nation's ground water, the resulting decrease in incidents of 
pollution will also help protect industry's image.
Improve industry access to oil and gas commission data
    Oil & Gas boards and commissions function as a clearinghouse for 
information on wells, geology and production. Exploration geologists, 
producers, and other players utilize this information on a daily basis 
to develop prospects and to more efficiently drill and operate their 
leases. In many oil and gas commissions, the vast majority of well data 
is only available via laborious searches through voluminous paper well 
files. In addition to estimating environmental risk the RBDMS is a 
comprehensive data management system that will answer most oil and gas 
information requests quickly and easily from a computer terminal. More 
readily available data on active, idle, and past P&A'd wells will 
decrease the cost of new discoveries and facilitate the development of 
enhanced recovery projects.
Reduced cost to industry of oil & gas commission operations
    Many state oil & gas boards and commissions operate without the 
benefit of well designed computer systems. As a result, many operations 
that could be automated are performed manually at a much greater cost. 
The RBDMS is an efficient and comprehensive data management system 
designed specifically to meet the needs of state oil & gas commissions. 
It will make existing oil & gas commission personnel more efficient and 
reduce the cost of oil & gas commission operations. The oil and gas 
industry will directly benefit from any cost savings as most oil & gas 
commissions are cash funded with a production-based conservation tax 
paid by operators and producers. Furthermore, the fact that the RBDMS 
will be utilized by multiple oil & gas commissions will save each 
commission the expense of developing its own system.
Decrease time required to process applications
    An on-line database of oil & gas commission data will decrease the 
amount of time commission staff require to research and process 
Applications for Permission to Drill and other applications involving 
re-entry and re-completion. Furthermore, the ability to evaluate 
environmental risk will result in construction and testing requirements 
commensurate with the level of risk.
Facilitate uniform reporting requirements among states
    Operators that work in more than one state are often frustrated by 
the variety of applications and reporting forms used by different 
states. The RBDMS was designed for use in multiple states and during 
the design of the system all participants shared the goal of developing 
a common database, program screens, and reports that would work for all 
participating states. Implementation of the RBDMS in multiple state oil 
& gas commissions will further progress towards the goal of uniform 
application and reporting requirements among states. This will decrease 
costs to operators with wells in multiple states.
Preserve shut-in and idle wells
    Many oil wells are inactive as they cannot economically produce at 
prices that prevail in today's market. Such wells may pose potential 
threats to USDW's, and pressure exists to plus inactive wells before 
they pollute and/or become orphans. While the future for increased oil 
prices is not bright, such wells may have value as possible candidates 
for enhanced oil recovery projects. The Department of Energy is 
currently sponsoring research into cost-effective enhanced oil recovery 
technology; but such technology will only be viable if wellbores exist 
where the new technology can be applied.
    Some inactive wells do pose a threat to USDW's and should be 
plugged, and the RBDMS will assist in pointing out such wells; but the 
system will also assist in objectively evaluating inactive wells that 
pose a relatively low risk of endangering USDW's. Such analysis will 
minimize errors of omission and commission: not plugging wells that 
should be plugged, and plugging wells that should not.
    The RBDMS will maintain an on-line list of all inactive wells 
together with historical Mechanical Integrity Tests, Static Fluid Level 
Tests, and Idle Well Reports. Computer programs will ensure that 
required tests are run and reports received. Inactive wells will not 
become lost and forgotten in a mass of paper files. Such a system will 
improve public confidence in the regulatory process and reduce pressure 
to plug inactive wells with future value.
                                 ______
                                 

 Prepared Statement of Michael P. Kenny, Executive Officer, California 
Air Resources Board; Robert J. Cabral, Supervisor, San Joaquin County, 
Chairman of the Board, San Joaquin Valley Unified Air Pollution Control 
   District; Manuel Cunha, Jr., President, Nisei Farmers League; Les 
  Clark, Vice President, Independent Oil Producers' Association; and 
  Catherine H. Reheis, Managing Coordinator, Western States Petroleum 
    Association on Behalf of the California Industry and Government 
                       Coalition on PM-10/PM-2.5

    Mr. Chairman and Members of the Subcommittee: On behalf of the 
California Industry and Government Coalition on PM-10/PM-2.5, we are 
pleased to submit this statement for the record in support of our 
fiscal year 1998 funding request of $900,000 for the California 
Regional PM-10/PM-2.5 Air Quality Study.
    The San Joaquin Valley of California and surrounding regions exceed 
both state and federal clean air standards for small particulate 
matter, designated PM-10/PM-2.5. The 1990 federal Clean Air Act 
Amendments require these areas to attain federal PM-10/PM-2.5 standards 
by December 31, 2001. If the proposed PM-2.5 standards are adopted, 
they would have to be attained 2-3 years later. Attainment of these 
standards requires effective and equitable distribution of pollution 
controls that cannot be determined without a major study of this issue.
    According to EPA and the California Air Resources Board, existing 
research data show that air quality caused by the PM-10/PM-2.5 problem 
has the potential to threaten the health of more than 3 million people 
living in the region, reduce visibility, and impact negatively on the 
quality of life. Unless the causes, effects and problems associated 
with PM-10/PM-2.5 are better addressed and understood, many industries 
will suffer due to production and transportation problems, diminishing 
natural resources, and increasing costs of fighting a problem that begs 
for a soundly researched solution.
    PM-10/PM-2.5 problems stem from a variety of industry and other 
sources, and they are a significant problem in the areas that are 
characteristic of much of California. Typical PM-10/PM-2.5 sources are 
dust stirred up by vehicles on unpaved roads, and dirt loosened and 
carried by wind during cultivation of agricultural land. Soil erosion 
through wind and other agents also leads to aggravation of PM-10/PM-2.5 
air pollution problems.
    Several aspects of the research are important to federal agencies 
and programs within the purview of the subcommittee's jurisdiction, 
including the Forest Service, the Park Service, the Bureau of Land 
Management, and Department of Energy fossil fuel programs. Based on 
consultation with federal agency officials who work closely with the 
PM-10/PM-2.5 issue in the San Joaquin Valley Region, the Coalition 
requests funding for the following agencies and programs:
    Forest Service ($250,000).--PM-10/PM-2.5 is a highly important 
issue with the Forest Service's Region V, especially with respect to 
the Watershed, Soil and Air Department. Unpaved roads within the Forest 
Service's jurisdiction are a suspected, yet unproven, source of PM-10/
PM-2.5 pollution. These roads include public, private and industry-use 
right-aways, such as those used for fire prevention and logging. 
Consequently, the Forest Service has a substantial stake in the PM-10/
PM-2.5 issue and in research into its causes and remedies.
    Park Service ($100,000) and Bureau of Land Management ($250,000) 
for a total of ($350,000).--The U.S. Park Service and the Bureau of 
Land Management have a similarly substantial stake in the PM-10/PM-2.5 
issue. Park Service officials in the California region are concerned 
about the sources and types of PM-10/PM-2.5 particulate matter, 
including secondary emissions, that are coming into park areas from the 
San Joaquin Valley. There is a need for an assessment of the effect of 
PM-10/PM-2.5 emissions on different elevations of terrain. The Park 
Service is concerned about the transport of Valley emissions into 
outside areas under Park Service jurisdiction, especially as these 
emissions have an effect on vegetation and visibility in park areas. 
Park Service and BLM officials are concerned about the possible 
contribution of prescribed and forest fires on the PM-10/PM-2.5 
problem, as well as the effect of PM-10/PM-2.5 particulate matter on 
human and other animal life, vegetation, land management, and area 
lakes and streams.
    Department of Energy ($300,000).--The Department of Energy's stake 
in the PM-10/PM-2.5 issue falls into at least three categories. First, 
the oil and gas industry is vitally concerned about PM-10/PM-2.5, and 
is a key player in the coalition to address PM-10/PM-2.5 problems and 
the need for this research. Secondly, there are DOE laboratories with 
modeling capabilities that may be able to contribute to research and 
solutions concerning PM-10/PM-2.5. Finally, because of DOE's 
partnership in the Elk Hills gas production facility, DOE is in a 
critical position as a potential contributor to both the problem and 
the solution.
    Improved information on the sources and composition of construction 
emissions is needed to develop accurate PM-10/PM-2.5 emission 
inventories. This study will provide information to better evaluate and 
understand the impacts of construction project emissions to total PM-
10/PM-2.5 loadings in a region. Knowledge of the sources of 
construction emissions will also provide better information for 
evaluating the effectiveness of potential mitigation measures thereby 
minimizing the risk of implementing potentially costly control measures 
which might not be effective.
    The importance of this study on PM-10/PM-2.5 is underscored by the 
need for more information on how the federal Clean Air Act Amendments 
standards can be met effectively by the business community, as well as 
by agencies of federal, state and local government whose activities 
contribute to the problem, and who are subject to the requirements of 
Title V of the Clean Air Act. There is a void in our current 
understanding of the amount and impact each source of PM-10/PM-2.5 
actually contributes to the overall problem. Without a better 
understanding and more information--which this study would provide--
industry and government will be unable to develop an effective 
attainment plain and control measures.
    Our Coalition is working diligently to be a part of the effort to 
solve this major problem, but to do so, we need federal assistance to 
support research and efforts to deal effectively with what is 
essentially an unfunded federal mandate.
    Numerous industries, in concert with the State of California and 
local governmental entities, are attempting to do our part, and we come 
to the appropriations process to request assistance in obtaining a fair 
federal share of financial support for this important research effort. 
In 1990, our Coalition joined forces to undertake a study essential to 
the development of an effective attainment plan and effective control 
measures for the San Joaquin Valley of California. This unique 
cooperative partnership involving federal, state and local government, 
as well as private industry, has raised more than $12 million to date 
to fund research and planning for a comprehensive PM-10/PM-2.5 air 
quality study. Our cooperative effort on this issue continues, and our 
hope is that private industry, federal, state and local governments 
will be able to raise an additional $12 million over the next three 
years to fund this important study.
    To date, this study project has benefited from federal funding 
provided through USDA's, DOD's and EPA's budgets--a total of $8.8 
million in federal funding. State and industry funding has matched this 
amount virtually dollar for dollar. However, notoriously absent as 
funding sources are the key Department of Interior agencies and 
programs previously discussed. As a prime stakeholder in this issue, 
the Department of Interior should do its fair share, and bear part of 
the cost of this vital research.
    The following is a list of PM-10/PM-2.5 research projects which are 
in progress:
Planning
    Development of products for emissions, field monitoring, data 
analysis and modeling.
Technical support studies
    Suitability of data base; Winter/Autumn intensive study; 
micrometeorological parameters; fog formation/dissipation; ammonia from 
soils.
Modeling
    Demonstration of modeling system for application in SIP's.
Data analysis
    Analysis of existing data to aid project planning.
Demonstration studies
    Almond, fig, walnut, cotton, harvesting; unpaved agricultural 
roads; unpaved public roads; unpaved shoulders of paved roads; dairies, 
feedlots, poultry, dry cereal grain.
    For fiscal year 1998, our Coalition is seeking $900,000 in federal 
funding to support the continuation of this vital study by the Forest 
Service ($250,000), the Park Service ($100,000), the Bureau of Land 
Management ($250,000), and the Department of Energy ($300,000) in 
California. We respectfully request that the Appropriations 
Subcommittee on Interior and Related Agencies provide these funds in 
the appropriation bill for fiscal year 1998, and that report language 
be included directing the full amount for California.
    The California Regional PM-10/PM-2.5 study will not only provide 
vital information for a region identified as having particularly acute 
PM-10/PM-2.5 problems, it will also serve as a model for other regions 
of the country that are experiencing similar problems. The results of 
this study will provide improved methods and tools for air quality 
monitoring, emission estimations, and effective control strategies 
nationwide. Consequently, the beneficial results of this study will 
contribute to national policy concerns as well.
    The Coalition appreciates the Subcommittee's consideration of this 
request for a fiscal year 1998 appropriation of $900,000 to support the 
California Regional PM-10/PM-2.5 Air Quality Study.
                                 ______
                                 

 Prepared Statement of Hon. Sharpe James, Mayor, on Behalf of the City 
                             of Newark, NJ

    Newark, New Jersey is a city of great contrasts and great promise. 
Our City is home to one of the fastest growing and convenient 
international airports in the nation, which is easily accessible to an 
unparalleled network of sea, rail and highway connections. Newark is 
also home to five institutions of higher learning, ranging from a fine 
community college to two law schools and a medical school. The park 
system of the city is another important component of Newark's value as 
a commercial, educational, and cultural hub of northern New Jersey.
    Weequahic Park is a 311-acre facility located in a densely 
populated mostly low/moderate income area of Newark, NJ, the Nation's 
third oldest city. The major areas of the park are: (1) several playing 
fields; (2) a 72-acre lake; (3) playgrounds; (4) tennis courts; (5) 
picnic area; (6) paddleball/handball courts; (7) trails; (8) a wide 
variety of open space; and (9) an 18-hole golf course, one of the few 
urban golf courses in the nation. Weequahic Park was designed by 
Frederick Law Olmstead in the 1850's and is the second largest park in 
the Essex County Park System, the oldest park system in the United 
States.
    The park is within Newark's boundaries and borders on Frelinghuysen 
Avenue which takes its name from the long distinguished New Jersey 
family of Congressman Rodney P. Frelinghuysen. Further, the cities of 
Newark and Elizabeth boundary lines were established within Weequahic 
Park, then Waverly Fair Grounds, in 1668, two years after Newark became 
a city.
    Over the past two decades or more, Essex County, the owner of the 
park, substantially reduced its maintenance support, and as a result, 
every aspect of this once-splendid park fell into substantial 
disrepair. The once beautiful system of trails became overgrown 
creating a haven for criminal activity, and the park's lake, which in 
the past provided recreational boating and fishing, became choked with 
algae.
    In 1992, a group of park users came together to form Weequahic Park 
Association, Inc. (WPA), which is modeled after and received a generous 
amount of support from the highly successful Central Park Conservancy 
in New York City. The community-based people working effectively with 
the management team, has been the key to WPA's success to-date, i.e. 
grass roots people do grass roots work, and professionals do the 
professional work. In order to supplement the resources provided by 
Essex County for use in Weequahic Park, and to play a hands-on 
management role, WPA formally entered into a partnership agreement with 
the county in 1995.
    Also, WPA participated in the city of Newark's last Empowerment 
Zone application submission, as one of eight (8) ``area coordinators.''
    Following are some of the key accomplishments of WPA since 1992. It 
should be noted that these accomplishments were made without an 
administrative budget. Our estimate of the investment made in Weequahic 
Park associated with WPA's accomplishments (including ``sweat-equity'' 
and ``in-kind contributions'') is in excess of $5 million and growing.
    WPA's Accomplishments: Developed organizational structure; 
articulated key goals and objectives; recruited management team; 
incorporated and secured federal tax-exemption; negotiated partnership 
agreement with Essex County; planned and managed two Labor Day weekend 
festivals; functioned as Empowerment Zone ``Area Coordinator''; 
conducted general park management planning; conducted park clean-up 
projects; collaborated with international, national, and local private 
entities to partner with WPA on specific park projects; developed 
Foundation Board; developed proposal to do a masterplan study; 
requested and received proposals from architects/engineers for 
participation in the masterplan study; new roadways throughout the 
park; two state-of-the-art playgrounds; restoration of fieldhouse/
visitors' center; convened WPA meetings in various properties 
surrounding the park; caused lake to be treated and stocked with fish; 
submitted several projects (with budgets) to the county for funding; 30 
new park ``awareness signs'' are being installed; eight WPA members 
scheduled for summer employment; and major foundation to undertake 
entranceway beautification project.
    WPA strongly feels, and we concur, that they are at the point of 
reaching ``critical mass'' in their development. The president of WPA, 
Wilbur J. McNeil, has made such a positive impression on the county of 
Essex that they have appointed him to a county committee to make 
recreational policy.
    The most immediate WPA projects are to: (1) continue showing 
physical improvement within and outside the park and thereby attract 
and involve more indigenous community participation; (2) continue to 
build the management team; (3) attract more local institutions (e. g. 
local school district, hospitals, churches, etc.) to have their 
constituents to use the park consistent with their goals and 
objectives; (4) raise funds and undertake the masterplan study; (5) 
raise funds to implement the masterplan study thereby upgrading the 
quality of open space with both passive and active recreational 
opportunities within Newark; (6) provide employment and economic 
opportunities within and around the park for members of the community; 
and (7) reduce crime.
    An appropriation of $3.5 million is hereby requested to accomplish 
a broad range of initiatives, including the completion of the 
masterplan, park maintenance above the level currently provided by 
Essex County, the upgrading of the lake in order to return it to a 
state usable for boating and fishing and the restoration of trails, 
landscaping and horticultural features. The masterplan will include a 
fundraising component, to involve the private sector and foundations in 
the continued restoration of this historic and invaluable urban asset.
                                 ______
                                 

   Prepared Statement of the City of Gainesville, FL, Regarding the 
          Sweetwater Branch/Paynes Prairie Stormwater Project

    Mr. Chairman: On behalf of the City of Gainesville, Florida I 
appreciate the opportunity to present this written testimony to you 
today. The City of Gainesville is seeking federal funds in the fiscal 
year 1998 Interior Appropriations bill, in order to assist our efforts 
to protect the Floridian aquifer from stormwater runoff. In particular, 
we are hopeful that the Subcommittee will provide the City with $2 
million to implement an engineering study.
    In Gainesville, the Sweetwater Branch basin contains approximately 
1,710 acres and is located in the southeast central portion of the 
City. The outfall from this basin discharges into Paynes Prairie, a 
state owned preserve and park system, which eventually flows into the 
Alachua Sinka, natural sink hole that drains directly into the 
Floridian Aquifer. This Aquifer provides the majority of drinking water 
to Florida's a residents and has a direct impact on Florida Everglades.
    The Sweetwater Branch drainage basin contains urban, commercial, 
industrial, and residential area stormwater runoff. Because the branch 
runs through some of the oldest portions of Gainesville, most 
stormwater runoff is directly discharged into the Branch with very 
little flooding attenuation or pollution loading reduction. The runoff 
has the potential to affect threatened and endangered wildlife such as 
the Bald Eagle, the Woodstork, the Florida Sandhill Crane, and the 
Southeastern American Kestrel. In addition, many domestic water wells 
are used to obtain water from surficial and intermediate aquifers in 
the area. In summary, the situation has created a concern amongst 
environmentalists, business leaders, and concerned citizens throughout 
the region that Paynes Prairie and the Florida aquifer are being 
compromised.
    With this in mind, the City of Gainesville, Alachua County, St. 
Johns River Water Management District, Florida Department of 
Environmental Protection and local citizens are all seeking a 
comprehensive ecosystem management solution to the problem of 
stormwater runoff from downtown entering Sweetwater Branch, Paynes 
Prairie, and the Alachua Sink. The project devised by these groups 
would reduce or eliminate the sediment, debris, nutrients and general 
pollutants currently being discharged. Current projections are that the 
project would consist of the following three components: The purchase 
of undeveloped property in the vicinity of State Road 331 and 
Sweetwater Branch; the construction of maintainable sediment and debris 
removal systems; and the construction of maintainable nutrient removal 
systems.
    An in-depth engineering analysis of the creek system, property 
topography, associated wetlands, and other pertinent factors is needed 
to determine the optimum and appropriate scope of property purchase and 
facilities construction. The City is prepared to pay some of the cost 
for this analysis, but we are simply unable to bear the entire burden. 
As a result, we request that the Subcommittee appropriate $2 million to 
assist our efforts. Once the project construction is complete, 
Gainesville Stormwater Management Utility, a public utility, would 
provide the required annual maintenance for the facility and no federal 
maintenance funds would be needed.
    This is a critical and much needed project for the City of 
Gainesville, as well as the entire State of Florida, and we 
respectfully ask the Subcommittee for its consideration of the 
Sweetwater Branch/Paynes Prairie Stormwater Project.
                                 ______
                                 

 Prepared Statement of Karen Werbelow, Executive Director, Foundation 
                     for North American Wild Sheep

    Mr. Chairman and members of the Subcommittee, please accept the 
following testimony for the Forest Service and Bureau of Land 
Management proposed fiscal year 1998 Budgets from The Foundation for 
North American Wild Sheep.
    The Foundation for North American Wild Sheep, is a non-profit 
conservation organization with 7,000 members nationwide. We are deeply 
concerned by the current trend to reduce budgets for the Forest Service 
and the Bureau of Land Management, specifically for fish and wildlife 
management including cost share programs. Since fiscal year 1993, we 
have witnessed the steady decline of wildlife habitat management 
budgets. We respectfully ask for your attention to the details of these 
important matters of wildlife conservation.
                    the challenge cost share program
    The Challenge Cost Share Program provides opportunities for 
wildlife management and research in conjunction with the Forest 
Service, the Foundation for North American Wild Sheep and other 
conservation organizations. The success of these partnerships have 
allowed additional funding for Forest Service. Frequently, state 
wildlife agencies will also participate. Specific projects in which we 
are asked to cooperate, include and are not limited to, disease 
research and habitat management. The fragile balance between wildlife 
and multiple use challenges require constant monitoring by wildlife 
professionals. For the past three years, the Forest Service budget 
along with key personnel needed by the conservation community and vital 
to our partnership programs have slowly been reduced. The staff 
biologists, technical assistants and field personnel employed by the 
Forest Service are the driving force behind this program. Since fiscal 
year 1993, the fish and wildlife management programs have been 
jeopardized by funding cuts. Qualified field biologist and other staff 
have slowly been phased out. Without these personnel, many current and 
future projects are being eliminated. New partnership programs will 
eventually be non-existent. Consequently, wild sheep and other native 
wildlife in the United States are being severely affected.
    We support an increase in budget funds for the Challenge Cost Share 
Program. This would allow projects such as ``Movements and Habitat Use 
of Bighorn Sheep Along the upper Yellowstone River Valley'' to 
continue. The three year study, funded by the Challenge Cost Share 
Program, provided invaluable information about bighorn sheep survival. 
This information will be used to design and implement successful 
management programs throughout Montana. The benefits to all wildlife 
would be realized by the simple increase of wildlife biologists and the 
seasonal personnel employed. This will allow for the continuation of 
baseline data collection, necessary for overall ecosystem health and 
management, and the implementation of programs such as prescribed burns 
and the monitoring of wildlife and its habitat. An increase in the 
Challenge Cost Share program would encourage problem solving by 
addressing the needs of wildlife and habitat before a species faces 
endangerment. Sound scientific management depends on a professional 
workforce suited to meet the needs of the wildlife and current public 
demands.
                             land resources
    Proper rangeland management is vital to the health of all species, 
wild or domestic. The Foundation for North American Wild Sheep supports 
the $2.8 million increase to the Bureau of Land Management, 
specifically for management of Wild Horses and Burros. Achieving a 
balanced management level of wild horses and burros is critical to the 
desert bighorn sheep. The previously inadequate budget for the 
Strategic Management of wild horses and burros has caused degeneration 
of rangeland habitat crucial for the survival of the desert bighorn 
sheep, and other native wildlife populations.
    In conclusion, we ask you to strongly consider the benefits of 
increased fish and wildlife budgets to the American people. Wildlife 
biologist are just discovering the how's and why's of ecosystems. 
Research of established healthy populations of wildlife is as important 
as the research of the diseased populations. Maintaining the health and 
vitality of wildlife populations ensures future generations the 
opportunity to enjoy the heritage of America's great outdoors.
                                 ______
                                 
 Letter From R. Dean Tice, Executive Director, National Recreation and 
                            Park Association
                                     Arlington, VA, April 15, 1997.
Hon. Slade Gorton,
Chairman, Subcommittee on Interior and Related Agencies, Committee on 
        Appropriations, U.S. Senate, Washington DC.
    Dear Senator Gorton: This letter urges the Subcommittee to begin 
the restoration of public partnerships by appropriating funds for Land 
and Water Conservation Fund state assistance and the Urban Park and 
Recreation Recovery Program. Consistent with the early history of the 
program, LWCF state assistance should approach one-half of total LWCF 
appropriations for fiscal year 1998.
    We also urge the Subcommittee to give fullest consideration to 
appropriations for the Federal Lands-to-Parks program. This program 
provides technical and planning assistance to state and local 
governments to obtain surplus federal lands for park and recreation 
purposes. Since fiscal year 1996, the program has emphasized assistance 
to those communities impacted by legislated military base closures. 
Nearly 15,000 acres of base closure land have been identified by local 
interests as key acquisition areas for recreation and conservation 
purposes. The continuing potential of this program to contribute to the 
public recreation estate without the need for continued federal 
investment or funds merits your support.
    Previous appropriations for LWCF assistance grants and urban parks 
have resulted in a national legacy. The LWCF authority, for example, 
has provided over $3.2 billion to the 50 states, the District of 
Columbia, Puerto Rico, Guam, the Virgin Islands, American Samoa, and 
the Northern Marianas for planning, acquisition and development of 
recreation opportunities in the United States. Through fiscal year 
1996, a total of 37,300 projects were approved to support acquisition 
of park and recreation resources or development of recreation 
facilities. They are in every geographic region of the U. S., in every 
county and almost all localities. Federal obligations have been matched 
by state and local contributions for a total LWCF grant investment of 
$6.5 billion. States have received about 8,300 grants and counties some 
4,900, while cities, towns and other local agencies matched more than 
24,000 grant awards.
    Of the total number of grant projects, about 10,000 have helped 
states and localities conserve 2.3 million acres of land, including 
combination projects where donated land values matched the cost of 
development. Almost 27,000 projects have been for the development of 
recreation facilities. Seventy-five percent of the total funds 
obligated have gone to locally sponsored projects that provide close-
to-home recreation opportunities readily accessible to America's youth, 
adults, senior citizens and the physically or mentally challenged. In 
addition to thousands of smaller recreation areas, grants have helped 
acquire and develop new areas of statewide or national significance 
such as the Allagash Wilderness Waterway (Maine), Liberty State Park 
(New Jersey), the Willamette Greenway (Oregon), Platte River Park 
(Denver), Herman Brown Park (Houston), and Illinois Beach State Park 
(Chicago).
    Beyond the numbers of projects, acres and dollars, it is important 
to note the LWCF grant program's major effects on the country's overall 
attitudes and policies toward conservation and recreation. Most of 
these less tangible benefits have come about as the result of the 
partnership with states and localities. This type of influence 
continues to the present and the states and local governments have 
shown and continue to show great initiative LWCF has helped to catalyze 
many of these efforts and it can and should continue to do so.
    A further legacy--and a major force for long-term protection of all 
recreation resources--is the provision of Section 6(f)(3) of the Act 
that requires all property acquired or developed with LWCF assistance 
to be maintained perpetually in public recreation use. Consistent 
enforcement has developed strong stewardship programs in each of the 
states to help ensure that LWCF's contributions to the national 
recreation estate remain real and accessible to our citizens.
    The job must continue as population increases and land once 
available for recreation is committed to other uses. Our 1995 research 
indicated that local park and recreation agencies require a national 
total of $27.7 billion in capital investment for rehabilitation, land 
acquisition and new construction. Localities expect to have less than 
half that sum available. While the total estimated need is down from 
$30.4 billion projected from a previous five-year survey, the expected 
budget shortfalls increased by seven percent. Therefore, it is possible 
that the lower total for 1995-99 reflects reduced expectations as well 
as, or instead of, a real decline in needs.
    Construction of new recreation infrastructure ranked highest, with 
a total need of $13.6 billion (49.9 percent) nationwide. For those 
agencies expressing such new construction needs (87 percent), the 
average need per agency was over $3 million, down from $3.5 million for 
the previous five-year period.
    Rehabilitation and restoration needs nationwide totaled $8.8 
billion (32.3 percent). It is important to note that these needs are 
not for ``maintenance'' but reflect major costs for capital renovation 
to correct deficiencies due to age or inadequate design and to increase 
user capacity of existing functional facilities. For those agencies 
expressing a need for rehabilitation investments (76 percent), the 
average need per agency was just under $2.2 million, up from $1.8 
million in the previous survey.
    Land acquisition needs, through both fee simple purchase and less 
than fee approaches, totaled almost $5 billion (17.9 percent). For 
those agencies expressing the need for capital investment in land 
acquisition (52 percent), the average cost per agency was $2.4 million, 
up from the $1.8 million estimated previously. The average number of 
new acres needed rose from 167 to 214. Local governments anticipate (or 
hope) that six percent of their capital needs (almost $1.8 billion) 
would come from federal sources, including but not limited to LWCF.
    Ultimately, the Land and Water Conservation Fund is only in part 
about land and water. It is about what we are willing to invest in 
ourselves and our posterity. The United States contains the wealthiest 
society in the history of the world. Yet we are a nation at risk. We 
have the greatest gap between rich and poor of any modern nation, and 
that gap is still increasing.
    The U.S. currently spends proportionately more for health care--14 
percent of GNP--than any other nation. We are a sedentary nation. 
According to a recent report by the Surgeon General, one fourth of all 
Americans perform almost no physical activity. Nearly half of our youth 
aged 12-21 years are inactive on a regular basis. And only 19 percent 
of our high school students are active for more than 20 minutes five 
days a week--down from 37 percent in 1990. Our population's 
``limitation of activity'' index--a measure of long-term disability--
increased by 45 percent between 1957 and 1989.
    The nation grows in population at an increasing pace. From 1964 to 
1994, we increased from 191 million to 270 million people. As our 
population increases, so has competition for America's natural 
resources, the most important of which is undeveloped land. We are 
losing more and more of our special places to urban and suburban uses 
or to resource extraction. We are depleting irreplaceable biological 
resources--some 3,900 plant and animal species are either threatened 
with extinction or endangered.
    Some argue persuasively that we are witnessing a decline in the 
moral fabric of our society. Violence, crime and gang membership are on 
the rise, especially among the nation's youth. Families, once highly 
influential in determining our direction and values, are often replaced 
by gangs, or if we are lucky, by social workers, teachers and other 
mentors. As communities continue to search for solutions to violence, 
the costs of dealing with crime are draining our public resources. We 
spend on average about $30,000 a year to incarcerate a single juvenile 
offender. The monetary value of saving an at-risk youth has been 
estimated at $1.5 to $2.0 million over his or her lifetime, but note 
that these are reductions in negative costs and do not include the 
``saved'' person's positive contributions to the economy and society.
    These pressing problems have a common link, documented in a wealth 
of research on the economy, human behavior, health and natural 
resources. Over 50 percent of the factors which determine our state of 
health have to do with our environment, our relationships with others, 
our status in the community and how we think about ourselves. Park and 
recreation resources and services help to supply these critical social 
benefits by offering opportunities for most citizens to engage in 
active recreation and to experience healthy relationships with others, 
ourselves and our natural surroundings.
    How much are we willing to invest in essential public recreation 
systems? The Act promises revenues generated by Outer Continental Shelf 
(OCS) resources for the purposes of land and water conservation. A 
serious reevaluation of the continuing diversion of most of those 
revenues for other purposes is needed. We share the view of many in 
Congress that the heavy burdens of national public debt must be 
addressed, and that resource-based income can help diminish budgetary 
shortfalls. We believe, however, that the vision of 1964 is equally 
valid--that present and future generations will also be burdened by the 
failure of today's leaders to invest prudently in capital park and 
recreation resources while we still have viable options to do so.
    Projected fiscal year 1998 OCS revenues are $2.254 billion, 
according to the Minerals Management Service. The LWCF act provides 
that a portion of such annual revenues--for 1998 perhaps $850 million 
of the $900 million authorized by the act--or about 39.9 percent of 
estimated receipts credited to the Fund be available, subject to 
appropriation. The President's proposed budget requests only $160 
million--less than 19 percent of the authorized level and about 7.5 
percent of total estimated receipts. If that budget is enacted, more 
than 92 percent of all OCS revenues for the year will have gone for 
purposes other than the Land and Water Conservation Fund.
    Will this really save us money? In the longer view, equal or 
greater savings could accrue by encouraging regional, state and local 
recreation agencies to more aggressively pursue resource conservation 
and recreation access projects before capital costs escalate and before 
Congress is asked to respond to future ``emergencies'' by considering 
these assets for inclusion in federal land systems. When such 
emergencies occur, the federal government may bear the full fiscal 
burden, not only of higher capital costs for land protection, but for 
development and management in perpetuity.
    While the costs of federal systems may be expected to increase 
consistent with the rate of inflation, they should not be increased 
through inclusion of projects lacking clear national significance. In 
the absence of a serious commitment to provide real incentives for 
systematic investment in partnership programs, piecemeal federal 
actions can be expected to touch randomly on first one site and then 
another, while the bulk of public recreation and resource conservation 
needs that could be addressed comprehensively are ignored. That 
partnership approach is part of the LWCF vision and promise.
    Just as importantly, the results of this fragmented federal 
approach will ignore the clear evidence that most of us seek our 
recreation experiences close-to-home (and put the greatest user 
pressures on close-to-home public resources). This does not diminish 
the values of more remote recreation destinations or the environmental, 
historic and cultural values of places farther away. It does suggest, 
however, that our public policies and investments should recognize that 
both Americans and foreign visitors have always demanded and will 
continue to demand a continuum of destinations and experiences. This, 
too, is part of the LWCF act's vision and promise, and it is precisely 
the role envisioned by its authors for Land and Water Conservation Fund 
grants.
    State and local investments in park and recreation resources (as 
well as all operation and management costs) have been largely borne by 
these governments and their publics. We expect this pattern to continue 
and strongly advocate it. The record also reveals that from 1965 to the 
mid-1980s the national government's reinvestment of a modest amount of 
its resource revenues in state and local projects leveraged immense 
public values and benefits for all taxpayers.
    You are in a position to restore rational investment in an area of 
great national importance. Our organization stands ready and willing to 
work with you, and your staff to realize this goal.
            Sincerely,
                                              R. Dean Tice,
                                                Executive Director.
                                 ______
                                 
  Letter From Elaine M. Stout, President, the Back Country Land Trust
                                        Alpine, CA, April 10, 1997.

Re Land and Water Conservation Fund

Hon. Senator Slade Gorton,
Chairman, Subcommittee on Interior Appropriations,
Washington, DC.
    We strongly urge the Interior Appropriations Subcommittee to move 
swiftly to ensure the success of current conservation plans, which will 
protect both private property rights and endangered habitats, by fully 
appropriating the LWCF.
    In numbers of endangered species and diversity of habitats, San 
Diego County is one of the nation's hot spots. It is also one of the 
nation's fastest growing areas. As the eyes of nation look to San Diego 
County as a model for conservation planning, what is done here will be 
critical for the success of conservation plans in other areas of the 
nation.
    Lands that contain high quality, endangered habitats have been 
identified under the MSCP in San Diego County. It has been estimated 
that it will cost over $300 million to acquire these properties. This 
amount is small compared to the enormous--in perpetuity--benefit that 
can be achieved here.
    Our non-profit organization, the Back Country Land Trust, is 
working cooperatively and closely with local landowners, agencies, 
communities and organizations in our area of service which is affected 
by the MSCP process. The number one concern among all groups--
environmentalists and private property owners alike--is adequate 
funding for properties containing high quality endangered habitats in 
the MSCP planning area.
    We have identified three properties that have all of the following 
criteria and are in critical need for funding: A. High quality 
endangered habitats which contain significant numbers of rare, 
threatened and/or endangered species (red-zone areas in the MSCP 
planning area); B. Under imminent threat of development; C. Willing 
sellers at fair price; D. Significant community and local governmental 
support; E. Vehicle for acquisition/management/maintenance; and F. 
Support by local jurisdictions to accept LWCF funding.
    A description of the properties, their total acquisition costs, 
their dominant habitats and Table 3-5 MSCP species that have been thus 
far observed in each are listed below. The potential for more rare and 
endangered species on each of the properties below is very high.
                wright's field, 365 acres, $2.9 million
    Habitats: High quality California native grassland, Engelmann Oak 
Woodland, Vernal Pools, Diegan Coastal Sage Scrub, Chamise Chaparral, 
Riparian.
    Fauna: Burrowing Owl, nesting Grasshopper Sparrows, San Diego 
Horned Lizard, Golden Eagle, Northern Harrier, Cooper's Hawk, 
Southwestern Willow Flycatcher, Western Bluebird, Mountain Lion, 
Southern Mule Deer.
    Flora: San Diego Thorn-mint.
    Special Significance: Native Grassland is pristine and of statewide 
significance for its high quality, density and unusually occurring 
species on site. Extremely fine clay soils, pools to remain hydrated 
for 5-6 weeks. County's largest population of Chocolate Lily, Palmer's 
Grapplinghook, and possibly San Diego Thorn-Mint. Host plant for Quino 
Checkerspot Butterfly abundant on site.
                fanita ranch, 2,567 acres, $10.7 million
    Habitats: 1,070 acres Coastal Sage Scrub, Grassland, Oak Riparian, 
Oak Woodland.
    Fauna: Large population of California gnatcatchers, estimated at 
38-44 pair, Coastal Cactus Wren, San Diego Horned Lizard, Orange-
Throated Whiptail, Least Bell's vireo, Grasshopper Sparrow, Northern 
Harrier, Cooper's Hawk, Golden Eagle, California Rufous-Crowned 
Sparrow, Mountain lion, Southern Mule Deer.
    Flora: San Diego Barrel Cactus, Willowy Monardella.
    Special Significance: One of the largest populations of California 
gnatcatchers in the MSCP area. Extremely vital, strategic corridor.
                   crestridge, 850 acres, $4 million
    Habitats: Coastal Sage Scrub, Willow Riparian, Oak Woodland, Oak 
Woodland Riparian, Grassland.
    Fauna: San Diego Horned Lizard, Golden Eagle.
    Flora: Lakeside Ceanothus, San Diego Ambrosia, San Diego Nolina.
    Special Significance: Largest known stand of Lakeside Ceanothus. 
Great Horned Owls nest on this site. Several species of oak. Very 
important riparian corridor. Currently within San Diego Wildlife 
Refuge. Development would seriously fragment and split off portion of 
refuge.
    It is estimated that the current MSCP plan in San Diego County has 
over $300 million in acquisition needs. We urge you to earmark a 
portion of LWCF funds for the above important projects in San Diego 
County.
    The most important source of funding for acquisition are the Land 
and Water Conservation Funds. These funds have not always been used for 
conservation purposes. This Congress can do much to rectify past 
abuses, by directing every LWCF dollar to our enormous backlog of 
conservation needs and help to provide a permanent legacy for future 
generations.
            Sincerely,
                                           Elaine M. Stout,
                                                         President.
                                 ______
                                 

   Prepared Statement of Thomas Steinbach, Director of Conservation, 
                       Appalachian Mountain Club

    Thank you for this opportunity to provide testimony to Interior 
Appropriations Subcommittee. I am Tom Steinbach, Conservation Director 
of the Appalachian Mountain Club (AMC)--the nation's oldest recreation 
and conservation organization. I am speaking on behalf of AMC's 71,000 
members to urge your support for fiscal year 1998 appropriations for 
several important, cost-effective Department of Agriculture and 
Department of Interior programs.
    For over a century, the AMC has promoted the protection; wise use 
and enjoyment of the mountains, rivers, and trails of the Northeast. 
Today; a great need-remains for federal land, trail, and river 
conservation funds for the northeastern United States. The greatest 
proportion of the nation's people live, work, and recreate in the 
northeast. The lives and livelihood of these citizens depend on the 
region's clean air and water, and wild areas and open spaces. Yet over 
the past several years, we have witnessed several attempts to severely 
cut back federal funding for land and river protection. As an 
organization of dedicated outdoor volunteers, AMC's 120-year history is 
testament to the power of partnerships between the private and public 
sectors. Funding rollbacks threaten to unravel such partnerships, 
sacrificing the human and financial power that they leverage. It is 
time to reverse this trend.
    The AMC is sympathetic to the need to reduce the budget deficit, 
but the economic, social, and ecological benefits that accrue from our 
nation's land and river protection programs far outweigh their short-
term costs. In the coming year, the AMC urges this Committee to 
continue to invest in the nation's people and environment by supporting 
the following programs.
                    land and water conservation fund
    As the federal government's premier land acquisition program, LWCF 
is critical to the future of many places that Americans treasure. 
Although LWCF has a dedicated revenue source, LWCF funding has fallen 
well below authorized levels. LWCF received its second lowest 
appropriation ever in 1997 at $149 million with no funding going to 
stateside LWCF. Further, in recent years, especially as the state grant 
program has dwindled, the Northeastern United States has not received 
an adequate share of these funds. Given that the greatest proportion of 
our citizens reside in the Northeast, this pattern is especially 
disturbing. In addition, this population is increasing as is the demand 
for recreational services.
                 appropriate $400-$500 million for lwcf
    Today you will receive testimony from a representative of a new 
national coalition working to revitalize LWCF. This new coalition, 
Americans for Our Heritage and Recreation, has brought together 
recreation businesses, conservation organizations, urban interests, and 
state land managers to call for increased appropriations to LWCF for 
both the federal and state sides of the program. AMC strongly supports 
the full list of federal and state-side projects to be submitted and 
noted in the testimony of this new coalition, given by Rindy O'Brien of 
the Wilderness Society. While our ultimate goal is: full appropriation 
of $900 million for LWCF, our short-term goal for both federal and 
state projects total approximately $400 million and represent the 
priorities of a broad array of interests working to provide 
recreational opportunities and a healthy environment for future 
generations. A significant portion of these funds should be directed to 
restore depleted state-side LWCF. All of the projects we mention in the 
body of our testimony are included in the list submitted by the new 
coalition.
    Of particular interest to AMC is the role that LWCF can play in 
protecting the Northern Forest of Maine, New Hampshire, Vermont and New 
York. The Northern Forest Lands Council (NFLC), which was established 
through bipartisan Congressional effort, recommended protection of key 
lands within this 26 million-acre region. The NFLC called on Congress 
to fully fund LWCF and reconfigure Me state grant program to ensure 
that sufficient federal funds can reach the Northern Forest. We.support 
a total LWCF funding request of $17.6 million for Northern Forest 
projects, with $12.9 million targeted for high-priority projects.
    As the Northeast's population grows, increasing pressure is 
building on our remaining forestland in the Northern Forest and 
throughout the Northeast. This trend threatens our forests' ability to 
provide jobs, outdoor recreation, wildlife habitat and timber projects. 
The need for LWCF funds in the Northern Forest--and throughout the 
Northeast--has never been greater.
                         forest legacy program
    The local economies and social fabric of the Northern Forest depend 
on the health and stability of their forests. The Forest Legacy 
Program, designed originally for the Northern Forest states, protects 
forests from inappropriate development while allowing forest management 
to continue. A voluntary partnership among eligible states, the US 
Forest Service, and forest land owners, the Forest Legacy Program is 
now working with eighteen states and one territory.
    The Northern Forest Lands Council recommended that the Northern 
Forest states receive an annual Forest Legacy Appropriation of $25 
million. AMC believes that this figure reflects the true need within 
the Northern Forest. Efforts have been made streamline the Forest 
Legacy program and make it more effective and responsive to land 
owners. We feel this is a positive step and will result in Forest 
Legacy funds reaching more landowners in a timely fashion. We support 
an appropriation of $27.4 million for projects in the Northern Forest 
region, of which $11.8 million is targeted for critical, high-priority 
projects.
          specific lwcf & forest legacy program appropriations
    For fiscal year 1998, we request the following specific LWCF and 
Forest Legacy appropriations. Those projects labeled urgent require 
immediate funding from LWCF to protect them from imminent sale and 
development.
LWCF federal grants
    Urgent.--Sterling Forest, New York, $8.5 million, LWCF. Protection 
of Sterling Forest could be a reality this year given the continued 
commitment of federal, state, and private partners that have worked 
hard to conserve this 17,500 acre gem just 45 miles outside Manhattan. 
Last year Congress passed authorization to purchase Sterling Forest and 
appropriated $9 million of the $17.5 million anticipated federal 
contribution to the acquisition. We urge Congress to ensure completion 
of the Sterling Forest purchase this year by appropriating $8.5 million 
from the Land and Water Conservation Fund. Thisamount will complete the 
$17.5 million federal component to the project and match funds 
contributed by New Jersey, New York, and private donors. New Jersey has 
committed $10 million to the project already. New York has also 
committed $10 million and is expected to nearly double its 
appropriation this year. $5 million has been raised from the Lila 
Wallace Foundation and additional private funds continue to be raised.
    Urgent.--White Mountain National Forest--Lake Tarelton, New 
Hampshire 2000 acres, $2.7 million LWCF.
LWCF State Grants
    Urgent.--Whitney Estate, Adirondacks, New York 15,000-25,000 acres, 
$10 million LWCF State Grant Funds.
    Urgent.--Long Trail, Vermont 1,060 acres, $162,500 LWCF State Grant 
Funds.
Forest Legacy Program
    Urgent.--Fish Creek Watershed, New York 30,00040,000 acres, $5.6 
million Forest Legacy.
    Urgent.--Green River Reservoir, Vermont 6,350 acres, $1.5 million 
Forest Legacy.
    Urgent.--Nicatous Lake, Maine 22,000 acres, $3 million Forest 
Legacy.
    Urgent.--Upper Richardson Lake, Maine 5,122 acres, $1.65 million 
Forest Legacy.
    Pond of Safety, New Hampshire 9,880 acres, $1.5 million Forest 
Legacy.
    Champion Lands, New York 95,000 acres, $6 million Forest Legacy and 
$3 million LWCF State Grant Funds.
    Lake George, New York 400 acres, $1.75 million LWCF State Grant 
Funds.
    Domtar Lands, New York 105,000 acres, $6 million Forest Legacy.
    Mattawamkeag Lake, Maine 4,195 acres, Mattawamkeag River, Maine 
11,281 acres, Moose River, Maine 4,525 acres, $2.1 million Forest 
Legacy.
            appalachian national scenic trail--$7.2 million
    Protection of the Appalachian Trail has made tremendous headway 
under the leadership of this committee. Thanks to your diligent effort, 
only 37 miles of the total 2,158-mile trail remain unprotected. The 
total fiscal year 1998 need for the Appalachian Trail is $7.2 million 
with $4.2 million for National Park Service acquisitions and $3 million 
for US Forest Service acquisitions. We expect that with similar 
appropriations in each of the next three years, that the entire length 
of the trail will be protected by the year 2000.
    rivers, trails, and conservation assistance program--$12 million
    The Rivers, Trails, and Conservation Assistance Program (RTCA) 
provides technical assistance to communities and local organizations on 
river, trail, and conservation projects. For fiscal year 1997 citizens 
made over 400 project requests and NPS staff had funding for only half. 
Additionally, Congress has authorized 10 new heritage areas, most of 
which will fall under RTCA's jurisdiction. Therefore, for fiscal year 
1998, we urge funding for this valuable program be increased by $5 
million as follows: $300,000 increase for management of Wild and Scenic 
Rivers and $200,000 increase for National Trails System (both under NPS 
operations); $1.5 million for the 10 new National Heritage areas, $1.25 
million for technical assistance and heritage program administration, 
$1 million for a new watershed initiative, and $700,000 increase to 
RTCA base funding to enable staff to administer these new programs and 
to accept more project requests (under National Recreation and 
Preservation).
    silvio o. conte national fish and wildlife refuge--$2.1 million
    The Silvio O. Conte National Wildlife Refuge, which spans the 
length of the Connecticut River, is a model of a new federal approach 
to watershed conservation. Over the past two years, the Conte refuge 
has taken hold, with the formation of over 50 partnerships and the 
distribution of two rounds of grant funding to organizations in the 
refuge area. The AMC urges you to support $2 million for land 
acquisition and $100,000 for fish passage studies of the herring 
population, which has dropped to one-twentieth of original levels.
              white mountain national forest--$10 million
    The White Mountain National Forest comprises about 770,000 acres of 
land in New Hampshire and Maine. Over 7 million people visit the area 
yearly. The AMC recognizes the impacts and the service needs of these 
visitors and we support the wide array of multiple uses in the WMNF. 
The current budget does not meet the needs for this magnificent area. 
The AMC urges the committee to support a fiscal year 1998 National 
Forest budget appropriation of $10 million for the White Mountain 
National Forest.
                   acadia national park--$6.5 million
    Acadia National Park draws over 2.9 million visitors every year. To 
provide for the comfort and safety of these visitors, basic park 
infrastructure must meet strict standards. Utilities, restrooms, 
campgrounds and picnic areas are sorely in need of repair and upgrading 
to meet code, to conform to Safe Drinking Water standards, and above 
all, to provide an enjoyable outdoor experience. In addition, Acadia 
includes 44 miles of historic carriage roads whose maintenance since 
1960 has fallen to the National Park Service. These roads represent a 
significant cultural and historic resource and require extensive 
rehabilitation of drainage systems, the road base and surface, and 
stone work. We urge you to support an appropriation of $5.3 million to 
upgrade utilities and facilities, and $1.2 million for rehabilitation 
of the historic carriage roads.
                                 ______
                                 

Prepared Statement of Thomas M. Franklin, Wildlife Policy Director, The 
                            Wildlife Society

    Mr. Chairman and members of the Subcommittee, The Wildlife Society 
is pleased to provide comments on the fiscal year 1998 Budget. The 
Wildlife Society is the association of professional wildlife biologists 
and managers. We were founded in 1936 and dedicated to excellence in 
wildlife stewardship through science and education. We are submitting 
for the record some detailed recommendations for each of the agencies 
listed above. In the past, the Society identified inherent funding 
difficulties in these agencies that have resulted from incremental 
budget cuts, downsizing, and seemingly constant reorganizations. Our 
concerns about these issues remain because more funding and staff 
resources, rather than less, are needed to address the increasingly 
complex biological conditions on public and private lands. However, I 
wish to focus my brief oral comments on a cross-cutting issue that 
affects each of the agencies and indeed all land management activities. 
This is the need for adequate funding to monitor biological resources 
that are affected by federal land management practices.
    In recent years, the resource management community has recognized 
that business as usual concerning the management of commodities on 
federal lands will make it increasingly difficult to meet public 
demands for conservation, recreation and education benefits from these 
lands. Such understanding led the agencies to adopt an ``ecosystem'' 
approach to resource management. Ecosystem management has been widely 
discussed, debated and generally accepted among conservationists. 
However, the agencies have not yet gathered the political support and 
the necessary resources to implement ecosystem management effectively.
    Ecosystem management requires a change in the way research and 
management are accomplished. Managers must adopt an ``adaptive resource 
management'' approach. The Wildlife Society recently published an 
important paper ``ARM! For the future: adaptive resource management in 
the wildlife profession.'' I submit a copy of this report for your 
information. The authors explain that research and management must be 
integrated ``to address uncertainty in wildlife and ecosystem 
management, and thereby ameliorate controversy in the future. Research 
and management can no longer afford to be `two solitudes'; distinctions 
between basic and applied research have blurred. The central issue is 
the application of sound scientific principles to solve problems.'' 
Management experiments must be initiated that can provide the knowledge 
needed for more effective and acceptable natural resource policy 
decisions. Adaptive management involves: (1) hypothesizing how 
ecosystems work, (2) monitoring results, (3) comparing results to 
expectations, and (4) modifying management to better achieve objectives 
through improved understanding of ecological processes.
    We recognize that there may be resistance among some who fear that 
monitoring will reveal information that will somehow constrain the 
ability of landowners to manage their property. To the contrary, 
appropriate monitoring can foster responsive management and help 
alleviate the need for regulation. We should not fear the message or 
the messenger. Decision makers need the best available information on 
which to base short and long-term actions.
    An absolutely key element of responsive natural resource management 
is support for monitoring. Without adequate monitoring, as is evident 
in each of the budgets of the federal agencies, truly responsive 
management will be impossible. There will be no way for managers to 
understand the actual biological consequences of their actions. Without 
monitoring, programs will be inefficient and likely ineffective in 
accomplishing resource management objectives. We understand that the 
White House Office of Science and Technology is developing a national 
monitoring proposal. We urge that this effort include input from the 
management agencies. We further suggest that the Administration prepare 
an analysis of monitoring needs for each agency to accomplish its 
management goals. We urge Congress to exert leadership to ensure 
adequate funding for monitoring in each of the budgets for the natural 
resource agencies.
    The Wildlife Society is pleased to offer the following detailed 
comments on the fiscal year 1998 budget
                  biological resources division, usgs
    The Biological Resources Division (BRD) of the U.S. Geological 
Survey houses most of the science, research, and monitoring 
capabilities of Interior's land management agencies. It is critical 
that these activities continue. The integration of the BRD as a 
division within the USGS reduced emphasis on biological research by 
further separating research activities from the management agencies 
that are charged with conserving the nation's wildlife resources. 
Reliable biological information is necessary for the sound stewardship 
of natural resources by federal and state land management agencies.
    Many issues under Interior Department's authority affect private, 
as well as public lands. Skilled managers and sound scientific 
information are critical to informed decision making regarding issues 
such as: (1) mitigating the effects of contaminants on wildlife 
populations such as that of DDT on bald eagles and peregrine falcons; 
(2) determining management prescriptions to improve forest and 
rangeland health; (3) setting appropriate fish and wildlife harvest 
levels; (4) protecting unique habitats and rare species; and (5) help 
in citizens achieve their land management goals consistent with 
conservation needs.
    The Wildlife Society recognizes that to achieve excellence in 
management, we must achieve excellence in science, first. To maintain 
healthy wildlife populations while providing for a variety of other 
uses, management programs must be based on results of quality 
scientific investigations that produce objective, relevant information. 
Scientists are needed to identify and analyze alternative management 
options for consideration by policy makers. Good scientific information 
can help managers understand how to conserve natural resources while 
allowing multiple uses including timber harvesting and grazing. If the 
science budget of the Interior land management agencies is stripped, 
the ability of its managers to carry out their crucial duties will be 
jeopardized.
Research
    The Wildlife Society supports fiscal year 1998 funding for NBS at 
$149 million. Emphasis should be placed on adequate funding for 
Cooperative Fish and Wildlife Research Units, migratory birds, 
contaminants, wildlife health, Alaska wildlife, control of exotic 
species, habitat studies of agriculture and land management, and 
watershed level studies of wildlife affected by development. Special 
emphasis should be placed on the Cooperative Research Units. The 
Wildlife Society requests that this program be increased to at least 
$15 million. The Cooperative Research Program provides the natural 
resources management community with a scientific basis for making 
decisions, and with highly trained professionals to help implement 
them.
                       fish and wildlife service
Wildlife diversity programs
    The Wildlife Society supports $1 million for the Wildlife 
Conservation and Appreciation Fund (established by the Partnerships for 
Wildlife Act of 1993). The Act establishes a formal partnership between 
the FWS, state wildlife agencies, and private organizations to 
cooperatively initiate wildlife and appreciation projects. Better 
information about species and habitat throughout the United States is 
needed to promote wildlife diversity, productivity and environmental 
health. Of particular importance are habitats and species that are 
declining. Sufficient funding now may prevent future listings under the 
Endangered Species Act.
    The Grants to States program, authorized for $5 million under the 
Fish and Wildlife Conservation Act, was not slated for funding in the 
administration's proposal. The Wildlife Society recommends strongly 
that the program receive its full appropriation of $5 million. The 
program should provide grants to states to assist them in the 
development and implementation of comprehensive wildlife conservation 
programs. Congress also should adopt a funding mechanism to support 
fish and wildlife diversity legislation by expanding the successful 
dedicated user fee approach of the Federal Aid to Wildlife Restoration 
Fund. This wise investment will help avoid future crises while 
providing needed conservation, recreation and education opportunities 
for all Americans.
Endangered species
    The Wildlife Society supports the administrations's request for an 
additional $11.396 million in the Endangered Species Program. The 
President's request for an increase of $7.5 million for the Cooperative 
Endangered Species Fund (Section 6) is needed. The Cooperative 
Endangered Species Fund establishes grants to states to assist the FWS 
in its work to recover endangered and threatened species, and to 
monitor the status of candidate and recovered species. The additional 
funding is needed to support state recovery actions and for habitat 
conservation plans. We also support the President's proposed funding 
for listing, consultation, and recovery.
Wetlands
    The administration's proposed funding for the North American 
Wetlands Fund is $14.4 million. The Wildlife Society recommends that 
the funding be increased to the full authorization level of $20 
million. This fund provides grant to support international Wetlands 
conservation. Criteria established under the North American Wetland 
Conservation Act encourage private-public cost-sharing projects for the 
purpose of protecting and managing wetland habitats for migratory birds 
and other wetland wildlife in Canada, Mexico and the U.S. The 
tremendous success of this program in generating in excess of a 2:1 
match from non-federal sources plus the acreage secured warrant its 
full appropriation.
Migratory bird management
    The Wildlife Society supports the administration's funding of 
Migratory Bird Management at $17.107 million. The FWS is responsible 
for the management of migratory game birds, pursuant to the Migratory 
Bird Treaty of 1918.
    The Wildlife Society supports the administration's request for 
migratory nongame birds, which includes the Partners in Flight program. 
The migratory nongame bird program focuses on the following: conserving 
species assemblages rather than individual species, protecting areas of 
high diversity and density, preserving or restoring critical, declining 
or vulnerable habitats, and cooperating with the public and private 
sector to protect sites that support species otherwise at risk.
    The Wildlife Society support the administration's funding proposal 
for the North American Waterfowl Management Plan office at $2.543 
million. The North American Waterfowl Management Plan was established 
to conserve and restore North American wetland ecosystems for waterfowl 
and other wetland-dependent wildlife through forming partnerships. 
There are additional benefits associated with wetland restoration and 
these include: increased floodwater storage, reduction in flood damage, 
purification of groundwater, and retention of sediment.
Refuges
    The Wildlife Society supports $200 million for refuge operations 
and maintenance. This amount will begin to address the enormous 
maintenance backlog of nearly $400 million that is allowing the Refuge 
System infrastructure to degrade. A significantly increased funding 
commitment is needed to restore the System to adequate conditions.
National Fish and Wildlife Foundation
    The Wildlife Society supports the administration's request of $5 
million to fund the National Fish and Wildlife Foundation. The 
Foundation's funds leverage matching money from state and private 
sources to support many innovative wildlife conservation programs.
                       bureau of land management
Wildlife habitat and fisheries management
    The administration's proposal of $27.234 million for wildlife 
habitat and fisheries management is not adequate to address the 
significant needs on the 270 million acres of land that is administered 
by the BLM. The number of wildlife biologists has been reduced to a 
level where each biologist is responsible for managing over 1 million 
acres of land. The Wildlife Society suggests a minimum of $30 million 
for this program area.
    The main objective of the wildlife and fisheries management program 
has been to implement the Fish and Wildlife 2000 strategic plan. The 
Wildlife Society recommends that this plan be clearly integrated into 
the BLM ecosystem management plans that are being developed.
Threatened and endangered species
    The fiscal year 1998 proposed funding for threatened and endangered 
species is $16.795 million. This program involves recovery actions for 
threatened and endangered species to assure that activities on BLM 
lands do not jeopardize the existence of species habitat. The Wildlife 
Society recommends at least $20 million for this area.
Oregon and California grant lands
    The Oregon and California Grant Lands appropriation provides funds 
for the management of revested railroad land, which is being managed 
for permanent forest production. The fiscal year 1998 funding request 
for O&C Lands is $101.406 million. TWS supports the administration's 
proposal to increase funding for O and C Grant Lands with greater 
emphasis on wildlife and fisheries conservation, especially to help 
implement the Northwest Forest Plan.
Rangeland management
    The Wildlife Society supports the adminastration's fiscal year 1998 
request of $54.342 million for rangeland management. We urges the BLM 
to develop measurable standards and guidelines, and increased 
monitoring efforts, which are necessary for rangeland reform. In 
addition, we support continued efforts to improve riparian habitat and 
the commencement of scientifically based efforts to restore upland 
habitats. We support the additional appropriation of $250,000 for the 
Seeking Common Ground initiative. This program will attract matching 
grants that will bring ranchers and conservationists together to 
enhance livestock and wildlife habitat.
                             forest service
Wildlife management
    The President's budget proposes $30 million for the Get Wild 
program in fiscal year 1998. TWS recommends an increase of $10 million, 
for a total of $40 million. This funding level is still well below the 
$54 million in wildlife management opportunities identified in forest 
plans. Increased investments in wildlife will yield tremendous economic 
benefits to local communities. There are 11 emphasis areas of wildlife 
management within the Get Wild program that focus on partnerships, 
habitat protection, public enjoyment, and habitat improvement for 
particular wildlife species, groups of species, or special habitats. 
Increased funds are especially needed for the following program areas; 
Neotropical Migratory Bird Conservation (Partners in Flight), and 
Wetland Wildlife Habitat Management (Taking Wing), and cavity dependent 
species.
Threatened, endangered and sensitive species
    The Every Species Counts program (threatened, endangered and 
sensitive species management) is slated for $27.2 million in the fiscal 
year 1998 budget proposal. The Forest Service manages habitat for over 
265 threatened and endangered species, as well as 2,300 species which 
have been identified as sensitive by regional foresters. There are 
urgent needs for additional funding in the following areas: recovery of 
listed species, the prevention of future species listing, and rare 
plant protection and management. The Wildlife Society requests that 
emphasis be placed on the management of the following species of 
terrestrial wildlife: Mexican spotted owl, willow fly-catcher, red 
cockaded woodpecker, grizzly bear, California spotted owl, northern and 
queen charlotte island goshawk, and marbled murrelet.
Range management
    The administration is requesting $45.388 million for range 
management for fiscal year 1998, an increase of over $7 million over 
fiscal year 1997 enacted funds. The Wildlife Society supports this 
increase due to the importance of improving range conditions. Proper 
management of rangeland enhances ecosystems that are important for 
watershed protection, wildlife habitat, threatened and endangered 
species, recreation opportunities and livestock. Emphasis should be 
placed on restoration of riparian areas and monitoring of range 
condition. An additional $250,000 should be appropriated to support the 
Seeking Common Ground program.
Forest Environment Research
    The Forest Environment Research program provides knowledge, 
techniques and strategies needed to manage and protect forest, 
rangeland and aquatic ecosystems. The administration's fiscal year 1997 
budget request for Forest Environment Research is $39.95 million. For 
fiscal year 1997, The Wildlife Society recommends that the Wildlife, 
Rare Plants and Communities research program be funded at $15.1 
million. The Wildlife Society also recommends that this money be 
allocated for the following specific research program focuses: 
threatened and endangered species, neotropical migratory birds, forest 
carnivores, forest raptors, old growth, and native prairie fauna. 
Research on threatened, endangered and sensitive species is especially 
important to help reduce future litigation under the Endangered Species 
Act.
State and private forestry
    The cooperative state and private forestry program provides 
assistance to aid in the management and protection, of forest resources 
on state, urban, and private lands to meet domestic and international 
demands for goods and services. Fifty-nine percent of the Nation's 
commercial forest land is in nonindustrial private ownership. The 
proper management of these lands will ensure the future availability of 
natural resources. The Wildlife Society recommends an increased 
emphasis the Forest Legacy program, and the Urban and Community Forest 
Program. The Wildlife Society supports the President's request of $4 
million for the Forest Legacy Program. This amount would provide a 
continued base of support for this innovative program that protects 
private forest lands threatened by conversion to non-forest uses. The 
Wildlife Society supports the administration's budget request of $10.23 
million for the Stewardship Incentive Program. This program should 
encourage a landscape based perspective when planning for multiple 
benefits of forests on private lands. The Wildlife Society supports the 
President's request of $25.5 million for urban and community forests. 
The Initiative assists the federal government in responding to the 
needs of people in urban areas and provides federal resources to 
protect, maintain, and manage trees, forests, and related natural 
resources in and around cities and communities.
    Thank you for your support of scientifically based natural resource 
programs.
                                 ______
                                 

     Prepared Statement of David N. Startzell, Executive Director, 
                      Appalachian Trail Conference

    Mr. Chairman: In behalf of the Appalachian Trail Conference, and 
for the reasons noted below, we are requesting an fiscal year 1998 Land 
and Water Conservation Fund appropriation of $7.2 million for 
Appalachian National Scenic Trail land acquisition: $4.2 million for 
the National Park Service Appalachian Trail program and $3 million for 
the U.S. Forest Service Appalachian Trail program. Those levels are 
consistent with the Administration's budget request and will ensure 
continued progress toward our ultimate goal of a publicly owned 
corridor or greenway extending the entire 2,160-mile length of the 
Appalachian Trail--a goal that we now believe is achievable in the year 
2000 (see tables 2 and 3).
    Background.--The Appalachian Trail was initially established 
between 1923 and 1937 and has been maintained as a continuous footpath 
since that time. In 1968, with the passage of the National Trails 
System Act, the Appalachian Trail was designated as the nation's first 
national scenic trail. The act also authorized federal land acquisition 
to establish a permanent route and protective corridor for what then, 
as now, was America's most prominent long-distance hiking trail. 
Although the authorization was established 29 years ago, it was not 
until 1978 that significant appropriations from the Land and Water 
Conservation Fund were made available for federal land acquisition 
along the trail. Nevertheless; the Appalachian Trail project has become 
an outstanding example of what can be achieved through the collective 
efforts of the Congress, the affected federal agencies, and the private 
sector, represented by the Appalachian Trail Conference and our club 
and individual volunteer affiliates.
    Resource characteristics.--The Appalachian Trail is a continuous, 
marked, 74-year-old footpath that traverses the Appalachian mountain 
chain from central Maine to northern Georgia for a distance of 2,160 
miles. The footpath and its associated protective corridor form a 
greenway extending along much of the eastern seaboard and connecting 
more than 75 public land areas in 14 states, including six other units 
of the national park system and seven national forests, as well as many 
state park, forest, and game-management units. Virtually every mile of 
the trail is within easy access of a major population center, and some 
portion of the trail is within a day's drive for two-thirds of the 
population of the United States.
    As the longest unit of the national park system, the Appalachian 
Trail provides opportunities for millions of visitors each year to 
traverse and experience much of the richness and diversity of eastern 
America: its highest mountains, its great rivers, its pastoral valleys, 
its cultural legacies. The trail also affords opportunities for 
continuous long-distance hiking that are unparalleled anywhere else in 
the world. An estimated three to four million annual visitors enjoy 
some portion of the trail, ranging from leisurely strolls to weekend 
outings to extended backpacking excursions, ranking the trail among the 
most heavily visited units of the national park system.
    In addition to its recreational qualities, the Appalachian Trail 
and its associated corridor represent an important reservoir of 
biological diversity. For example, the trail, due to its great 
latitudinal extent, passes through four of the seven primary forest 
habitats of North America. Moreover, recent natural-diversity 
inventories conducted by the Appalachian Trail Conference and a variety 
of state natural-heritage programs have identified 1,325 occurrences of 
rare, threatened, or endangered plants and animals at 370 sites along 
the approximately 70 percent of the trail route that has been surveyed 
to date. These findings have led a number of natural scientists to 
conclude that the trail and its greenway will play an increasingly 
important role in ensuring critical habitat for many species of flora 
and fauna in the eastern United States. These findings also rank the 
Appalachian National Scenic Trail as perhaps the most biologically 
diverse unit of the national park system.
    A public/private partnership.--For more than 70 years, the 
Appalachian Trail project has been recognized as one of America's most 
successful examples of private-citizen action in the public interest. 
Since the initial construction of the trail in the 1920s and 1930s, 
volunteers affiliated with the Appalachian Trail Conference (ATC) have 
constructed, reconstructed, and maintained the footpath as well as a 
system of more than 250 shelters and associated facilities such as 
privies, bridges, signs, and parking areas. More recently, as a result 
of an unique 1984 agreement between the National Park Service and ATC, 
the conference has accepted management responsibility for more than 
100,000 acres acquired by the National Park Service along the trail. 
ATC, through its network of 32 club affiliates and many thousands of 
volunteers, is now responsible for virtually all phases of ``park'' 
operations, including access control, structures management, public 
health and safety issues, and natural and cultural resources 
management. In 1996, more than 4,790 volunteers contributed more than 
173,800 hours of labor along the trail: an annual contribution valued 
in excess of $2 million. In addition, each year the conference and its 
club affiliates contribute more than $2 million in operating revenues 
to support volunteer-based stewardship of the trail and educational and 
other forms of assistance to its visitors.
    Program accomplishments.--The Appalachian National Scenic Trail 
land-acquisition programs of the National Park Service (NPS) and U.S. 
Forest Service (USES) surely rank among the most successful federal 
land-acquisition programs in the nation. With the strong support of 
this committee and the Congress as a whole, the two agencies have made 
truly remarkable progress in this long-term program: Since 1978, the 
NPS has acquired 2,348 parcels of land, encompassing more than 100,000 
acres in 11 states, and protected a permanent right-of-way and 
associated resources along 599 miles of the trail. Similarly, the U.S. 
Forest Service has acquired more than 45,600 acres within the 
proclamation boundaries of the seven national forests crossed by the 
trail and protected more than 142 miles of right-of-way. As a result, 
while in 1978 more than 800 miles of the trail were located on private 
lands, often in areas with inferior natural or recreational qualities, 
including more than 200 miles along roads, today only 36 miles remain 
unprotected. In addition, in many instances, land acquisition has 
permitted relocations of the footpath to new areas possessing 
outstanding natural and scenic qualities.
    Funding requirements.--While only approximately 36 miles of the 
Appalachian Trail remain to be protected, the total remaining program 
for both the National Park Service and the U.S. Forest Service will 
require the acquisition of approximately 400 parcels encompassing 
approximately 17,000 acres (see table 1). All of these remaining 
parcels possess significant natural, scenic, and recreational qualities 
worthy of federal protection, and many are threatened by incompatible 
development or land uses. For fiscal year 1998, given the requested 
appropriation level of $7.2 million, we estimate the National Park 
Service will acquire an additional 1,880 acres, while the U.S. Forest 
Service will acquire an estimated 2,250 acres (see tables 2 and Table 
3). Based on past experience, we also estimate that both agencies will 
achieve 100-percent obligation rates. In addition, we now believe, 
assuming similar appropriation levels in fiscal year 1998 and fiscal 
year 1999, the entire length of the Appalachian Trail from Maine to 
Georgia--the world's longest publicly owned greenway--can be fully 
protected in the year 2000, providing the American people with a 
remarkable legacy for the 21st century and beyond.
    Again, in behalf of the Appalachian Trail Conference, we wish to 
thank the chairman and members of the subcommittee for this opportunity 
to testify, for your consideration of our fiscal year 1998 
appropriations request, and for the subcommittee's support over many 
years.

    Attachments: Tables 1, 2, 3

                                                                         TABLE 1.--APPALACHIAN TRAIL PROTECTION PROGRAM                                                                         
                                                                [Protection progress by agency, March 1, 1978 thru December 1996]                                                               
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    Protected March 1978 to present                                                 Protection pending                          
                                              --------------------------------------------------------------------------------------------------------------------------------------------------
                                                         NPS                     State                     USFS                     NPS                    State                   USFS         
                                              --------------------------------------------------------------------------------------------------------------------------------------------------
                                                Miles   Acres   Tracts   Miles   Acres   Tracts   Miles   Acres   Tracts   Miles   Acres  Tracts   Miles   Acres  Tracts   Miles   Acres  Tracts
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Maine........................................   169.9   28,645     110    68.2    9,791      18  ......  .......  ......     2.8     923       5     1.4     128       2  ......  ......  ......
New Hampshire................................    45.0    8,393     118     0.5       68       1     7.4    6,806      11  ......      86       3  ......  ......  ......     0.1       5       3
Vermont......................................    49.3    8,998     198     3.1      384       2    18.3    8,799      29     1.7   3,491      16  ......  ......  ......  ......      60       3
Massachusetts................................    31.2    5,305     156    17.3    2,746      39  ......  .......  ......     0.1     453       7  ......  ......  ......  ......  ......  ......
Connecticut..................................    32.2    6,220     125     6.0      550       3  ......  .......  ......     2.8     624      12  ......  ......  ......  ......  ......  ......
New York.....................................    57.0    7,967     228     4.4      551       4  ......  .......  ......     0.1     453      32     0.2      16       2  ......  ......  ......
New Jersey...................................  ......      802      59    24.1    3,031     103  ......  .......  ......  ......     293       9  ......      48       1  ......  ......  ......
Pennsylvania.................................    97.0   13,062     573    10.3    1,447      29  ......  .......  ......     3.4     257      26  ......  ......  ......  ......  ......  ......
Maryland.....................................     3.5    1,092     104     8.9    1,360     106  ......  .......  ......     3.9     907      35     1.8     196      14  ......  ......  ......
Virginia.....................................    88.4   16,123     544     3.3      371       8    32.0   12,973     161     4.9   1,806      48     0.2       1       1     5.8   3,500      66
West Virginia/Virginia.......................    25.6    3,355     133  ......  .......  ......  ......  .......  ......  ......      16       2  ......  ......  ......  ......  ......  ......
North Carolina/Tennessee.....................  ......  .......  ......  ......  .......  ......    83.3   16,648     343  ......  ......  ......  ......  ......  ......     7.3   3,400      98
Georgia......................................  ......  .......  ......  ......  .......  ......     1.2      446      18  ......  ......  ......  ......  ......  ......  ......      30       1
                                              --------------------------------------------------------------------------------------------------------------------------------------------------
      Total..................................   599.1   99,962   2,348   146.1   20,299     313   142.2   45,672     562    19.7   9,309     195     3.6     389      20    13.2   6,995     171
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


                                                                         TABLE 2.--APPALACHIAN TRAIL PROTECTION PROGRAM                                                                         
                                                                  [National Park Service funding required to complete program]                                                                  
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                            Fiscal years--                                                                      
                                                               ---------------------------------------------------------------------------------------------------------------------------------
                             State                                        1997                      1998                      1999                      2000                  Total program     
                                                               ---------------------------------------------------------------------------------------------------------------------------------
                                                                   Acres       Dollars       Acres       Dollars       Acres       Dollars       Acres       Dollars       Acres       Dollars  
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Maine.........................................................          896     $694,000  ...........  ...........  ...........  ...........           27      $44,000          923     $738,000
New Hampshire.................................................           86      119,000  ...........  ...........  ...........  ...........  ...........  ...........           86      119,000
Vermont.......................................................        2,145      573,000        1,283     $675,000           18      $85,000           61      347,000        3,507    1,680,000
Massachusetts.................................................          430      445,000           17       44,000  ...........  ...........  ...........  ...........          447      489,000
Connecticut...................................................           20       40,000          107      339,000          366      722,000  ...........  ...........          493    1,101,000
New York......................................................           85      187,000           63      333,000           20      166,000  ...........  ...........          168      686,000
New Jersey....................................................           97      546,000           28      188,000  ...........  ...........          215      871,000          340    1,605,000
Pennsylvania..................................................           49      121,000           83      242,000           14       53,000          104      292,000          250      708,000
Maryland......................................................          141      535,000           96      698,000          602    1,950,000          119      742,000          958    3,925,999
West Virginia.................................................  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ...........  ...........
Virginia......................................................          195      240,000          206      881,000          827      424,000          255      735,000        1,483    2,280,000
                                                               ---------------------------------------------------------------------------------------------------------------------------------
      Total...................................................        4,144    3,500,000        1,883    3,400,000        1,847    3,400,000          781    3,031,000        8,655   13,331,000
Boundary survey...............................................  ...........      500,000  ...........      800,000  ...........      800,000  ...........      800,000  ...........    2,900,000
                                                               ---------------------------------------------------------------------------------------------------------------------------------
      Grand total.............................................  ...........    4,000,000  ...........    4,200,000  ...........    4,200,000  ...........    3,831,000  ...........   16,231,000
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------


                                                     TABLE 3.--APPALACHIAN TRAIL PROTECTION PROGRAM                                                     
                                              [National Park Service funding required to complete program]                                              
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       Fiscal years--                                                                   
                             ---------------------------------------------------------------------------------------------------------------------------
           Forest                      1997                    1998                    1999                     2000             Total remaining program
                             ---------------------------------------------------------------------------------------------------------------------------
                                Acres      Dollars      Acres      Dollars      Acres      Dollars       Acres       Dollars       Acres       Dollars  
--------------------------------------------------------------------------------------------------------------------------------------------------------
White Mountain (New                                                                                                                                     
 Hampshire).................          4      $40,000  .........  ...........  .........  ...........            1      $10,000            5      $50,000
Green Mountain (Vermont)....         60       35,000  .........  ...........  .........  ...........  ...........  ...........           60       35,000
Washington/Jefferson                                                                                                                                    
 (Virginia).................        200      600,000      1,300   $1,500,000      1,100   $1,400,000          900    1,365,000        3,500    4,865,000
Nantahala/Pisgah (North                                                                                                                                 
 Carolina)..................        100      325,000        250      500,000        400      750,000          350      925,000        1,100    2,500,000
Cherokee (Tennessee)........        750    1,000,000        700    1,000,000        400      700,000          450      700,000        2,300    3,400,000
Chattahoochee (Georgia).....  .........  ...........  .........  ...........  .........      150,000  ...........  ...........           30      150,000
                             ---------------------------------------------------------------------------------------------------------------------------
      Grand total...........      1,114    2,000,000      2,250    3,000,000      1,930    3,000,000        1,701    3,000,000        6,995   11,000,000
--------------------------------------------------------------------------------------------------------------------------------------------------------

                                 ______
                                 

   Prepared Statement of Mary Margaret Sloan, Conservation Director, 
                        American Hiking Society

    As the conservation director for American Hiking Society, a non-
profit conservation organization, I am speaking on behalf of over 
500,000 hikers nationwide. While economic, health and social benefits 
of trails are satisfied primarily at the local level, a strong but 
well-placed federal involvement is necessary for these benefits to be 
fully realized.
    The numerous economic, health and social benefits of trails are 
compelling reasons for Congress to invest tax dollars in them. It makes 
sense for Congress to encourage and facilitate recreational land use, 
especially when examining the impact recreation has on the U.S. 
economy; for example, the Forest Service calculates that 74.8 percent 
of the $130.7 billion generated toward the Gross National Product by 
activities in National Forests will come from recreation in the year 
2000. American Hiking recommends Congress appropriate the following 
amounts for recreation:
  --National Trails System: (a) National Park Service: $3.5 million for 
        the 15 national scenic and national historic trails it 
        administers, (b) USDA Forest Service: $1.35 million for the 10 
        national scenic and national historic trails it administers 
        either solely or through agreements with the National Park 
        Service, (c) Bureau of Land Management: $400,000 to administer 
        the Iditarod National Historic Trail and for the portions of 
        nine other national scenic and national historic trails managed 
        through agreements with the Park Service and Forest Service;
  --National Park Service Rivers, Trails and Conservation Assistance 
        program: $11.5 million to support over 200 projects nationwide 
        and provide base funding, technical assistance and 
        administration to the 10 newly-designated National Heritage 
        Areas;
  --National Park Service Challenge Cost-share: $600,000 for the 15 
        national scenic and national historic trails it administers;
  --Forest Service Trails Construction/Reconstruction: $36.5 million 
        for the 125,000 miles of trail it administers;
  --Bureau of Land Management Recreation Management: $50.5 million;
  --Land and Water Conservation Fund: $7.2 million for the Appalachian 
        National Scenic Trail.
    Trails increase property values, contribute to local and national 
economies, and provide avenues to boost public health. A 1992 study by 
Greenways, Inc. found that Seattle's Burke-Gilman Trail has increased 
the value of homes near the trail by 6.5 percent. And the Outdoor 
Recreation Coalition of America, a trade association, estimates that 
total current sales of outdoor products and specialty items are $10 
billion. One of the reasons Americans invest so much in their local 
trails is the health benefits exercising on trails can provide: 
preventing heart disease, decreasing hypertension, improving and 
preventing osteoporosis and losing weight.
                         national trails system
    One of the most visited components of America's recreation lands 
are the 37,000 miles of congressionally-designated long-distance 
trails. The Appalachian Trail alone, stretching 2,100 miles from Maine 
to Georgia, receives 3-4 million visitors per year. The annual 
appropriations for these trails are very small, compared to their 
length--approximately $95 per mile (excluding land acquisition through 
the Land and Water Conservation Fund). American Hiking supports a 
National Park Service appropriation of $3.25 million, principally 
because of the demands the newly designated Selma-to-Montgomery 
National Historic Trail and the revitalized Potomac Heritage National 
Scenic Trail will put on an already under-funded program.
    The American public has invested heavily in its national trails 
system. In 1996, local trail organizations brought over 473,000 hours 
of volunteer labor and over $4 million in direct financial 
contributions to the trail-building efforts of public-private 
partnerships. The Potomac Heritage Trail was designated a National 
Scenic Trail in 1983, but public involvement and interest lagged at 
that time. 1996 saw a renewed interest in the trail and over 40 private 
groups are expected to participate in a trail community summit for the 
Potomac Heritage Trail this spring. To support the rebirth of this 
project, to conduct the legally required comprehensive plan for the 
Selma-to-Montgomery National Historic Trail and to meet the demands of 
the public, the National Park Service long-distance trails budget 
should be increased to $3.25 million, for the 15 trails it administers. 
The USDA Forest Service should receive $1.35 million for the four 
trails it administers, and the BLM should receive $400,000 to 
administer the Iditarod National Historic Trail and for the portions of 
seven other trails managed by the BLM through agreements with the Park 
Service and the Forest Service.
   national park service rivers, trails and conservation assistance 
                                program
    American Hiking strongly believes that the future of trails and 
outdoor recreation lies in the hands of the American public. However, 
the federal role in trails remains essential. Federal staff knowledge, 
facilitation skills, and technical expertise are needed so that local 
and state governments can do for themselves. The National Park Service 
Rivers, Trails and Conservation Assistance program (RTCA) has been one 
of the more effective federal programs in encouraging local initiative 
and providing technical assistance. One example of the program's 
success is the Arizona Trail. In partnership, the Arizona Trail 
Association, Arizona State Parks, four national forests, BLM, and four 
national parks are well on the way to establishing a 750-mile trail 
crossing Arizona from Mexico to Utah. Many parts of the trail are 
primitive, passing through wilderness areas, while other sections of 
the trail pass near or through urban areas, providing close-to-home 
connections to surrounding natural areas. RTCA assistance in completing 
the trail includes technical assistance in route planning, helping to 
establish a friends of the trail group to maintain the trail and 
coordinating involvement of the four national parks.
    Unfortunately, the program is hampered by a funding shortage. Of 
the 400 project requests RTCA received from states, localities and the 
private sector last year, it was able to accept only one-half. With a 
$700,000 increase to its base funding, RTCA will be able to accept 15-
30 additional projects.
    In addition this program is taking on several new types of projects 
this year. The 104th Congress designated ten heritage areas, for which 
RTCA will require $100,000--a total of $1 million, plus $500,000 for 
competitive project-specific funding and $1.25 million for technical 
assistance for these programs. An investment in these programs will 
yield benefits ten-fold in state, local and private investment and 
public health and enjoyment. As co-chair of the Rivers and Trails 
Coalition, representing 29 non-profit organizations and trade 
associations, American Hiking requests full funding for this program.
               national park service challenge cost-share
    National Park Service Challenge Cost Share program is a valuable 
tool, contributing to the completion of our national trails system. In 
fiscal year 1997, approximately $600,000 was earmarked for national 
scenic and national historic trails within this program; the state and 
local government match was almost double. This match is the key to a 
successful federal program; it indicates that there is significant 
local support for the project, and it provides a basis for a true 
partnership. Local investment in trails, which this program demands, is 
a program worth receiving full federal backing.
           forest service trails construction/reconstruction
    After floods and mudslides devastated the Pacific Northwest this 
winter, the Forest Service Trails Construction/Reconstruction needs are 
now $36.5 million. Trails off of the Columbia River Gorge suffered 
tremendous damage; flow of granular snow scoured the whole gorge, 
wiping out the Eagle Creek Trail--among others--along with the trail's 
suspension bridge. The FS manages 125,000 miles of trail, including the 
Continental Divide, Pacific Crest and Florida National Scenic Trail, 
and the Nez Perce National Historic Trail. Many of these miles of trail 
need federal attention and assistance.
    Forest Service Trails Construction/Reconstruction is not the only 
trail need in the Forest Service, but it represents the only trail line 
item in the FS budget. Trail maintenance was subsumed under Recreation 
Operations and Maintenance in fiscal year 1996. Since the line-item no 
longer exists, growing trail maintenance needs often go unmet, adding 
to a construction/reconstruction/maintenance backlog of $267 million. 
Hikers do what they can to alleviate this enormous backlog; they 
volunteer their time and energy. In the White Mountain National Forest 
last year alone, volunteers from the Appalachian Mountain Club 
contributed over 16,100 hours. American Hiklug requests that a line-
item for FS Trail Maintenance for $30 million be included in the fiscal 
year 1998 budget.
            bureau of land management recreation management
    The Bureau of Land Management's current recreation management need 
is $50.5 million, which is an increase of $4.7 million over fiscal year 
1997. This increase, which includes recreation, recreation operations 
and wilderness, is entirely justified by the devastation from floods 
and fires in the Pacific Northwest. In addition to trail damage from 
natural causes, there is wear and tear from increased recreational use. 
The BLM estimates that in 1998, recreation visitor days will increase 
by 2 percent, to 75 million. The Outdoor Recreation Council of America 
estimates that, nationally, tent camping and backpacking will continue 
to increase at 11 percent annually; most of this use will occur on 
federal lands.
    The demand for recreation on our public lands is staggering and 
American Hiking urges Congress to protect the investment American 
taxpayers have made in these lands. The private sector is contributing 
where it can. The BLM reports that in 1994 volunteers contributed 
nearly 532,000 work hours valued at over $5.8 million. While these 
numbers are significant, volunteers can augment, but not replace, 
federal responsibility. The relationship needs to be a balanced public-
private one, and the public responsibility is $50.5 million.
    BLM recreation opportunities include 502 miles of the Continental 
Divide and Pacific Crest National Scenic Trails, 3,600 miles of the 
Iditarod, Juan Bautista de Anza, California, Nez Perce, Lewis and 
Clark, Oregon, Santa Fe, Mormon Pioneer, and Pony Express National 
Historic Trails, 429 miles of 26 National Recreation Trails, and 7,370 
miles of 68 multiple-use trails.
                    land and water conservation fund
    Since its inception in 1964, the Land and Water Conservation Fund 
(LWCF) has proved to be a particularly valuable tool. This fund is 
authorized at $900 million per year for land acquisition. Yet the 
average funding over the last 17 years has been approximately one-
fourth of the authorized level. American Hiking supports full funding 
for both the state- and federal-side LWCF and particularly supports 
earmarking $7.2 million for the Appalachian Trail ($4.2 million for NPS 
land protection in eight states and $3 million for FS land protection 
in Virginia, North Carolina and Tennessee). The Appalachian Trail 
Conference, which has management responsibility for the trail, 
estimates that funding at this level will permit the acquisition of 
1,883 acres by the NPS and 2,250 by the USDA FS.
    The Appalachian Trail Conference anticipates that at an 
appropriation rate of $7 million per year, the trail will be completely 
protected by the end of the 20th century, making it the first national 
scenic trail to have that distinction.
    American Hiking recognizes that there are only so many resources 
that Congress can direct toward trails. AHS supports the Forest Service 
Roads Construction budge cuts outlined in the Green Scissors Report. 
This is estimated to save $50 million annually, more than enough to 
cover the increases proposed here. American Hiking hopes that Congress 
recognizes and appreciates the time and muscle power that volunteers 
around the country have contributed to our federal lands to make them 
accessible and enjoyable for all Americans. American Hiking believes 
that the balance between the investment of the federal government and 
the investment by private citizens is struck by the dollar figures we 
have outlined in this testimony.
    Thank you for the opportunity to speak before you today. American 
Hiking Society's members and outdoorspeople nationwide appreciate the 
subcommittee's support in the past and look forward to continued strong 
support.
                                 ______
                                 

Prepared Statement of Gregory E. Conrad, Executive Director, Interstate 
                       Mining Compact Commission

    My name is Gregory E. Conrad and I am Executive Director of the 
Interstate Mining Compact Commission. I appreciate the opportunity to 
present this statement to the subcommittee regarding the views of the 
Compact's member states concerning the fiscal year 1998 Budget Request 
for the Office of Surface Mining (OSM). In its proposed budget, OSM is 
requesting $50.1 million to fund Title V grants to states for the 
implementation of their regulatory programs and $142.3 million for 
state Title IV abandoned mine land program grants. Our testimony will 
address both of these budgeted items.
    The Compact is comprised of 18 eastern and mid-continent states 
that together produce some 70 percent of our Nation's coal as well as 
important non-coal minerals. Participation in the Compact is gained 
through the enactment of legislation by the member states authorizing 
their entry into the Compact and they are represented by their 
respective Governors who serve as Commissioners.
    The Compact's purposes are to advance the protection and 
restoration of land, water and other resources affected by mining 
through the encouragement of programs in each of the party states that 
will achieve comparable results in protecting, conserving and improving 
the usefulness of natural resources and to assist in achieving and 
maintaining an efficient, productive and economically viable mining 
industry.
    The Commission has testified before your subcommittee on several 
occasions over the years and has appreciated the subcommittee's 
consideration of our comments and concerns. Given the attention that 
Congress is directing toward the federal budget in terms of deficit 
reduction goals, our primary purpose today is to emphasize the critical 
role played by the states under the structure of the Surface Mining 
Control and Reclamation Act of 1977 (SMCRA) and to urge that the OSM 
budget be aligned so as to support the continuing work of the states.
    Before providing the states' views on specific budget items, I 
would like to address our concerns about the importance of the state/
federal relationship called for under SMCRA. Congress incorporated the 
concept of cooperative federalism in SMCRA because of its belief that 
the states were in the best position to regulate mining operations 
within their borders. At the same time, Congress recognized the need 
for a limited federal oversight role to assure a degree of national 
uniformity among state programs and consistency in state performance. 
This scheme of allocated governmental authority between state and 
federal regulators can and does work in the day-to-day implementation 
of SMCRA when states and OSM are coordinating their efforts. Regardless 
of the level of funding, program expenditures will be more efficient 
and effective if OSM and the states are communicating and cooperating, 
rather than competing and duplicating responsibilities.
    In recent years, OSM has made meaningful strides to incorporate the 
views of the states as part of several ``Task Force initiatives'' that 
directly impact the state/federal relationship and the effective 
implementation of SMCRA. These include federal oversight of state 
programs, use of Ten-Day notices in primacy states, prediction and 
treatment of acid mine drainage at active mining sites, and remining. 
These initiatives address many of the critical issues facing the states 
and OSM today. We have appreciated OSM's willingness to work with the 
states to explore potential solutions to these complex matters and, 
while the states and OSM may not see eye-to-eye on every issue, we 
trust that OSM will continue to operate in an environment of openness 
and congeniality with the states.
    As Congress makes the difficult funding decisions required under 
the deficit reduction plan, we believe it is essential to keep in mind 
that the goal of SMCRA is to preserve the environment where active 
mining operations occur and to enhance the environment through the 
remediation of past problems associated with abandoned mines. We assert 
that funds should be appropriated by Congress in a manner that best 
accomplishes this goal--and that best serves the American people. We 
believe that an analysis of SMCRA confirms that the states are to take 
the lead in pursuing this goal and that state programs for active and 
abandoned mines need to be adequately funded to accomplish this 
objective. Furthermore, from a pragmatic budgetary perspective, 
experience demonstrates that it will cost the federal government 
significantly more to undertake this task than to partially fund the 
existing 23 state regulatory programs. The cost of the existing federal 
regulatory program remains high and in some cases is out of line with 
state expenditures and responsibilities under SMCRA.
    Under the provisions of SMCRA, primary regulatory authority for the 
implementation of the Act was vested in the states. Congress provided 
for assistance to the states in developing and implementing regulatory 
programs to achieve the purposes and objectives of SMCRA through annual 
grants to the states under Title V of the Act. The states have come to 
rely on these Title V grants as a critical portion of the funding 
necessary to carry out their responsibilities as primary regulators 
under SMCRA. The necessity of this funding has taken on increased 
importance as state budgets struggle to keep pace with inflation and 
meet projected regulatory needs. Without these grants, it is unlikely 
that the states would be able to maintain the comprehensive, high 
quality regulatory programs expected under the provisions of SMCRA.
    In OSM's fiscal year 1998 proposed budget, state Title V regulatory 
grants have been funded at $50.1 million. OSM notes in its budget 
justification document that this is a reduction of $500,000 from last 
year's budgeted amount and explains that, in part, this decrease 
``reflects smaller grant requests from States who are having difficulty 
meeting the matching share requirements of SMCRA.'' Although OSM fails 
in its budget justification document to identify specific instances of 
this phenomenon, as we noted in our statement before your subcommittee 
last year, some states are indeed facing decreasing state revenues for 
state program implementation. Most of these decreases are the direct 
result of decreasing coal production due to the impacts of the Clean 
Air Act Amendments of 1990. Since most of the states receive a 
significant portion (if not all) of their state revenues from fees 
assessed to coal operators, as these operators (particularly those 
mining high sulfur coal) reduce their production (or go out of business 
altogether due to implementation of the 1995 Phase I requirement 
contained in the Clean Air Act), those fees evaporate and are generally 
not replaced by revenues from other sources. States are simply not in 
the position to fund their state regulatory programs from general 
revenues given the fiscal belt tightening that is occurring at the 
states level. And yet full funding is necessary to support the affected 
state programs because regulatory efforts and needs do not decrease 
directly with decreased production or numbers of active permits. In 
some instances, just the opposite is true--the number of enforcement 
actions, civil penalties, permit revocations, bond forfeitures, and 
associated appeals increase as markets deteriorate, production and 
revenue decline and bankruptcies increase.\1\
    OSM also fails to note that the states had projected a need for 
$57.7 million in Title V grant moneys when they submitted grant 
requests for fiscal year 1998 about 18 months ago. Consequently, the 
states are looking at an overall shortfall of $7 million between what 
they had projected was needed to run their programs and what OSM 
believes is now necessary. This shortfall is $2.5 million greater than 
last year's shortfall amount of $4.6 million.
    Meeting the states' funding needs is essential to offset the rising 
costs associated with the implementation of regulatory programs, which 
includes such activities as reviewing mine permit applications, 
designating lands as unsuitable for mining, inspecting surface mining 
operations, and maintaining effective enforcement programs. As we noted 
in our statement last year, we were concerned that OSM was initiating a 
trend, supposedly justified by deficit-reduction belt tightening, that 
would result in incremental decreases in the amounts being granted to 
the states. In light of this year's budget numbers, it appears our 
fears were justified and have become a reality. When factored together 
with the rising costs associated with implementing state programs, the 
compounded impact of these grants reductions will result in under-
funded state regulatory programs and potential concomitant impacts on 
the ground.
    For the states to continue the effective implementation of their 
programs, additional federal funding above and beyond that which we 
have traditionally received from OSM will be required. We are therefore 
requesting that OSM's overall appropriation for state Title V grants be 
increased by an additional $35.75 million to $86.25 million so as to 
accommodate the funding needed by states to run their programs. Under 
this scenario, the federal government would provide 75 percent of the 
necessary funding for state program implementation, while the states 
would provide a 25 percent match. We have also requested the 
Congressional committees with jurisdiction over OSM and the Surface 
Mining Act to adjust the specific statutory language in Section 705 of 
the Act to recognize this new funding reality. A resolution to this 
effect adopted by IMCC is enclosed.
    In any event, should this Congress not increase OSM's appropriation 
to accommodate a 75 percent federal funding formula, we urge the 
Appropriations Committee to increase the amount for Title V grants from 
OSM's proposed amount of $50.1 million to $57.5 million in order to 
meet the states' projections of fiscal year 1998 
implementation costs. While we can appreciate the necessity of 
containing the cost of federal regulatory programs, it is essential 
that funding for state programs be preserved at adequate levels since 
the states act as the front line regulatory authorities under SMCRA. It 
also is important to structure any realignment of OSM's budget in such 
a way that the valuable OSM activities which support and enhance state 
programs are not undermined. These include technical training, the 
Technical Information Processing System, the Applicant/Violator System 
(AVS), the COALEX Legal Research System, and a properly focussed 
evaluation of state programs.
    The Compact states also urge the subcommittee to adequately fund 
the Title IV program for reclamation of abandoned mine lands (AML). As 
with Title V regulatory programs, it is important to examine all SMCRA 
program components with the objective of maximizing SMCRA services and 
benefits to our customers under Title IV. We assert that the states 
have been and continue to deliver these benefits and services in the 
most cost-effective and efficient manner through their state programs. 
However, with regard to Title IV funding in particular, we are seeing 
less and less on-the-ground reclamation per dollar spent as states 
struggle to maintain and implement their basic AML delivery system with 
decreasing amounts of money. This is especially true for smaller 
(minimum) state programs where a 25 percent reduction in funding 
translates to significantly less money being available for on-the-
ground reclamation.
    The benefits of the AML program are delivered almost entirely by 
the states. Each year they are responsible for the reclamation of 
hundreds of acres of abandoned coal mine areas along with the 
elimination of hazards to the public such as open edits and dangerous 
highwalls and the reduction or elimination of water pollution 
associated with acid mine drainage. It is incredibly difficult for a 
state to effectively manage a program under Title IV without the 
ability to rely on adequate, certain and consistent funding from year 
to year. Over the years we have seen the funding for state AML programs 
reduced while OSM's Title IV funding continues to increase. This is 
occurring at the same time that the states are assuming more and more 
responsibility for actual implementation of the program, including the 
emergency AML projects. We therefore urge the subcommittee to increase 
the state AML grants from the budgeted amount of $142.3 million to $220 
million (including a minimum of $2 million per state), which will allow 
the states to effectively and efficiently manage their programs and to 
accomplish the valuable work under those programs. Increased funding 
will also serve as a significant economic stimulant, generating 
hundreds of jobs associated with increased AML work. Affording states 
the flexibility to decide local priorities for all expenditures would 
be more efficient and more responsive to the needs of coal field 
citizens, whom the AML program is designed to serve.\2\
    You should know, Mr. Chairman, that in an effort to address the 
outstanding AML problem and adequate funding for state AML programs, 
the states have proposed a plan that would provide for the immediate 
allocation of the accumulated balance of over $1 billion in the AML 
Trust Fund. Under our plan, states would submit to OSM a ``Reclamation 
Management Plan'' that would define the specific results to be achieved 
and a time frame for achieving them. The plan would delegate a 
management role to the states regarding the Trust Fund and would 
require Congress to modify traditional annual budget appropriations in 
favor of multi-year funding based on states' requests in their 
Reclamation Management Plans. I am attaching a copy of this plan and 
would welcome the opportunity to discuss it with subcommittee staff. We 
will also be providing a copy of the Plan to the Senate Energy and 
Natural Resources Committee.
    OSM has proposed an amount of $11.2 million for technology 
development and transfer, which includes improving and expanding the 
services and technical systems provided to states. We wholeheartedly 
endorse this commitment by OSM to strengthening and enhancing state 
programs. In this regard, one of the most successful programs of 
technical support for the states undertaken by OSM is the development 
of the Technical Information Processing System (TIPS). This national 
computer system is operated by OSM for use by the states in carrying 
out their technical regulatory responsibilities under SMCRA. TIPS 
assists in making technical decisions associated with permit reviews; 
performing cumulative hydrologic impact assessments; quantifying 
potential effects of coal mining; quantifying revegetation success; 
assisting in the design of AML projects; and preparing environmental 
assessments and environmental impact statements. We are encouraged to 
see funding continued for TIPS.
    We also urge the subcommittee to continue its support of funding 
for state employees to attend OSM technical training sessions. As OSM 
has noted in the past, ``the most important product of the training 
program has been the steady improvement in the regulation and 
reclamation of surface coal mining. These successes have been largely 
due to the increase in staff technical knowledge, the improvement of 
relationships among Federal and State personnel, and the improvements 
in staff ability to make sound evaluations and decisions.'' Given state 
budget constraints, travel to OSM training sessions is impossible 
without federal funding. If OSM reduces funds for state travel, it is 
unlikely that states will be able to benefit from this much needed 
service.
    We are also hopeful that OSM, as part of its commitment to 
technical services, will support funding for the COALEX Legal Research 
System. Both the states and OSM have traditionally made use of this 
computerized legal research system on an almost daily basis. The system 
provides searches to yield complete and accurate data in minutes, 
thereby eliminating the need for staff to manually search through 
volumes of documents. As implementation of SMCRA becomes more and more 
complex, the need for COALEX has increased. The states, in particular, 
have become reliant on the system's ability to assist us with the 
implementation of our programs and to address the myriad compliance 
actions that attend enforcement of our programs.
    Finally, we urge continued funding of the Small Operators 
Assistance Program (SOAP). This program is critical to the permitting 
of remining operations by small operators, especially the costs 
associated with background water quality assessments, overburden 
analysis and Probable Hydrologic Consequences (PHC) predictions. 
Without financial assistance to undertake these expensive analyses, 
small operators will be unable to submit quality permit packages for 
potential remining operations. This will, in turn, result in additional 
burdens on state and federal AML program funds as remining operations 
will be unavailable to correct problems that currently are on the AML 
inventory. In this regard, SOAP often serves as an incentive to 
encourage the remediation of AMLs through active remining operations, 
thereby reserving AML moneys for more critical problem areas.
    Thank you for the opportunity to present these views on OSM's 
proposed fiscal year 1998 budget. I would be happy to answer any 
questions that you may have.
                               footnotes
    \1\ As another rationale for the $500,000 decrease in state Title V 
grant funding from fiscal year 1997 to fiscal year 1998, OSM states 
that the decrease reflects ``anticipated cost savings as States adopt 
the state counterpart to OSM's November 1994 rule on inspection 
frequency.'' Again, OSM provides no specific data to support this 
justification for decreased state funding. Our experience, however, 
tells us that the number of inspections being conducted by the states 
is not expected to decrease significantly because of the inactive and 
abandoned sites rule. In general, reducing the number of required 
inspections does not directly reduce the number of inspectors or grant 
monies needed to support effective inspection and enforcement.
    \2\ 2We should note that the $142.3 million requested by OSM for 
Title IV state grants includes $5 million which has been allocated for 
the Appalachian Clean Streams Initiative (ACSI). This translates to a 
total request of only $137.3 million for state AML grants funding. 
Although we recognize that at least some portion of the $5 million ACSI 
funding will be allocated to the states, the overall trend in state AML 
grant funding is declining once again to unhealthy and unacceptable 
levels.
                                 ______
                                 

Prepared Statement of Bruce Runnels, Chief Conservation Officer of the 
                           Nature Conservancy

    Mr. Chairman and members of the subcommittee, thank you for the 
opportunity to submit The Nature Conservancy's thoughts on fiscal year 
1998 appropriations for the Land and Water Conservation Fund and other 
conservation programs under your jurisdiction.
    The Nature Conservancy is an international, non-profit land 
conservation organization dedicated to the long-term preservation of 
biological diversity.\1\ The premise that underlies our work is that in 
order to safeguard imperiled species, we must protect their habitats. 
This is the rationale behind our traditional conservation strategy of 
purchasing and managing lands that are home to rare plants and animals. 
Although this strategy has been largely undertaken through private 
action rather than through political means, the Federal Government has 
been an important partner in working to achieve conservation.
---------------------------------------------------------------------------
    \1\ For more than 45 years we have implemented our mission by 
focusing on local, on-the-ground conservation, utilizing the best 
available science, market forces, and partnerships with people and 
groups across the political spectrum. We currently have conservation 
programs in all 50 States and 17 other nations. The Conservancy has 
more than 900,000 individual members and over 1,385 corporate sponsors. 
Our Board of Governors includes renowned scientists such as E. O. 
Wilson and Dan Simberloff; distinguished leaders such as General Norman 
Schwarzkopf and former Deputy Secretary of State John C. Whitehead; and 
corporate officers from major U.S. companies such as John G. Smale of 
Procter & Gamble and Samuel C. Johnson of S.C. Johnson & Son.
---------------------------------------------------------------------------
    Successful conservation of biological diversity must be based on 
understanding ecosystems and conserving the critical occurrences of 
biological diversity supported by them as priorities for our attention. 
The Nature Conservancy is scientifically identifying and developing 
strategies to protect priority sites within ecoregions, or large area 
landscapes delineated by biotic factors rather than political 
boundaries. We are aware that most Federal land management agencies are 
also now committed to an ecosystem-based approach. This committee 
should encourage and strengthen this trend through investments in 
acquisition of exemplary high priority ecological sites and leveraging 
conservation dollars through partnerships with other levels of 
government, private landowners, industry and private organizations.
                       acquisition and management
    The Nature Conservancy believes that continued selective 
acquisition of land by the Federal Government is vital if we are to 
ensure that representative pieces of our nation's natural heritage are 
preserved for future generations. Often, the only thing standing in the 
way of species extinction is the purchase of critical habitat, and at 
times the Federal Government is the most appropriate purchaser. It is 
the quality of Federal lands, not the quantity, that is important.
    Land Acquisition.--The Nature Conservancy appreciates this 
committee's past support for the Land and Water Conservation Fund. We 
recognize that in moving government toward a balanced budget, funding 
levels for the LWCF are under increasing pressure, making the 
identification of the ``best'' parcels even more important. Thus, we 
are highlighting several biologically significant projects about which 
have substantial knowledge. This year, these projects total $51.1 
million. We have provided detailed information and discussed most of 
these with committee staff.
U.S. Fish and Wildlife Service:                                         
    Amagansett NWR (Shadmoor), NY.............................$2,000,000
    Balcones Canyonlands NWR, TX.............................. 4,700,000
    Black River, WA........................................... 1,500,000
    Bon Secour, AL............................................ 3,000,000
    Cape May NWR, NJ.......................................... 3,000,000
    Clarks River NWR, KY...................................... 3,000,000
    Cypress Creek NWR, IL..................................... 2,000,000
    Emiquon NWR, IL........................................... 1,000,000
    Rappahannock River, VA.................................... 2,400,000
    San Diego NWR, CA......................................... 3,000,000
    Stewart B. McKinney NWR, CT............................... 3,600,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................29,200,000
                    ==============================================================
                    ____________________________________________________
Bureau of Land Management:
    Otay Mountain/Kuchamaa, CA................................ 1,000,000
    Santa Rosa Mountains, CA.................................. 1,000,000
    Western Riverside HCP, CA................................. 1,000,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................ 3,000,000
                    ==============================================================
                    ____________________________________________________
U.S. Forest Service:
    Daniel Boone NF, KY....................................... 2,000,000
    Fodderstack Mountains, NC................................. 1,000,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................ 3,000,000
                    ==============================================================
                    ____________________________________________________
National Park Service:
    Cumberland Island, GA..................................... 6,400,000
    Salt River, USVI.......................................... 1,000,000
    Sterling Forest, NY/NJ.................................... 8,500,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Subtotal................................................15,900,000
                    ==============================================================
                    ____________________________________________________
      Total acquisition through LWCF..........................51,100,000

    Stewardship of Public Lands.--A critical component of Federal land 
acquisition is funding for management of those lands. Without active 
management, many of the biological resources we are seeking to protect 
cannot thrive. Some habitats require prescribed burns to maintain 
vegetative diversity, and others require stringent programs for the 
management of exotic species. The Nature Conservancy supports the 
fiscal year 1998 budget requests of the public land management agencies 
for management and stewardship activities. For example, the Bureau of 
Land Management has included in its budget proposal $1.0 million for 
prescribed fire operations and $1.0 million for the prevention and 
control of invasive weed species. Although more funding is needed, this 
is a step in the right direction.
    Land Exchanges.--While continuing to acquire biologically 
significant lands, The Nature Conservancy believes that the Federal 
Government should look for ways to divest itself, through transfers, 
exchanges or outright sales, of Federal lands having little or no 
important ecological function. The Conservancy has a good deal of 
experience with, and is supportive of, land exchanges as a mechanism 
for the acquisition of lands of high biological diversity. We are 
interested in finding ways to make the process less complicated and 
expensive.
    Regional Conservation Initiatives.--The following initiatives are 
setting the standard for regional approaches as they are already 
operating under a regional framework to address their respective 
conservation challenges.
    Natural Community Conservation Plan (NCCP), California.--NCCP is an 
unprecedented partnership among business, conservationists, local 
governments and State and Federal wildlife agencies. In 1991, Governor 
Pete Wilson urged the California legislature to pass the NCCP Act which 
called for the development of comprehensive conservation plans that 
identified key areas for endangered species protection while allowing 
economic growth in other areas. The regional plan covers 6,000 square 
miles and involves five counties, fifty-nine local government 
jurisdictions, and scores of private landowners. The private sector, 
local governments, and the State of California have contributed 
millions of dollars to date to this project--they must be matched by a 
continued strong Federal partnership to fulfill the promise of NCCP. 
The Conservancy supports the Administration's requests for a number of 
NCCP-related programs. For land acquisition, we support $3.0 million 
for the San Diego Refuge; $1.0 million for Otay Mountain/Kuchamaa Area; 
$1.0 million for Western Riverside County; and $1.0 million for Santa 
Rosa Mountains. In the USFWS's Endangered Species program, we support 
$2.0 million in the consultation subactivity for NCCP planning and $6.0 
million in the Cooperative Endangered Species Fund for grants to States 
for land acquisition in support of efforts like NCCP.
    Florida Everglades.--The Florida Everglades are one of the world's 
unique natural systems, originally supporting a remarkable quantity and 
diversity of plant and animal life. The system has now been reduced to 
half its original size by the draining and diversion of water, and the 
remaining Everglades are suffering acute ecological problems. The 
Administration's fiscal year 1998 budget proposes a major investment in 
Everglades restoration, including the establishment within the 
Department of Interior of an Everglades Restoration Fund in the amount 
of $400 million spread over four years to support the most critical 
elements of Everglades watershed restoration. Funding of $100 million 
($76 million for land acquisition; $12 million for modified water 
deliveries; $12 million for scientific research) is requested by the 
Interior Department for fiscal year 1998 and strongly supported by The 
Nature Conservancy. This money is essential to acquire sufficient land 
for water storage and treatment to save the Everglades. Continuing 
research funds are needed to ensure that solutions are cost-effective.
    California Bay-Delta.--The California Bay-Delta is the largest 
estuary on the west coast, providing habitat for 120 aquatic and 
terrestrial species and supplying water for much of California. In 
September 1996, the President signed the California Bay-Delta 
Environmental Enhancement Act, authorizing $143.3 million per year in 
Federal funding for restoration activities in 1998, 1999, and 2000. The 
Administration's fiscal year 1998 budget includes this request and 
proposes to locate the $143.3 million in an account within the Bureau 
of Reclamation, to be allocated later to participating agencies by 
CALFED, a consortium of ten Federal and State agencies. In addition, 
the request includes $59.5 million for ongoing programs in the Fish and 
Wildlife Service, Bureau of Reclamation, and the USGS. The Nature 
Conservancy is an active participant in the Bay-Delta program and 
strongly supports the budget request.
                      key partnership initiatives
    One of the best conservation investments the Federal government can 
make is to be a partner to other entities, both private and public, 
that are working to achieve like-minded goals. In this way, scarce 
resources can be leveraged to increase the total amount of funds 
available for conservation activities. Within any given ecosystem, 
lands may be owned and managed by any combination of Federal, State, or 
local government, private landowners, industry and conservation groups. 
The Federal Government can be a leading partner in facilitating 
conservation in this context. We recommend that the committee continue 
to fund and promote the following programs and initiatives that are 
excellent examples of partnerships that leverage both private and 
public resources for conservation activities.
    National Fish and Wildlife Foundation.--The National Fish and 
Wildlife Foundation [NFWF] is an excellent example of a Federal program 
that effectively leverages conservation benefits. The Foundation builds 
partnerships between the public and private sectors to support 
activities that are focused on solving environmental problems, and has 
an outstanding record of encouraging and rewarding innovation in 
natural resource management. NFWF consistently exceeds a 2:1 private 
match for every dollar received in appropriated Federal money, making 
scarce Federal dollars achieve results two to three times greater than 
otherwise possible. Over the last decade, it has leveraged 
approximately $43 million of Federal funds into $152 million through 
privately matched challenge grants. The Administration has proposed a 
level of $5.0 million for this program in fiscal year 1998, the same 
level as was enacted last year. We believe NFWF merits at least this 
level of funding to continue to forge innovative partnerships and 
leverage limited Federal resources.
    North American Wetlands Conservation Fund.--The North American 
Wetlands Conservation Fund supports an international grant program 
authorized under the North American Wetlands Conservation Act. A 
variety of partners in Canada, Mexico, and the United States have 
contributed millions of dollars to acquire, restore, and enhance 
wetlands to conserve intrinsic wetlands functions, including providing 
habitat for migratory birds, endangered species, and other wetlands-
dependent wildlife. Private partners contribute more than two dollars 
for every Federal dollar, also leveraging scarce resources for 
conservation. As a member of the North American Wetlands Conservation 
Council since its inception in 1989, The Nature Conservancy has been 
part of the panel that recommends projects for final approval by the 
Migratory Bird Conservation Commission. The Administration has proposed 
to increase the funding available for this program by $5.25 million, to 
just over $15 million. The Conservancy strongly supports this high-
leverage increase.
    Incentives for Private Landowners and Habitat Conservation Plans.--
The Nature Conservancy also supports a number of Federal programs that 
have been successful in creating conservation opportunities for private 
landowners and conservation organizations. Private lands are critical 
in achieving the goals of resource protection, as many rare ecological 
systems and species exist only on private lands or are affected by 
activities on such lands. Often, private landowners are willing to take 
voluntary measures to protect habitat on their lands if some incentives 
are available, and Federal agency programs such as USFWS's Partners for 
Wildlife and the Forest Service's Forest Stewardship and Stewardship 
Incentive Programs can provide that incentive. The Administration's 
fiscal year 1998 request for the Endangered Species Act includes 
funding for improving species conservation on private lands. Of the $78 
million total requested, $4.9 million is to support State and private 
partnership efforts that will keep candidate species off the endangered 
list. In addition, much of the $8.6 million increase for consultation 
will be used to provide technical assistance to private landowners 
developing Habitat Conservation Plans. Last year, the Cooperative 
Endangered Species Fund included a pilot program of grants-to-States 
for land acquisition related to large-scale HCPs. These funds have been 
in high demand, and the Administration has again included $6.0 million 
in its budget to continue this program. The Conservancy strongly 
supports this example of a Federal program that encourages partnership 
initiatives on the ground.
                                 ______
                                 

  Prepared Statement of Hon. Jim Geringer, Governor, State of Wyoming

    This testimony supports the President's Recommended fiscal year 
1998 Budget relative to funding for the Bureau of Land Management [BLM] 
to accomplish Colorado River Basin Salinity Control activities
    This testimony supports fiscal year 1998 funding for the Bureau of 
Land Management [BLM] to carry out Colorado River Basin salinity 
control activities. You will soon receive testimony from the Colorado 
River Basin Salinity Control Forum [Forum] on behalf of the seven 
Colorado River Basin States that is being submitted by the Forum's 
Executive Director, Jack Barnett. The State of Wyoming concurs in the 
fiscal year 1998 funding request and justification statements for BLM 
funding set forth in the Forum's testimony.
    The State of Wyoming is one of the seven member states represented 
on the Forum and the Colorado River Basin Salinity Control Advisory 
Council. The Council was created by Section 204 of the 1974 Colorado 
River Basin Salinity Control Act, Public Law 93-320, and like the 
Forum, is composed of gubernatorial representatives of the seven 
Colorado River Basin states. Both the Council and Forum serve important 
liaison roles among the seven states, the Secretaries of the Interior 
and Agriculture and the Administrator of the Environmental Protection 
Agency (EPA). The Council is directed by statute to advise these 
federal officials on the progress of the federal/state cost-shared, 
basin-wide salinity control programs, and annually recommends to the 
Federal agencies what level of funding it believes is required to allow 
the Program to meet its objective of assuring continuing compliance 
with the basin-wide water quality standards.
    The Council met most recently in October, 1996 and developed 
funding recommendations for fiscal years 1998 and 1999 based on the 
progress the Programs are making in managing and reducing the salt 
loading into the Colorado River System. Based on analyses made by the 
Bureau of Reclamation and the Forum and after conferring with BLM 
agency officials, the Council recommends that the BLM expend $4,500,000 
in fiscal year 1998 to accomplish activities that BLM either has 
underway or should initiate in order to further control the 
concentrations of salinity of the Colorado River.
    It is particularly important that the BLM's line-item for 
Management of Lands and Renewable Resources be adequately funded. 
Section 203(b) of the Colorado River Basin Salinity Control Act as 
amended directs the Secretary of the Interior to develop a 
comprehensive program for minimizing salt contributions to the Colorado 
River from lands administered by the Bureau of Land Management. This is 
both important and appropriate because the BLM is the largest manager 
of land in the Colorado River Basin (53 million acres of public lands 
in the Colorado River Basin above Yuma, Arizona) and because salt 
loading reductions on BLM-managed rangelands can be done more 
economically than some of the methods available to and projects being 
implemented by the Bureau of Reclamation and the Department of 
Agriculture.
    The Council and Forum recognize the major role that the Bureau of 
Land Management can have in the Colorado River Basin salinity control 
effort if more attention, effort and focus by the BLM is brought to 
bear on controlling salt discharges from the federal lands it manages. 
Great opportunity exists to decrease salt loading from BLM-managed 
lands to the river system. The Secretary of the Interior is directed by 
the Colorado River Basin Salinity Control Act to give preference to 
those salinity control efforts which reduce salinity at the least cost 
per unit of salinity reduction, e.g. in the most cost-effective manner. 
The Forum and Council have aggressively urged, and will continue to 
encourage, the BLM to identify, plan and develop additional projects 
that will remove, or prevent the loading of, a greater tonnage of salts 
from the River system.
    The State of Wyoming wishes to emphasize the statement found in the 
Forum's testimony that while we are not opposed to BLM's budgetary 
process of focusing on ecosystem and watershed management, it remains 
essential that the expenditure of funds be directed to specific sub-
activities and that the accounting for expenditures be done in such a 
manner that monitoring can take place on how the funds were used, what 
resources were benefitted and which natural resource concerns 
addressed. Wyoming and the other member states of the Forum have been 
frustrated by BLM's approach of identifying where funds are allocated 
as opposed to what purposes or how they are used to accomplish specific 
activities, objectives and benefits. The same difficulty exists with 
regard to accounting for how allocated funds have been expended. The 
BLM is simply unable at the present time to indicate how much money it 
is spending or where it is being spent to achieve salinity control 
benefits. For this reason, the Forum expressed in its testimony a 
strong desire to have the Congress direct the BLM to implement or 
modify its existing accounting practices to enable the Basin States to 
understand how much money this agency is allocating, and what results 
are being obtained, in carrying out its mandate for implementing a 
comprehensive program to minimize salt contributions from lands it 
administers.
    Again, on behalf of the State of Wyoming, I wish to express our 
concurrence with the testimony that is being submitted by the Colorado 
River Basin Salinity Control Forum. Thank you for the opportunity to 
submit and for your consideration of this statement, and I would 
request that you make it a part of the formal hearing record on fiscal 
year 1998 appropriations for the Bureau of Land Management.
                                 ______
                                 

   Prepared Statement of Alice Kilham, Co-Chair, Upper Klamath Basin 
                             Working Group

    An innovative, results oriented approach to resolution of natural 
resource issues began in Oregon in 1995. The Upper Klamath Working 
Group, a community consensus group, is now seeking the support of 
Congress for the appropriation of funding for implementation of 
ecosystem restoration efforts in fiscal year 1998. By funding these 
projects, National pilots will be created that model not only 
cooperation among former competing interests, but demonstrate new ways 
to accomplish protection of National natural resource treasures while 
respecting economic and social needs.
    March 5, 1997, the Upper Klamath Basin Working Group reached 
consensus and identified restoration projects for implementation under 
the $1,000,000 authorized annually under the Oregon Resource 
Conservation Act of 1996 (H.R. 3610). These projects will be matched 
through partnerships which will double the benefits received beyond the 
federal funding. The following are the projects that have been 
identified and benefits expected:
    1. Restoration of the springs in Sprague and Williamson river 
systems, proposed by the Klamath Indian Tribes, $160,000. Restoration 
of the springs will provide improved water quality for endangered 
suckers and they are critical water sources during summer months for 
stream and river flows. This effort will benefit not only the immediate 
springs and tributaries but will benefit the entire watershed area 
including downstream salmon through improved water quality. Federal 
funds could be administered through the Fish and Wildlife Service's 
Partners Program or Endangered Species Recovery Program. The match will 
be provided by the Klamath Tribes.
    2. Pilot field trials to identify alternate pest control methods to 
be implemented in the Integrated Pest Management Plan on Tule Lake and 
Lower Klamath National Wildlife Refuges, proposed by New Horizons 
Technology, contractor to the U.S. Fish and Wildlife Service, $30,000. 
The results of these field trials will provide national leadership in 
implementation of lease land farming on National Wildlife Refuges. 
Federal funding could be distributed through the Bureau of 
Reclamation's Sump Rotation Account. The Klamath Basin Ecosystem 
Foundation would provide the match.
    3. Development of a juniper management program, proposed by Oregon 
Department of Fish and Wildlife & Klamath County Soil and Water 
Conservation District, $100,000. Implementation of a program to 
integrate Best Management Conservation Practices within the juniper 
woodland zone for juniper treatment, livestock grazing, road 
management, prescribed fire, and noxious weed control--all management 
actions that can improve watershed conditions. Furthermore, these 
practices will be applicable to Oregon's 2.2 million acres of juniper 
woodlands. Federal funds could be administered through Department of 
Agriculture's Natural Resources Conservation Service. The match will be 
provided by Klamath County Soil and Water Conservation District, 
landowners, and Oregon Department of Fish and Wildlife.
    4. Riparian fencing and wetland restoration at various locations, 
proposed by Ducks Unlimited Western Regional Office, Rancho Cordova, 
CA, $150,000. This partnership will contribute to the on-going 
restoration to benefit water quality and habitat while stabilizing the 
economy. Federal funds could be administered through the Fish and 
Wildlife Service's Partners program or Endangered Species Recovery 
Program. The match will be provided by Ducks Unlimited, landowners and 
California Department of Fish and Game.
    5. Riparian protection and stream structures on three parcels of 
private lands, proposed by Klamath Soil and Water Conservation 
Districts, $243,350. This partnership would open up a multitude of 
private lands for future restoration and ultimate resolution of 
ecosystem restoration needs. The direct immediate benefits are in water 
quality, fish habitat and recovery of endangered suckers. Federal funds 
could be administered through Department of Agriculture's Natural 
Resources Conservation Service. The match will be provided by 
landowners and the Klamath County Soil & Water Conservation District.
    6. Wetland restoration on Sevenmile Creek, proposed by Water For 
Life, $200,000. This pilot project will demonstrate the ability to 
improve the water quality of agriculture return waters. Presently 
nutrient rich agriculture waters are returned directly to the waters of 
the basin untreated. Federal funds could be administered through the 
Fish and Wildlife Service's Partners Program or Recovery Program. The 
match will be provided by private landowners.
    7. Support for Geographic Information System center at Oregon 
Institute of Technology, $123,000. OIT is willing to utilize its 
present space to meet a critical community need for GIS products, 
training and support. This funding would provide the match to OIT's 
contribution to allow for the acquisition of hardware and software to 
meet this need. This proposal is developed as a cooperative with 
Southern Oregon State University and Humboldt State College in 
California. Benefactors would be local resource agencies, businesses, 
agriculture community and individuals that are in need of accessing 
this information. The Department of Health Education and Welfare could 
be a vehicle to transmit funds. OIT will provide the match.
    8. Implement bull trout restoration strategy and install fish 
barrier to protect bull trout in Sun Creek, proposed by Bull Trout 
Working Group, $70,000. The status of bull trout in the basin is at a 
critical point. Listing as endangered or threatened is possible. A 
Basin strategy needs to be developed to provide direction for work 
ongoing and for future restoration actions. The Bull Trout Working 
Group has provided the leadership to start this process and is a local 
consensus group. Immediate restoration needs to be implemented not only 
to avoid extinction, but also to help resolve the economic and social 
concerns that will result from the continued threat to the species. 
Specifically restoration would be centered on habitat issues that would 
protect existing population segments. Federal funds could be 
administered through the Fish and Wildlife Service's Partners Program 
or Pre-Listing. The match to be provided by Oregon Department of Fish 
and Wildlife, Trout Unlimited, U.S. Timber Lands, Klamath County Soil & 
Water Conservation District.
    The following two projects were also endorsed for funding through 
the Interior Department budget:
    1. $500,000 for the continuing restoration of the Wood River Ranch 
by BLM. This is an ongoing restoration project of 3,200 acres. This 
project would create critical nursery habitat for endangered suckers. A 
partnership between BLM, Oregon Trout, Klamath Tribes, private land 
owners and others provides the kind of community support that sets a 
precedent. This is a continuation of efforts started in fiscal year 
1996.
    2. $1,220,000 for the pilot project for Sump Rotation on the Tule 
Lake National Wildlife Refuge. This is the most innovative approach to 
provide for long-term co-existence between farming and wildlife 
interests on a National Wildlife Refuge system. The program as 
supported by the Working Group has agreement from the farming and 
conservation communities that solution has to be reached to allow these 
two activities to co-exist and prosper. The Refuge benefits to 
migratory waterfowl goes without question, but equally important is 
lease land farming that may be dependent on sump rotation of crops and 
wetlands for its future. The leasing program is an important national 
program generating about $2 million dollars to the national treasury 
each year in use fees. Funding could be through the Fish and Wildlife 
Service's Refuge Administrative Program.
    The Upper Klamath Basin Working Group continues to be supported by 
a wide range of differing interest, Klamath Tribes, Oregon Department 
of Fish and Wildlife, Agriculture, Grazing, Industry, City of Klamath 
Falls, County of Klamath Falls, Conservation Groups, Oregon State 
Governor's Office and Federal Agencies. There is coordination with the 
other Basin restoration entities including the Klamath River Fisheries 
Task Force, The Klamath River Compact Commission and the Trinity River 
Task Force.
    We respectfully request that you appropriate the $1 million, as 
authorized under the Oregon Resources Conservation Act of 1996, for the 
eight restoration projects identified above for implementation in the 
Upper Klamath Basin for fiscal year 1998 and provide additional funding 
to accomplish the Wood River wetlands restoration and sump rotation on 
the Tule Lake National Wildlife Refuge. These restoration efforts will 
provide solutions that can lead to recovery of the endangered suckers, 
down stream salmonids and prevent potential future resource problems. 
They will also help the AG community, the City and County, the Klamath 
Tribes, and the Lower Klamath River commercial interests and tribes.
    Background history: Senator Hatfield first established the Upper 
Klamath Basin Working Group as a volunteer group, the ``Hatfield 
Klamath Basin Working Group'', in early 1995 following a July 6, 1994, 
Senate Hearing in Klamath Falls. Testimony at the Senate Hearing 
demonstrated a strong desire and willingness by the local community to 
resolve its environment/economic issues at the Basin level. The Senator 
felt the local people were knowledgeable about the issues, that they 
were a lot closer to consensus than apart on the issues, and that they 
wanted an opportunity to resolve their own issues. He therefore 
appointed a group of 27 people representing public and private 
interests to serve on the Hatfield Klamath Basin Working Group.
    The Senator's charge to the Upper Klamath Basin Working Group was 
to review issues in the basin and provide to him recommended solutions. 
The Senator specifically requested that the Working Group address: 1. 
Ecosystem Restoration; 2. Economic Stability; and 3. Reducing Drought 
Impacts. The Working Group was asked to identify short term 
recommendations for fiscal year 1996 and long term recommendations for 
out years. The Senator asked the group to work through consensus. Each 
member was chosen because they represent a segment of the community and 
through their consensus actions would provide community support and 
agreement. The Senator then pledged his support to help implement what 
the Working Group developed.
    The Working Group first met April 6, 1995, developed ground rules 
for their consensus process, and on May 17, 1995 the Working Group 
developed six short term projects and sent them to the Senator for 
inclusion in the fiscal year 1996 Budget. From the recommendations the 
Senator obtained $3,500,000 under the Wetland Reserve Program for 
Tulana Farms and $725,000 was added to the Service's Klamath Falls Fish 
and wildlife Service Office for riparian restoration.
    Tulana Farms wetland restoration is one of the nation's largest 
restoration effort to restore a river delta. When completed the 
restoration will put back 4,700 acres of riparian and wetland habitat 
that will benefit the endangered Lost River and shortnose suckers and 
improve water quality and quantity in Upper Klamath Lake. During the 
restoration phase New Earth and PacifiCorp will operate 1100 acres of 
agricultural in holdings to demonstrate the compatibility of farming 
and ecosystem restoration.
    The Tulana restoration project and the riparian restoration effort 
have provided for the development of significant partnerships and 
consolidated efforts of many diverse groups. Included are: The Nature 
Conservancy, Oregon Trout, Water for Life, the Klamath Basin Water 
Users Association, The Klamath Tribes, PacifiCorp, New Earth, Oregon 
Department of Fish and Wildlife, The Natural Resources Conservation 
Service, The Bureau of Reclamation, The Bureau of Land Management, The 
Forest Service, The Fish and Wildlife Service, The National Fish and 
Wildlife Foundation, The County of Klamath, The City of Klamath Falls, 
The Friends of the Winema, The Klamath County Soil and Water 
Conservation District, Industry and interested citizens.
    The Working Group developed a second set of recommendations for the 
fiscal year 1997 Budget that resulted in an additional $5,500,000 
million for restoration of Tulana Farms, $500,000 for BLM wetland 
restoration of the Wood River Ranch and an additional $500,000 for 
restoration by the Klamath Falls Fish and Wildlife Service Office. This 
funding has continued the above partnerships which not only wouldn't 
have been possible two years ago, but which generated a synergy to take 
on projects which would have been beyond the abilities of any one 
group.
    In order to insure the continued restoration of the Upper Klamath 
Basin on a consensus basis Senator Hatfield and Congress in 1996 
created the Upper Klamath Basin Working Group as a pilot public 
advisory committee authorizing $1 million per year for five years. The 
federal funds were to be matched by other funding. This authorization 
was supported by Federal Agencies, and the Oregon Congressional Group. 
The Act also provided for a coordination and communication group to be 
made up of two members each of the Trinity River Task Force, the 
Klamath River Compact Commission, The Klamath Fisheries Task Force and 
the Upper Basin Working Group. That group has met as the Klamath 
Watershed Coordinating Group three times in the last three months, and 
is optimistic about the opportunity to bring the entire Klamath River 
Watershed into a working whole.
                                 ______
                                 

    Prepared Statement of Trygve Sletteland, Pacific Rivers Council

    We urge the 105th Congress to take the following steps through 
appropriations legislation to increase the accountability of the Forest 
Service and the Bureau of Land Management for the protection and 
restoration of watersheds which provide clean water and fish habitat to 
the citizens of the west.
    1. Prohibit new roadbuilding on the National Forests and Bureau of 
Land Management public lands by ending any appropriation for new roads 
and by prohibiting the use of purchaser road credits to build new 
roads.
    2. Target fire-prevention funds to those areas where increased fire 
hazard threatens lives and property.
    3. Target ecosystem restoration funds to those locations and 
activities which are likely to have the greatest ecological benefits. 
In many cases, this will mean funding for activities that remove 
existing threats to salmon and trout habitat and water quality.
    4. Prohibit logging and road-building on unstable and potentially 
unstable national forest land. Recent landslides in the West have amply 
demonstrated the ``hidden costs'' to public safety and the environment 
of subsidized logging and road building on steep, unstable slopes.
    5. Link accomplishment of ecological goals to managers' performance 
reviews.
    A brief explanation of our rationale for these requests is provided 
below.
1. Eliminate roadbuilding subsidies and shift emphasis of roads program 
        to obliteration
    We urge the Committee to consider the fiscal and ecological 
benefits of using the appropriations process to prohibit new 
roadbuilding on the National Forests and Bureau of Land Management 
public lands by authorizing zero funding for new roads and by 
prohibiting the use of purchaser road credits to build new roads. We 
note that the President has taken the first step in this direction by 
eliminating purchaser road credits from his budget. At least one half 
of savings should go to targeted road decommissioning projects and 
improvement work designed to address the highest priority risks in the 
most ecologically sensitive watersheds.
    The enduring ecological impacts of reading are many and well-known:
    ``Roads may have unavoidable effects on streams, no matter how well 
they are located, designed or maintained. Roads modify natural 
hillslope drainage networks and accelerate erosion processes. These 
changes can alter physical processes in streams, leading to changes in 
streamflow regimes, sediment transport and storage, channel bank and 
bed configurations, substrate composition, and stability of slopes 
adjacent to streams. These changes have significant biological 
consequences that affect virtually all components of stream 
ecosystems.'' (Federal Ecosystem Management Assessment Team 1993).
    A prohibition on new roadbuilding would implicitly recognize the 
critical need to protect existing unroaded areas. There is an 
overwhelming consensus among natural resource agencies and within the 
scientific community that existing roadless areas are of extremely high 
ecological value. The literature points clearly to at least two 
conclusions which have management implications: (1) roadless areas are 
critical because they are the only undisturbed habitats on an almost 
universally disturbed landscape. As such, they are the de facto refuges 
for numerous aquatic, riparian-dependent and terrestrial species; (2) 
the reasons that these areas are roadless (high elevation, steepness 
and erodibility) are precisely the same reasons that they should be 
protected from reading and other management impacts: in these areas the 
risks to stream habitats from disturbance are extremely high.
    Removing subsidies for roadbuilding also is fiscally responsible 
given that the land management agencies are far from meeting current 
road maintenance needs. Reducing road mileage will decrease road 
maintenance backlogs and, ultimately, permit reductions in agency work 
force.
    As Congress has directed in past years, roads funding should be 
shifted to obliteration and re-engineering which addresses the risks to 
key watersheds and healthy salmon habitat regionwide. Projects should 
be selected which have the greatest impact on factors limiting salmonid 
spawning, rearing and holding habitat including sediment input, 
riparian cover etc. ``Projects which will have the greatest long-term 
positive impact on watershed conditions should be favored over those 
with short-term benefits.'' (House Appropriations Report, June 24, 
1993).
2. Target fire-prevention funds to those areas where increased fire 
        hazard threatens lives and property
    We urge the Committee to provide guidance that carefully targets 
current timber salvage and thinning and other ``forest health'' 
management efforts to focus our limited resources on the highest 
priority areas and while minimizing risks. These areas are those within 
the urban-wildland interface. Such targetting would be responsive to 
the desire to reduce the risks to life and property while 
simultaneously minimizing the risks forest health treatment could post 
to aquatic resources. This targeting is fully consistent with, and 
arguably required by, existing policies.
    For example, Agriculture Secretary Glickman's guidelines for last 
year's emergency salvage program directed that salvage sales be 
targeted to areas where forests * * * ``have high fuel loading or 
present a high fire risk and are near communities or occupied 
structures, such as homes * * *.'' Similarly, the interagency Federal 
Wildland Fire Management Final Report (USDA/USDI, December 16, 1995) 
reaffirmed protection of life and property as * * * ``the first 
priority in wildland fire management.'' This report clearly recognized 
that the key role for federal managers' in preventing fires in the 
intermix zone is to reduce fuel hazards affecting populated areas on 
the land they administer.
    The targeting we suggest is supported not only on the basis of 
human risks and values, but on purely ecological grounds as well. The 
conclusions of the blue-ribbon panel of scientists on the Aquatics Team 
of the Interior Columbia Basin Ecosystem Management Project support the 
need for extreme caution in subjecting ecologically sensitive 
watersheds to intensive fire-prevention treatments:
    ``Since past timber harvest activities have contributed to 
degradation in aquatic ecosystems, emphasis on timber harvest and 
thinning to restore more natural forests and fire regimes represents a 
risk of extending the problems of the past. * * * Attempts to minimize 
the risks of large fires by expanding timber harvest risk expanding 
well-established negative effects on aquatic systems. The perpetuation 
or expansion of existing road networks, and other activities might well 
erode the ability of [fish] populations to respond to the effects of 
fire as well as large storms and other disturbances that we cannot 
predict or control. (National Research Council, 1995).'' (Lee et. al., 
1996, ``A Broadscale Assessment of Aquatic Species and Habitats'' pre-
publication draft, Chapter VI).
    The Team's findings support an assumption that the ecological risks 
from vegetative manipulation to aquatic systems outweigh the benefits 
in relatively undisturbed (e.g. sparsely roaded) watersheds unless and 
until we have dependable information to the contrary:
    ``In our haste, forest-health treatment projects have been 
justified from all perspectives including the risk of extirpation for 
sensitive aquatic species. There is undoubtedly a point where the risk 
of fire outweighs the risk created by our management. Management 
creates risk of somewhat known magnitude, timing, and extent, whereas 
wildfire potential is less known in each of these respects. Therefore, 
that point needs to be discovered through careful evaluation and 
scientific study. * * * Risks of fire are likely most important for 
aquatic ecosystems that have been seriously degraded and fragmented. 
Watersheds that support healthy populations may be at greater risk 
through disruption of watershed processes and degradation of habitats 
caused by intensive management than through the effects of fire.'' 
(emphasis added).
3. Target ecosystem restoration funds to those locations and activities 
        that are likely to have the greatest ecological benefits.
    There is a need for clear guidance to focus watershed restoration 
efforts on those activities that have the greatest known positive 
impact on watershed function and riparian and aquatic habitats. Signals 
now are conflicting, and may lead the agencies to undertake 
experimental vegetative management activities that have little or no 
effect in addressing the most pressing ecological problems. We urge the 
Committee to provide guidance that effectively targets funding for 
ecosystem restoration to those activities with the greatest ecological 
benefits. In most cases, these activities will be those intended to 
protect and restore areas with relatively high water quality, 
relatively healthy salmon and trout habitat and high value for both 
aquatic and terrestrial species.
    In much of the federally managed forested watersheds of the west, 
this kind of targeting will result in funding for road re-engineering, 
obliteration and culvert improvements. On federal rangelands, livestock 
enclosures and riparian revegetation may be the top priority.
    The overwhelming weight of evidence suggests that the highest 
priority for federal lands restoration management in the Northwest is 
addressing road-related threats to streams and native fisheries and 
slope stability. The results of the recent storms have demonstrated 
clearly that logging and associated roads have reduced the ability of 
forested areas to withstand heavy rains. Far too many of our last best 
habitats for salmon, bull trout and other native fish were decimated by 
road-related landslides during the fall and winter of this year. Sadly, 
much of the damage to water quality and fisheries could have been 
prevented by more aggressive implementation of watershed restoration 
programs that already are established under existing federal plans and 
policies. We call on the Committee to meet funding needs, but also to 
provide clear direction to ensure these needs are met.
4. Permit natural recovery of watersheds by prohibiting logging and 
        roadbuilding--particularly post-flood reconstruction--on 
        unstable and potentially unstable national forest land. Recent 
        landslides in the West have demonstrated the ``hidden costs'' 
        to public safety and the environment of subsidized logging and 
        road building on steep, unstable slopes.
    The story is the same all over the Northwest: hillsides saturated 
with water are giving way, especially where they are weakened by roads 
and logging. In some watersheds, failures are occurring only because of 
roads. Pools and gravel bars, prime habitat for salmon and bull trout, 
are being filled with sediment. Stream channels are being scoured by 
debris torrents.
    In an ideal world, natural disturbances like these wouldn't pose 
any real threat to the survival of species like salmon and bull trout, 
because the effects of high runoff would not be as severe and there 
would be plenty of other habitat to cushion the blow. But today's 
landslides all are too often in some of the last remaining habitat of 
sufficient to sustain our ailing fisheries. There are places like 
Isabella Creek and the North Fork of the Clearwater River, which the 
Forest Service has recognized as ``priority watersheds'' for bull trout 
that are suffering as a result of logging and/or road induced flood 
damage.
    The message is clear: we have managed our lands to the point where 
even the last best places have been littered with time-bomb of our own 
making. In most cases, the bombs are clearcut hillsides and roads which 
have been poorly built and/or have been built in places where they nave 
should have been built at all.
    This committee has an opportunity to demonstrate that we have 
learned from what is happening. Roads exist on steep, unstable slopes, 
where the are sure to fail in heavy rains no matter how fancy the 
engineering. These roads, now blown, should not be rebuilt. Other 
roads, now flooded because of debris dams in streambeds, were built 
along valley bottoms. Instead of listening to the floods and letting 
them heal our rivers, the tendency is for land managers to go in and 
pull out woody debris to keep the channel out of the roadbed and to 
ensure bridge safety. (This was done by managers on the North Fork of 
the Boise River, where wood was removed to facilitate access to timber 
sale units.) In most cases, roads we are attempting to save through 
these measures are suffocating the stream by restriction it to a single 
channel, which prevents the creation of pools and off-channel habitat 
for fish and restricts its ability to handle future flood events. Many 
of these roads too, should not be rebuilt. This will mean that some 
timber sales cannot be harvested using conventional, and perhaps any, 
method, because they will be too expensive to access without roads. But 
the payoffs generated by a healthier watershed will be greater in the 
long run.
    The signals the earth is sending are unambiguous: we have used up 
our margin of safety. Given the high level of disturbance on the 
landscape, where even the most pristine of environments is threatened 
with road blowouts, the best option now is to stop kidding ourselves. 
Rather than trying to control natural disturbances, we should--wherever 
possible--let them play out. Just as forested ecosystems depend on fire 
to maintain their complexity and integrity, rivers depend on the 
irregular patterns of floods and droughts to maintain theirs.
5. Make Managers Accountable for Meeting Ecological Objectives by 
        Making them part of Performance Reviews of Line and Staff 
        Officers.
    Performance measures needs to be adjusted to meaningfully reflect 
the accomplishment of ecological goals. If the line and staff officers 
have an incentive to meet goals that are related to the attainment of 
aquatic conservation and other objectives, the decision makers will be 
required to more carefully consider the recommendations of the resource 
experts within the agency.
    Last year's Logging Rider clearly demonstrated the Forest Service's 
lack of accountability: healthy, green forests were logged as ``salvage 
sales,'' water quality was endangered in the name of ``forest health,'' 
and no record exists that any of the salvage sales sold under the rider 
generated funds for the U.S. Treasury or improved the ecological health 
of the watershed. As a result of the failure by the Forest Service to 
protect the full range of public lands values, both the ecological 
integrity of our forests and the interests of the taxpayers were 
sacrificed.
                                 ______
                                 
  Letter From J. Kevin Lackey, Conservation Programs Director, Rocky 
                        Mountain Elk Foundation
                                      Missoula, MT, March 18, 1997.
Hon. Slade Gorton,
Chair, Senate Interior Appropriations Subcommittee, Senate Dirksen 
        Office Building, Washington, DC.
    Dear Senator Gorton: The non-profit Rocky Mountain Elk Foundation 
(RMEF), a wildlife habitat conservation organization, was established 
in 1984 to ensure the future of elk, other wildlife and their habitat 
through cooperative conservation activities utilizing hundreds of 
government and non-government partnerships.
    The RMEF has efficiently operated with federal partners and would 
appreciate the Senate Interior Appropriations Subcommittee considering 
the following recommendations for the fiscal year 1998 budget:
                          u.s. forest service
    The USFS ``Elk Country'' initiative is part of the agency's 
Wildlife Habitat Management Program commonly known as ``Get Wild.'' The 
RMEF has cooperated with the USFS in this initiative to cumulatively 
accomplish over 685 USFS projects enhancing 806,811 acres of public 
lands. This project activity was completed with $3.2 million of RMEF 
funds and matched by $7.9 million of cooperator funds, including USFS 
and other contributions.
Wildlife habitat management budget
    The President's fiscal year 1998 budget proposes $29.9 million for 
the USFS Wildlife Habitat Management Program. RMEF recommends an 
additional $10 million for a total of $40 million to accomplish a 
larger portion of the $54 million worth of habitat management 
opportunities identified in current forest plans for the Get Wild 
programs.
Challenge cost share budget
    The USFS Challenge Cost Share Program (CCS) is a highly successful, 
popular and effective avenue to garner additional private funds for 
national forest fish and wildlife habitat improvement projects. As one 
of the earliest organizations to cooperate with the USFS in the CCS 
program, RMEF believes this program's effectiveness is becoming 
hampered by USFS budget reductions begun in fiscal year 1994. The 
budget decision to fund some operations and maintenance costs with 
wildlife habitat management dollars results in fewer CCS dollars 
available to match RMEF and other non-governmental organization dollars 
for actual ``on the ground'' projects. RMEF encourages the committee to 
appropriate $8 million of the additional recommended $10.1 million to 
the CCS program for the USFS's wildlife habitat management program in 
fiscal year 1998, thereby maintaining the momentum, efficiency and 
popularity this program currently enjoys. The RMEF also recommends the 
committee specify CCS funds be exclusively utilized for ``on the 
ground'' cooperative project activities and not for USFS administrative 
purposes.
Seeking common ground initiative
    The Seeking Common Ground Initiative (SCG) is a successful national 
partnership effort addressing livestock/big game interaction on western 
rangelands. This endeavor is comprised of the RMEF, USFS, BLM, 
International Association of Fish and Wildlife Agencies, National Fish 
and Wildlife Foundation, American Farm Bureau Federation, National 
Cattleman's Association, Public Lands Council, National Rifle 
Association and the Wildlife Management Institute. The SCG goals are as 
follows:
    1. Improve public and private rangeland condition.
    2. Promote individual stewardship that improves rangeland 
resources.
    3. Improve communications among rangeland users.
    4. Reduce real and perceived habitat conflict between wildlife and 
livestock.
    5. Encourage problem-solving at the local level.
    This program has more potential to advance positive action 
affecting public and private rangelands than any other activity today 
because of the program's emphasis on cooperative action to achieve 
mutually shared goals. RMEF supports the committee providing $250,000 
designated specifically to this program in fiscal year 1998. These 
additional funds would be leveraged to obtain matching funds from other 
private partners, thereby financing expanded activities including SCG 
national demonstration projects. The appropriated funding would best 
serve the SCG program if one-half ($125,000) of the funds were 
allocated to the USFS fish and wildlife program and one-half ($125,000) 
to the range program.
                       bureau of land management
    The BLM has been a much more active partner with RMEF as a result 
of what we recognize as increased attention to fish and wildlife 
programs on public lands. An increased effort on behalf of the agency 
to fund additional wildlife habitat work on its 270 million acres would 
be in line with today's demands for increased wildlife and related 
recreation on public demands. To date, RMEF has contributed $1.1 
million to 206 projects on BLM lands, enhancing 170,912 acres of 
wildlife habitat under BLM jurisdiction.
National Fish and Wildlife Management budget
    Fish and wildlife habitat management within the BLM is proposed to 
receive a fiscal year 1998 appropriation of $27.7 million. Although 
this amount is an increase over fiscal year 1997 the RMEF would 
encourage the committee appropriate a fiscal year 1998 total of $30 
million for fisheries ($1.15 million additional) and wildlife ($1.15 
million additional) programs to promote habitat work on BLM lands 
identified in the agency's Fish and Wildlife 2000 strategic planning 
document.
Seeking common ground initiative
    The RMEF also encourages the committee to appropriate to the BLM 
over and above the $30 million an additional $250,000 for the Seeking 
Common Ground effort mentioned above. As a full SCG partner the BLM 
would utilize the funds to secure additional private matching funds for 
the restoration and enhancement of wildlife and livestock habitat on 
public lands. RMEF would suggest the funds be evenly divided between 
the BLM's range and wildlife programs, thereby emphasizing the 
cooperation necessary to continue the program's success.
                     u.s. fish and wildlife service
    RMEF strongly supports a $200 million fiscal year 1998 budget for 
refuge operation and maintenance. RMEF's opportunity to form additional 
partnerships with the USFWS, particularly in those areas of high public 
interest such as the National Elk Refuge in Jackson, Wyoming; can be 
greatly enhanced by the USFWS investing in modern public information/
education and refuge management facilities.
                 national fish and wildlife foundation
    RMEF recommends the committee provide fiscal year 1998 National 
Fish and Wildlife Foundation (NFWF) funding at $10 million as follows: 
USES: $1.5 million; BLM: $1.5 million; USFWS: $7.0 million). NFWF has 
become RMEF's leading project cooperator by providing over $530,000 in 
matching funds for wildlife habitat conservation. NFWF's aggressive 
matching funds requirements focuses private sector fundraising efforts 
for many organizations and has resulted in effective utilization of the 
appropriated federal dollars. NFWF's effectiveness is key to its 
partner's successes and this formula should be expanded through 
increased funding.
    On behalf of its over 100,000 members, the Rocky Mountain Elk 
Foundation appreciates this opportunity to provide comment to the 
appropriations subcommittee. Thank you for your support.
            Sincerely,
                                           J. Kevin Lackey,
                                    Conservation Programs Director.
                                 ______
                                 
 Letter From Warren T. Doolittle, President, International Society of 
                        Tropical Foresters, Inc.
                                       Bethesda, MD, March 5, 1997.
Hon. Slade Gorton,
Chair, Senate Appropriations Subcommittee on Interior and Related 
        Agencies, U.S. Senate, Washington, DC.
    Dear Senator Gorton: As a former Associate Deputy Chief for Forest 
Service Research during the 1970's, I am deeply concerned with the 
Forest Service research budget for 1998. The reduction of line items in 
the budget from four to one line item makes it especially difficult to 
focus on and follow the diverse segments of the overall research 
program. And, the reduction of funding from $193,509,000 for 1995 down 
to the President's budget of $179,786,000 for 1998 is especially 
detrimental to the program. The trend of these reductions has resulted 
in the loss of many important projects and valuable scientists.
    The reductions in funds and in scientists come at a very critical 
time in the need for providing the scientific information and 
technology essential to the protection, management, use, and 
sustainability of the nations 1.6 billion acres of forests and 
rangelands. With the new direction of the Forest Service and other land 
managers to manage natural resources according to the principles of 
ecosystem management, there is urgency to move ahead promptly with a 
blend of new basic research and a continuation of older long-term 
research to meet the needs of people at both the local and national 
levels in providing forest products, diversity, and recreation--with 
sustainably managed forests.
    Forest Service Research describes its program under four broad 
areas:
    1. Vegetation management and protection;
    2. Wildlife, fish, water, and air sciences;
    3. Resource valuation and use;
    4. Forest resources inventory and monitoring.
    The reduction in funding especially hurts the research efforts in 
the first three areas above. Research had 708 scientists in 1985, and 
since that time there has been a gradual attrition of budgets and 
scientists--down to 548 scientists with the proposed President's 
budget. These incremental reductions have resulted in drastic losses of 
key scientists and valuable, long-term research in the so called 
foundation areas--which often require many years for forests to respond 
to experimentation.
    In summary, the research efforts of the Forest Service are going 
down exactly at a time when they should be going up. I implore you to 
reconsider the reductions being made in the research budgets, and 
restore the programs to a level of at least $200 million.
    Please let me know if I can be of any further assistance on Forest 
Service research.
            Sincerely,
                                       Warren T. Doolittle,
                                                         President.
                                 ______
                                 
 Letter From Warren T. Doolittle, President, International Society of 
                        Tropical Foresters, Inc.
                                       Bethesda, MD, March 5, 1997.
Hon. Slade Gorton,
Chair, Senate Appropriations Subcommittee on Interior and Related 
        Agencies, U.S. Senate, Washington, DC.
    Dear Senator Gorton: I am writing this letter to you because of my 
deep concern for the international program in the USDA Forest Service. 
My name is Warren T. Doolittle--the elected President of the 
International Society of Tropical Foresters, Inc. [ISTF].
                           background on istf
    ISTF was first organized in 1950 and chartered as a--nonprofit 
scientific society of Washington, D.C., in 1979. ISTF is committed to 
the management, protection, and wise use of the world's tropical 
forests. This commitment is carried out through a network of about 2000 
members in 115 countries--including the tropical, developing counties 
and most developed countries.
    ISTF publishes a quarterly newsletter in English, Spanish, and 
French; publishes an annual Membership Directory; distributes 
publications on tropical forests; sponsors workshops and symposia; 
organizes chapters of ISTF; and generally serves as a source of 
information for ISTF members.
                        tropical forest research
    Over the years, the Forest Service has carried out a modest program 
in tropical forest research with funding included as part of the 
regular research budget with programs for the International Institute 
of Tropical Forestry in Rio Piedras, Puerto Rico; the Institute of 
Pacific Island Forestry in Honolulu, Hawaii; and the Forest Products 
Laboratory in Madison, Wisconsin.
    The research budget for the International Institute of Tropical 
Forestry in Puerto Rico was $3,116,000 in 1995. However, the 
President's budget for 1998 is $2,797,000. This level of funding means 
that research on the social and economic values of tropical forestry 
and on non-traditional forest products will not be continued. And, only 
the more critical issues of ecosystem management, reforestation of 
degraded lands, natural regeneration, and management of secondary 
forests will be pursued with a lesser capability.
    The research budget for the Institute of Pacific Island Forestry in 
Hawaii was $1,667,000 in 1995. And, the President's budget for 1998 is 
$1,650,000. However, for 1997, the Washington office (Research) 
provided another $629,000 (for one year only) to bring the total 1997 
budget to $2,100,000. This enabled the Institute to move ahead with 
research on the restoration and management of tropical forests in 
Hawaii and the Pacific region. It is important that the 1997 level be 
maintained in the budget for 1998.
    The Forest Products Laboratory budget for research in the tropics 
was $925,000 in 1995; it was reduced to $635,000 in the President's 
budges for 1998. This downward spiral in budgeting means that critical 
progress being made on the utilization of lesser known tropical 
hardwoods and work on lumber grades for these species will be greatly 
slowed.
    I recommend that Congress restore the regular international 
forestry budgets of the two institutes and the Forest Products 
Laboratory to the fiscal year 1995 level.
                  international forestry (nonresearch)
    The International Forestry (nonresearch) line item budget for 1995 
was $7,000,000 and the President's budget for 1996 was $10,000,000. 
However, Congressional recisions made in 1995 reduced the $7,000,000 
figure down to $5,000,000, and the line item for 1996 and 1997 was 
zeroed. In place of the line item budget an agreement was reached that 
the Forest Service could spend up to $3,000,000 in 1997 and 1998 from 
the overall Forest Service budget.
    This reduction in budget for international activities could not 
have come at a worse time for forestry. Globally, and especially in the 
tropics, forests are being depleted at an unprecedented rate, and there 
is a great need for solid leadership and demonstration in forestry.
    There is currently a worldwide effort by members of the 
environment, industry, and governments to come up with guidelines and 
assistance to provide sustained management for the world's forests. The 
Forest Service had built up a competent staff and forward looking 
program to face the multiple facets of sustained management; product 
certification; and cooperative research and technical efforts in 
meeting the challenges in forestry. However, Forest Service 
participation has been crippled and reduced at this critical juncture 
of time. Meanwhile environmentalists and others are moving ahead with 
planning and assistance that the Forest Service cannot match with a 
$3,000,000 budget.
    The world's forests provide wood and non-wood products, soil and 
water protection, biodiversity, and sequestration of carbon dioxide as 
a deterrent to global warming. This is no time for the United States to 
allow other interests make critical decisions on forestry.
    I strongly recommend that Congress restore the $7,000,000 budget 
level of 1995--and if possible even raise it to the earlier proposed 
1996 level of $10,000,000.
    Please let me know if I can provide any further information on 
international forestry.
            Sincerely,
                                       Warren T. Doolittle,
                                                    ISTF President.
                                 ______
                                 

 Prepared Statement of Andrea L. Colnes, Director, the Northern Forest 
                                Alliance

    Mr. Chairman and members of the Subcommittee, I want to thank you 
for taking testimony on the fiscal year 1998 budget request for natural 
resource programs under your jurisdiction. I am Andrea Colnes, Director 
of the Northern Forest Alliance, a coalition of more than 30 State, 
regional and national organizations representing more than one million 
members who have come together to promote strategies for the protection 
and stewardship of more than 26 million acres of some of America's most 
significant forests across the northern tier of New York, Vermont, New 
Hampshire and Maine.
    This is by far the largest remaining wild forest in the East, and 
is an incomparable natural resource for the people of the region and 
the nation. The vast, contiguous Northern Forest features the highest 
and most rugged mountain ranges in the Northeast; some of the very best 
free-flowing rivers in America; thousands of ponds and lakes that have 
to date escaped the irreversible impacts of development; and a forest 
that, if managed wisely, can provide a steady supply of timber while 
preserving important wildlife habitat and scenic beauty and serving as 
a destination for hunting, fishing, camping, hiking, snowmobiling, and 
other recreation uses.
    We have a unique opportunity to work together to protect the 
region's most important Wildlands; to promote the sustainable 
production of wood products from these forests; and to improve and 
expand resource-dependent local economies and communities. With funding 
provided by this Subcommittee, the Northern Forest Lands Council worked 
over four years with thousands of citizens and organizations 
representing a wide range of interests to develop 37 specific 
recommendations for state and federal action to conserve the Northern 
Forest.
    These recommendations are a reflection of the strong public support 
that exists across the region for protecting the resources, communities 
and way of life that is dependent on sustainable management of these 
forests. One of the key recommendations in the Council's report is 
support for public land acquisition as an essential part of a strategy 
for the future of the region. The Council called public land 
acquisition ``an important tool in protecting components of the full 
range of values in the Northern Forest.'' In response each of the four 
states has either established a land acquisition planning process that 
covers its portion of the Northern Forest, or has engaged in deciding 
strategies to protect important areas in the region. The Council 
recognized, however, that the states will need to work in partnership 
with the federal government to achieve these goals.
    Last Congress the Senate passed the Northern Forest Stewardship 
Act, a bill which would implement many of the recommendations of the 
Northern Forest Lands Council concerning land protection, sustainable 
forest management, and measures to strengthen local and regional 
forest-based economies. If this bill becomes law, it would provide 
explicit authority to the federal govermment--at the request of any of 
the four states--to use either the federal side or the state share of 
the Land and Water Conservation Fund to help finance acquisition of 
important Northern Forest conservation lands. This would provided long 
overdue access to a fair share of LWCF money to the people of New 
England. The Stewardship Act would authorize purchases from willing 
sellers only from the Fund.
    As an important step towards achieving the goals embodied in the 
Northern Forest Stewardship Act and implementing a comprehensive 
strategy to conserve the Northern Forest, the Northern Forest Alliance 
has identified a region-wide system of 10 proposed Wildlands across the 
four states. These areas contain lands vital to the region's forest 
produ. cts and recreation economies. A detailed description and 
discussion of possible protection strategies for these areas is 
attached to my testimony.
    Protecting the following parcels from possible development would be 
a critical forest step towards achieving a longer-term vision for the 
Northern Forest. In particular, seven projects involving more than 
80,000 acres of critical forest lands require immediate funding from 
the Land and Water Conservation Fund and the Forest Legacy Program if 
they are to be protected from imminent sale and development. By making 
this commitment, you would also indicate renewed support for the 
beleaguered Land and Water Conservation Frond which has served the 
people of our country so well for so long. fiscal year 1998 Northern 
Forest acquisition priorities
           fiscal year northern forest acquisition priorities
Urgent
    Lake Tarlton, NH: 2,000 acres estimated.
    Public acquisition cost: $2.7 million.
    Request for Federal LWCF funds: $2.7 million.
    An appropriation from LWCF in fiscal year 1998 will complete the 
federal portion of this important project, started last year. Federal 
funds will leverage an additional $1.4 million investment from state 
and private sources to help protect the scenic and ecologically rich 
shore of Lake Tarleton and the surrounding forest including three 
lakes--Tarleton, Katherine, and Constance.
Urgent
    Whitney Estate, NY: 15,000-20,000 acres.
    Estimated public acquisition cost: $25-50 million.
    Request for State LWCF funds: $10 million.
    Fifteen thousand acres of the ``Whitney Estate,'' a 51,000-acre 
tract in the heart of the Oswegatchie Great Forest, has been subdivided 
and offered for sale. This sale would fragment a critical stretch of 
forestland including more than 40 lakes and ponds, some of which form 
the headwaters of the Beaver, Raquette, and Bog rivers and the largest 
private lake in the Adirondacks.
Urgent
    Long Trail, VT: 1,060 acres.
    Estimated public acquisition cost: $325,000.
    Request for State LWCF funds: $162,500.
    Seven key parcels on the northern section of Vermont's Long Trail, 
the Nation's oldest long-distance hiking trail, are for sale, 
jeopardizing the trail's continuity. These seven parcels, totaling 
1,060 acres, include 3.5 miles of the Long Trail itself, which runs the 
length of Vermont along the crest of the Green Mountains. More than 
200,000 Vermont residents and visitors hike sections of the trail 
annually, contributing significantly to Vermont's tourism economy.
Urgent
    Fish Creek Watershed, NY: 30,000-40,000 acres.
    Estimated public acquisition cost: $7.5 million.
    Request for forest legacy funds: $5.625 million.
    An opportunity exists to protect 30,000-40,000 acres of 
irreplaceable watershed in the core of New York's Tug Hill Plateau with 
a combination of full fee purchase and conservation easement. The Fish 
Creek watershed lies within the Tug Hill area and provides drinking 
water to several cities and communities, including Rome and Oneida. 
Citing threats from land speculation and development, American Rivers 
has included Fish Creek in its list of the ``Most Threatened Rivers'' 
in the Nation for 2 years.
Urgent
    Green River Reservoir, VT: 6,350 acres.
    Estimated public acquisition cost: $2 million.
    Request for forest legacy funds: $1.5 million.
    Surrounding the 1,000-acre Green River Reservoir, this Forest 
Legacy project consists of more than 6,000 acres of forestland in 
northern Vermont. The property includes the state's longest length of 
undeveloped shoreline, approximately 19 miles, and has been top on the 
state's Forest Legacy list, stalled only by last year's recision of 
Forest Legacy funds.
Urgent
    Nicatous Lake, ME: 22,000 acres.
    Estimated public acquisition cost: $4 million.
    Request for forest legacy funds: $3 million.
    Nicatous Lake is known for its high concentration of ecological, 
recreational, and economic values. This project would protect more than 
27 miles of shoreline on Nicatous Lake which is listed in ``Maine's 
Finest Lakes'' for its outstanding wildlife, scenic, and shore 
character resources, significant fisheries and cultural features.
Urgent
    Upper Richardson Lake, ME: 5,122 acres.
    Estimated public acquisition cost: $2.2 million.
    Request for forest legacy funds: $1.65 million.
    The Upper Richardson Lake project presents the Forest Legacy 
Program with an opportunity to ensure that more than 5,000 acres stays 
in timber production and to protect 13 miles of lake shore. Residents 
and recreationists seek out Upper Richardson Lake for its fishing, 
hunting, remote camping, snowmobiling, and outstanding visual beauty.
    Pond of Safety: 9,880 acres
    Estimated public acquisition cost: $2 million.
    Request for forest legacy funds: $1.5 million.
    The Pond of Safety property spans more than 12,000 acres along the 
boundary of the White Mountain National Forest. A Forest Legacy 
Program, easement on 9,880 acres would link two surrounding sections of 
the National Forest, buffer it from development, guarantee continued 
public access for recreation, and protect important timber lands.
    Champion Lands, NY: 95,000 acres.
    Estimated public acquisition cost: $12-15 million.
    Request for forest legacy funds: $6 million.
    Request for State LWCF funds: $3 million.
    Without a combination of funding from the LWCF State Grants program 
and the Forest Legacy Program, extensive, high-value lands owned by 
Champion International along remote, pristine rivers in the northwest 
area of the Adirondack Park may be lost to fragmentation and 
development. LWCF money would be used for outright purchase of river 
corridors. Forest Legacy funds would enable the State to purchase an 
easement on the adjoining forestland, ensuring that the bulk of this 
95,000-acre holding remains in productive timber management.
    Lake George, NY: 400 acres
    Estimated public acquisition cost: $3.5 million.
    Request for State LWCF funds: $1.75 million.
    On the shores of Lake George, the ``Queen of American Lakes,'' an 
incredible 2.5 miles of pristine lake frontage is being offered for 
sale--and is in jeopardy of being developed and permanently closed to 
the public. This tract on the northeastern shore includes more than 400 
acres of forested mountain slopes and is an integral part of the 
undeveloped scenic landscape that supports the region's tourism economy 
which draws tens of thousands of visitors each year.
    Domtar Lands, NY: 105,000 acres.
    Estimated public acquisition cost: $10-15 million.
    Request for forest legacy funds: $6 million.
    In the heart of the Adirondack Park, Domtar Industries is offering 
a conservation easement on 105,000 acres of contiguous, high value 
forestland. While the property has been managed for a continuous flow 
of forest products, the 105,000-acre tract--and the jobs it supports--
could be lost to fragmentation and development.
    Mattavamkeag Lake: 4,195 acres.
    Mattawameag River, ME: 11,218 acres.
    Moose River, ME: 4,525 acres.
    Estimated public acquisition cost: $2.8 million.
    Request for Forest Legacy Funds: $2.1 million.
    These three projects together contain a high concentration of 
public values including recreational assets, productive forest land and 
wildlife habitat. A total of 38 miles of shoreline would be protected 
from development through Forest Legacy easements which would help 
protect the region's water quality and provide valuable recreational 
resources for anglers and boaters.
Total requested appropriations
    14 projects: 331,813 acres.
    Fiscal year 1998 priority request:
    Forest legacy program: $11.8 million.
    State LWCF funds: $10.16 million.
    Federal LWCF funds: $2.7 million.
    Total estimated Public Acquisition cost: $107 million.
    I also want to mention that the Alliance is a founding member of 
the new Americans For Our Heritage and Recreation coalition, an 
alliance of national, regional, State, and local organizations 
dedicated lo renewing and strengthening our Nation's investment in 
places that conserve our natural and cultural heritage and provide 
recreational opportunities for all Americans. We are determined to see 
the Land and Water Fund receive the full $900 million authorization 
annually, or to create an alternative that facilitates the protection 
of conservation lands, cultural and historic sites, urban parks, and 
expands outdoor recreation at the State and Federal levels. For fiscal 
year 1998, the coalition seeks an appropriation of $400-500 million to 
fund the top tier of the tremendous national backlog of State and 
Federal LWCF projects. It is particularly important that the state side 
of LWCF be re-vitalized to serve critical land conservation needs of 
urban and rural Americans across the country.
    Mr. Chairman, protection of these outstanding places represents a 
tremendous opportunity to conserve places of extraordinary natural and 
public value. It would also represent the continued commitment of 
Congress to work with the people of Maine, Vermont, New Hampshire, and 
New York to protect the irreplaceable resources of the Northern Forest 
for future generations of Americans. Thank your for considering this 
request.
                                 ______
                                 

  Prepared Statement of Daniel R. Dessecker, Forest Wildlife Biologist

    The Wildlife Habitat Management Program of the United States Forest 
Service is that portion of the Wildlife and Fisheries Budget Line Item 
that funds habitat management initiatives on our National Forests for 
wildlife species that are not classified as Threatened or Endangered.
    In 1994, the Wildlife Habitat Management Program was reduced by 
$9.5 million (22 percent). These funds were transferred to the newly 
established Ecosystem Planning, Inventory and Monitoring Program 
[EPIM]. In 1997, the now separate EPIM budget line item totaled $130 
million.
    The transfer of significant funds from well-supported, identifiable 
programs such as the Wildlife Habitat Management Program to EPIM, which 
is sufficiently broad to preclude and/or include virtually any 
expenditures renders it difficult to hold the Forest Service 
accountable for these expenditures. In addition, recent shortfalls in 
support for the Wildlife Habitat Management Program have hampered the 
timely implementation of resource management activities, including 
wildlife habitat management initiatives associated with timber sales, 
important to the conservation community.
    The Ruffed Grouse Society and other conservation organizations have 
long supported the Wildlife Habitat Management Program and have 
provided both technical and financial assistance to the Forest Service 
to capitalize on potential cooperative opportunities. Such 
opportunities are becoming increasingly scarce as reduced funding for 
this Program has forced the agency into the unenviable position of 
refusing partnerships and associated contributions.
    The Ruffed Grouse Society encourages the Interior Appropriations 
Subcommittee of the Senate to give serious consideration to returning 
funds to the Wildlife Habitat Management Program that have, since 1994, 
been diverted to EPIM. This return of approximately $10 million would 
translate into increased agency accountability and increased on-the-
ground habitat management accomplishments.
                                 ______
                                 

   Prepared Statement of Steve Holmer, Campaign Coordinator, Western 
                        Ancient Forest Campaign

    Chairman Gorton, thank you for this opportunity to testify on 
Forest Service Appropriations. The Western Ancient Forest Campaign 
represents organizations and individuals nationwide who are dedicated 
to protecting forest ecosystems on the National Forests.
    Working in conjunction with over forty other organizations, we have 
developed a Grassroots Forest Appropriations Initiative intended to 
outline a series of steps that we hope will help protect forest 
ecosystems and at the same time, help restore accountability to the 
U.S. Forest Service.
    Increasing evidence demonstrates that over the past two decades, 
our National Forests have suffered too much logging and too much 
roadbuilding with little concern about the impact these activities have 
on our clean water supplies, fish and wildlife, recreational 
opportunities and the numerous other values our public lands provide.
    Under the Salvage Logging Rider which suspended environmental laws 
and a citizen's right to have those laws enforced and participate in 
how their own lands were being managed, we witnessed the logging of old 
growth forests that had been protected by the courts. Under the rider, 
the guise of logging dead and dying trees was used to log large, green 
trees. Unroaded areas, which represent some our nation's last 
unprotected wilderness were entered and logged. The government's own 
Interagency Report on the Implementation of the Rider confirmed these 
abuses. And to their credit, the Administration's Glickman Directive 
halted some but not all of these abuses.
    In the aftermath of the rider, several lessons are clear. Our 
environmental laws and public processes should never again be 
suspended. Ancient Forests, roadless areas and riparian zones need 
permanent protection. And the U.S. Forest Service needs to be reformed 
and made more accountable.
    We offer The Grassroots Forest Appropriations Initiative to 
identify some specific ideas to help restore accountability to the 
agency and help stop the abuses that continue to threaten our forest 
heritage. Here are the four points in the initiative:
   the grassroots forest appropriations initiative (fiscal year 1998)
    The Timber Logging Rider clearly demonstrated the Forest Service's 
lack of accountability: healthy, green forests were logged as ``salvage 
sales,'' water quality was endangered in the name of ``forest health,'' 
and no record exists that even a dime from any of the salvage sales 
sold under the Rider made its way to the U.S. Treasury. As a result of 
the failure of the Forest Service to protect the full range of forest 
values in the National Forests under their management, both the 
ecological integrity of our forests and the well being of federal 
taxpayers were sacrificed.
    We urge the 105th Congress to take the following steps to restore 
the accountability of the Forest Service and protect the interests of 
both taxpayers and our natural environment:
    1. Prohibit new roadbuilding on the National Forests by ending any 
appropriation for new roads and by prohibiting the use of purchaser 
road credits to build new roads.--The elimination of purchaser road 
credits in the President's budget is a good first step.
    2. Prohibit logging and road-building on unstable and potentially 
unstable national forest land.--Recent landslides in the West have 
demonstrated the ``hidden costs'' to public safety and the environment 
of subsidized logging and road building on steep, unstable slopes.
    3. Restore accountability by reforming or abolishing off-budget 
funds.-- There is a growing consensus that the various off-budget 
funds--the Knutson-Vandenberg (KV), Brush Disposal and Salvage Funds--
must be either reformed or abolished. The Green Scissors Coalition 
urges abolishing the Salvage Fund and the Clinton Administration 
proposes new limits on this fund in the 1998 budget. The Administration 
has also proposed the creation of a new fund for ecosystem restoration 
called the Forest Ecosystem Restoration and Maintenance Fund (FERM). 
While we support the intent of the new FERM fund, as currently 
envisioned it would only perpetuate the same perverse incentive to log 
that plague the other funds. Instead, we support the Administration's 
request for $30 million of appropriated funds for restoration 
activities and urge Congress to appropriate necessary funds for 
restoration rather than creating another off-budget fund.
    4. End money-losing timber sales.-- The annual report of the White 
House Council of Economic Advisors shows that the Forest Service spent 
$234 million more than it collected in timber receipts in 1995. 
``Generally, the Forest Service subsidizes timber extraction from 
public lands by collecting less timber sale revenues than it spends on 
timber program costs,'' the report says. According to the Government 
Accounting Office (GAO) the timber sale program lost nearly $1 billion 
from 1992-1994. For the sake of both the environment and the taxpayer, 
it is time to end subsidized logging on the National Forests. This 
initiative has been signed by over one hundred groups including Sierra 
Club, The Wilderness Society, California Wilderness Coalition, Federal 
Forest Reform, Headwaters, Inland Empire Public Lands Council, Klamath 
Forest Alliance, Northcoast Environmental Center, Oregon Natural 
Resources Council, Northeast Ohio Sierra Club, Northwest Ecosystem 
Alliance, Oregon Natural Resources Council and the Western North 
Carolina Alliance.
    To implement this initiative in the Interior appropriations bill we 
urge the Committee to:
    1. Eliminate funding for new timber roads and include language to 
direct the agency to prohibit timber sales in Ancient Forests, roadless 
and riparian zones.--In testimony before the Senate Energy Committee on 
February 25, 1997, Chief of the Forest Service Michael Dombeck 
testified, ``The unfortunate reality is that many people presently do 
not trust us to do the right thing. Until we rebuild that trust and 
strengthen those relationships, it is simply common sense that we avoid 
riparian, old growth and roadless areas.'' We urge the Committee to 
support Chief Dombeck's effort to reform the agency and restore the 
public's trust by adopting his common sense recommendation.
    2. Include language to prohibit logging and roadbuilding on 
unstable and potentially unstable National Forest land.
    3. Support the Administration's $30 million request for prescribed 
fire and restoration activities, provided that these activities be 
limited to non-commercial pilot projects to guide future restoration 
efforts.--While we recognize that there is a substantial backlog of 
needed forest rehabilitation work, there is substantial evidence that 
the agency is not spending current restoration or prescribed fire 
dollars in an appropriate fashion. For example, some restoration money 
is being spent removing logging slash which should have been cleaned up 
by logging companies as part of the timber sale. There is also concern 
that prescribed fire has been inappropriately used to convert forest 
types in violation of restrictions placed on type conversion found in 
the National Forest Management Act.
    We urge the committee to be very specific in how the restoration 
money is to be spent as occurred on the watershed restoration money 
appropriated under the Northwest Forest Plan. Further, we urge the 
committee to prohibit restoration activities that subsidize or in any 
way further logging operations by the agency.
    4. Oppose the creation of any new off-budget fund for the agency.--
The other off-budget funds have been consistently abused by the agency 
and have created strong incentives to log even when other activities 
may be more appropriate.
    5. Prohibit the agency from offering any timber sales that will 
cost more than the agency can expect to receive in receipts for the 
sale.--The timber sale program lost $445 million in 1995 according to 
an independent analysis. According to the White House Council of 
Economic Advisors and the Government Accounting Office the program 
loses money. It is time to end this subsidy to the timber industry.
    Thank you again for this opportunity to testify, we look forward to 
working with the Subcommittee to realize these needed environmental and 
fiscal reforms.
                                 ______
                                 

 Prepared Statement of Lauri G. Aunan, Executive Director, Friends of 
                           the Columbia Gorge

    Mr. Chairman and Subcommittee Members, thank you for the 
opportunity to submit this testimony in support of appropriations for 
vitally needed U. S. Forest Service land acquisition and payments to 
local governments in the Columbia River Gorge National Scenic Area. 
This testimony is submitted on behalf of Friends of the Columbia Gorge 
(``Friends'') and its approximately 1,700 members in the Northwest and 
throughout the country.
    In 1986, the Congressional Delegations of Oregon and Washington 
State worked in tandem to pass legislation creating the Columbia River 
Gorge National Scenic Area. When President Reagan signed that 
legislation into law on November 17, 1986, he finalized the 
establishment of one of the most unique federal designations for one of 
the most spectacular places in the world.
    Since the enactment of the Scenic Area Act 10 years ago, Congress 
has worked diligently in a bipartisan way to meet its commitments and 
fund the programs authorized under the Act. These programs include land 
acquisition, economic development, payments to local governments, 
development of recreational facilities, and protection of cultural 
resources. We applaud the courageous stand originally taken by Congress 
to create the Scenic Area and its diligent efforts to implement the 
law. Much more, however, remains to be accomplished.
    To continue the legacy of commitment to both the natural and human 
resources of the Columbia Gorge National Scenic Area, we strongly 
recommend two funding priorities for the Scenic Area for fiscal year 
1998. The first priority is adequately funding the Scenic Area land 
acquisition program by providing at least $4.9 million through the Land 
and Water Conservation Fund. The U.S. Forest Service Scenic Area office 
has identified at least this amount of funding as necessary to meet 
land acquisition needs for fiscal year 1998, and Friends will be 
working with the Forest Service and landowners to provide a final list 
of priority lands and funding. The second priority is continuing the 
appropriations begun in fiscal year 1997 to provide payments to local 
governments.
    Both of these programs will protect the significant federal 
investment already made in the Gorge and continue building on the 
progress that Congress, through this Subcommittee, has made over the 
years to fulfill all dimensions of the Scenic Area Act, from economic 
development to environmental protection.
             background: unique resources, unique solutions
    As I believe the Subcommittee is aware, the Columbia Gorge is a 
national treasure that is like no other place in the country. 
Stretching 85 miles along the Columbia River, this deeply carved sea-
level channel through the Cascade range is home to a remarkable 
diversity of public resources. From the dry eastern Gorge to the dense 
conifer forests and surging creeks of the west, dazzling wildflower 
displays, including species found nowhere else on earth, cover 
hillsides and plateaus along the river. The corridor is rich in 
history--figuring prominently in the journals of Lewis and Clark and 
the Oregon Trail settlers--and in Indian prehistory, with ancient 
petroglyphs and village sites bearing witness to thousands of years of 
Indian life and commerce.
    Among the countless waterfalls that spill from high hanging valleys 
is Multnomah Falls, one of the tallest in the United States and the 
single most visited attraction in the entire National Forest system. 
Along with awe-inspiring geologic features that include towering 
monoliths, pillars, stone arches, these resources comprise a world-
class experience for those who live in the Gorge and the many thousands 
of visitors who come from across the country and around the world to 
enjoy the spectacular scenery, recreation, and natural and historical 
heritage.
    After completion of the Columbia Gorge Scenic Highway in 1916, 
state and county parks in Oregon and Washington were established to 
meet recreational demand, provide scenic vista points, and protect 
important natural features. A portion of the Gorge lands also fell 
under the jurisdiction of the Mt. Hood National Forest. But by far the 
majority of Gorge lands, including many of the most resource-rich areas 
and most prominent view sheds, remained unprotected or at best partly 
protected. Much privately held land was completely unzoned, raising an 
increasing threat of scatter-shot, unplanned development that would 
have irreparably destroyed the rural way of life and natural and 
cultural heritage of the Columbia Gorge. This sort of development, in 
such key scenic areas as the Multnomah Falls view shed and the Mt. 
Pleasant highlands at the western ``gates of the Gorge,'' was on the 
drawing boards in the late 1970's. In response, the Department of the 
Interior prepared a study, and Congress considered legislative 
proposals in the early 1980's to maintain the Gorge's special character 
while also supporting the capacity of towns in the Gorge to maintain 
economic development and appropriate growth.
    In 1986, the legislation creating the Columbia River Gorge National 
Scenic Area was enacted, establishing a new partnership approach for a 
complex area that is a mixture of urban, rural and wild lands with 
various federal, state, county and private ownerships. Under the Scenic 
Act, cities within the Scenic Area are targeted for economic 
development and growth, and are administered by city governments. Many 
of the most critical resource lands are included in ``Special 
Management Areas'' in which public land consolidation and stewardship 
are primarily the responsibility of the Forest Service. For other 
areas, county governments are relied on, through zoning and planning, 
to ensure that private land uses are consistent with the Gorge's rural, 
agricultural character and heritage.
    protecting the gorge through land acquisition--progress to date
    Friends greatly appreciates the Forest Service's demonstrated 
commitment, with the support of this Subcommittee, in securing the most 
critical recreational, natural and scenic lands on an as available 
basis through its land acquisition program. Land acquisition 
appropriations in previous years have allowed the Forest Service to 
make substantial progress in securing some of the Gorge's most special 
resources, from the rare plants and hiking trails of Burdoin Mountain 
and Rowena Dell to the pastoral Mt. Pleasant Highlands and the 
undisturbed Archer Mountain. These federal efforts have combined with 
private conservation work and state acquisitions (in such crucial areas 
as Beacon Rock State Park and the beautiful 6,000 acre Dalles Mountain 
Ranch in Washington) to move further toward comprehensive protection of 
the crown jewels of the Gorge.
    But a number of private properties remain in these areas of 
consolidation, including lands that could be developed among otherwise 
protected landscapes. Public and private investment in the conservation 
of these areas, and the good work to date toward comprehensive public 
management, will be jeopardized unless these parcels can be secured 
from willing sellers.
    Toward this end, Friends is developing a list of specific 
properties to be acquired, in conjunction with the landowners who have 
willingly offered these properties for sale, the U.S. Forest Service, 
and the Columbia River Gorge Commission. This coalition of landowners, 
land managers and land protection advocates all agree on the importance 
of this level of funding and of acquiring these parcels in a timely 
fashion. A preliminary list of properties has already been identified 
and outlined by the Forest Service which identifies $4.9 million in 
needed land acquisition funding. As soon as a final list is agreed to 
by all parties, we will transmit it to the Subcommittee as soon as 
possible.
    Some examples of key parcels which will almost certainly be on this 
list include the following:
    Catherine/Major Creek, WA.--For the past ten years, the Forest 
Service has acquired numerous fee interests to protect the scenic 
quality and natural heritage of this one-of-a-kind landscape in the 
eastern Gorge in Klickitat County, Washington. Along an approximately 
20-mile stretch of the Columbia River are rare oak grasslands and 
native wildflowers unique in the world. Several prominent properties 
here have been offered by landowners for public purchase.
    Cape Horn/Mt. Pleasant, WA.--The Forest Service has also acquired 
numerous fee and conservation easement interests to protect these 
spectacular pastoral and forested cliffs and fields, signature 
landscapes of the western Gorge and only a short 20-minute drive from 
Vancouver, Washington. Due to these lands' proximity to Clark County, 
Washington--one of the fastest growing counties in the country--these 
properties are at extremely high risk of sprawling development and 
timber harvest. Several prominent properties in this area have been 
offered by landowners for public purchase.
    These are examples of key properties that need to be acquired to 
realize the vision and protect the national investment in this special 
area. Failure to take advantage of these offers from landowners will 
result in inconsistent development that would frustrate the years of 
effort and investment.
               meeting commitments to county governments
    The second funding priority is to continue the effort begun in 
fiscal year 1997 to provide Gorge county governments with payments to 
compensate for lost tax revenue due to federal land acquisition. In 
1986, Congress recognized that private land would need to be purchased 
in order to protect the ecological and cultural resources of the Gorge. 
It also realized, through its experiences creating such legislation as 
the Payments in Lieu of Taxes Act of 1976, that putting private land 
into public ownership can put a strain on the operating budgets of 
county governments. When the Gorge Act was considered in 1986, however, 
the PILT program did not provide payments to counties for lands newly 
transferred into public ownership. Only lands in public ownership when 
PILT was originally passed actually received payments. Therefore, 
Congress included in the Gorge Act a provision for $2 million to be 
authorized for five years of PILT-type payments to Gorge counties for 
lands newly acquired, and taken off the tax rolls, by the Forest 
Service.
    Unfortunately, no money was appropriated for this program until 
fiscal year 1997--$250,000. Friends believes this commitment to the 
counties has gone unmet long enough and supports an appropriation of 
$215,000 in fiscal year 1998 for continuing this program, an amount 
identified by the Forest Service as necessary to meet its commitments 
under this authorization.
                  protecting the gorge--the next steps
    In the land acquisition category, the Catherine/Major Creek and 
Cape Horn/Mt. Pleasant properties are among a number of available lands 
in the Columbia Gorge for which we are told the Forest Service will be 
requesting at least $4.9 million. This request is clearly a recognition 
of the national importance of this program. We believe that at least 
$4.9 million is needed this year to help complete the vision that has 
come so far in the past 10 years. We hope the Subcommittee will be able 
to provide this amount.
    In addition, we hope the Subcommittee will provide the small amount 
identified by the Forest Service for the payments to counties 
authorized under the Act. These payments will assist these governments 
with providing services to Gorge residents, as well as the area's 
rapidly growing number of visitors, most of whom come to experience the 
magnificent vistas, waterfalls, wildflowers and recreational 
opportunities of the National Scenic Area.
    We appreciate all of the support you have given this program in the 
past. With the funding we are requesting, we believe the Forest Service 
can make significant progress toward realizing the goals of the 
National Scenic Area Act, and protecting the heritage of the Columbia 
Gorge.
    Thank you very much for your consideration of this testimony.
                                 ______
                                 

 Prepared Statement of James Earl Kennamer, Ph.D., Vice President for 
         Conservation Programs, National Wild Turkey Federation

    The National Wild Turkey Federation [NWTF] urges the United States 
Senate to increase funding of the U.S. Forest Service Challenge Cost 
Share Program, hire additional wildlife biologists for our National 
Forests and increase funding of wildlife management programs thus 
allowing the private sector to increase our commitment of resources on 
our National Forests.
    The NWTF is an international nonprofit conservation organization 
centered in the United States. Our 132,000 members are dedicated to the 
conservation of the wild turkey and the preservation of the turkey 
hunting tradition. Our 800 volunteer chapters work closely with state 
and Federal conservation agencies to manage the wildlife resources on 
public and private lands. The NWTF cooperates with the U.S. Forest 
Service to cost share projects on National Forests through the ``Making 
Tracks'' program.
    While the NWTF supports the Federal government's commitment to 
ecosystem management and wildlife conservation on the National Forests, 
we are particularly concerned with the continued reduction in the level 
of funding for wildlife management programs and projects. This 
reduction in funding has seriously impeded the management of both game 
and nongame species on many National Forests. Similarly, the reduction 
in the number of trained and experienced wildlife biologists on many 
forests has reduced the level of expertise to the point that there are 
simply not enough qualified people to do the job. This reduction in 
force has occurred at a time when the wildlife related workload (legal 
appeals, threatened and endangered species concerns, wetland issues and 
ecosystem management planning) have increased dramatically. This 
increase in wildlife related work will continue in the foreseeable 
future.
    At a recent meeting with the U.S. Forest Service in Washington, DC, 
the gravity of the situation became apparent.
    The USFS Wildlife Habitat Management budget has decreased 7 percent 
since 1993 and is 23 percent below the 1993 agency request.
    Currently 15 forests of 119 reporting do not have forest level 
wildlife biologists.
    All forest-level wildlife and fisheries staff officers have been 
eliminated from the Southwestern Region.
    Technicians, rather than biologists, now do most of the wildlife 
work in the Southeast.
    Less Challenge Cost Share funds are reaching the ground at a time 
when more money is available from the private sector.
    Since 1986, The USFS, the NWTF and the state wildlife agencies have 
completed over 542 projects for a total expenditure of $3.75 million on 
the National Forests. The NWTF has contributed $1.24 million or 
approximately 33 percent of these funds. The down-sizing of the Federal 
Government was supposed to increase the number of partnerships. The 
opposite is true since less dollars and manpower are available to 
develop projects and cultivate partnerships.
    The National Forests produce some of the pulp and much of the saw 
timber that this country needs. The forests also protect water quality 
and while these uses are important they are overshadowed by the value 
of the forests for wildlife habitat and as recreational areas. In a 
1993 USFS study of the economic impact of the National Forests on Gross 
Domestic Product, approximately $105 billion or 85 percent was 
attributable to recreation including hunting, fishing and wildlife 
viewing.
    The National Forests can and should provide timber and wildlife 
benefits to the nation. These two uses are interdependent, not mutually 
exclusive. However, the reduction of the wildlife budget is so great 
that the USFS can no longer be expected to do ``more with less''. They 
can only do ``less with less'' and our National Forests and their 
valuable timber and wildlife resources are beginning to show the 
strain.
    The NWTF applauds the effort this administration and the Congress 
have made to reduce the national debt. However, the wildlife resource 
and the recreational users are being adversely impacted 
disproportionate to their value to the nation. Partners such as the 
NWTF are willing and able to help fund projects through the Challenge 
Cost Share Program, but the USFS needs the matching funds and the 
trained professionals on the forest to help us spend our volunteer's 
funds wisely.
    The NWTF urges Congress to increase funding of the Challenge Cost 
Share Program, hire additional wildlife biologists and increase funding 
of wildlife management programs thus allowing the private sector to 
increase our commitments on our National Forests.
    Thank you for this opportunity to comment on this most important 
issue.
                                 ______
                                 

 Prepared Statement of Lonnie L. Williamson, Vice President, Wildlife 
                          Management Institute

    Mr. Chairman: I am Lonnie L. Williamson, vice-president of the 
Wildlife Management Institute. Established in 1911, the Institute is 
staffed by professional wildlife scientists and managers. Its purpose 
is to promote the restoration and improved management of wildlife in 
North America.
                          u.s. forest service
    Wildlife habitat.--WMI recommends that the U.S. Forest Service 
wildlife account, referred to in the agency as the ``Get Wild 
Program.'' be increased in fiscal year 1998 to $40 million, which would 
be $10 million more than requested by the administration. And, we 
recommend that $8 million be earmarked for the Challenge Cost-Share 
Program.
    The Service's Wildlife Habitat program was drawn in fiscal year 
1994 and has been in the process of being quartered ever since. The 
President's request of $28.3 million for fiscal year 1998 is 27 percent 
below the fiscal year 1993 appropriation of $38.9 minion. For an 
already seriously underfunded effort, this is a particularly savage 
blow. Wildlife is suffering from inattention as the number of wildlife 
biologists eases down and those that remain are reassigned non-wildlife 
duties. On the Ouachita National Forest, for example, there is only 
$128,000 in wildlife funds to cover 1.75 minion acres. Ouachita's 
wildlife program is surviving only with the use of KV funds, which may 
or may not be available in any given year. If this inequity is not 
corrected, wildlife uses will have to be curtailed, causing significant 
social and economic distress. Under this scenario, we now can make the 
same mistakes in all Forest Service regions as were ineptly 
accomplished in the Pacific Northwest, which is now costing a fortune 
to correct.
    Indicative of the Forest Service's lost ability to take proper care 
of the public's wildlife is the Challenge Cost-Share Program, which 
matches non-federal contributions to implement wildlife habitat 
improvement projects on national forests. Forest Service partners 
participating in the program consistently provide more than their share 
to this effort because the agency does not have funds to match those 
donated. In fiscal year 1993, the Service had but $4.5 million to match 
$6.6 million provided by partners. In fiscal year 1994, it was $6.2 
million for the Service and $7.4 for the partners. In fiscal year 1995, 
it was $5.6 million to $7.4 million. Last year, the partners began 
diverting funds from the national forests because of the lack of 
matching by the Service. In the Pacific Northwest, more than $200,000 
were retrieved from the table by partners because the Service had no 
matching money.
    Inland fisheries.--WMI supports the administration's request of 
$17.157 million for inland fisheries on national forests. We further 
suggest that $3.4 million be earmarked for Challenge Cost-Share 
projects.
    Anadromous fisheries.--WMI supports the Administration's request of 
$22.521 million for anadromous fisheries. And, we recommend that $3.1 
million be earmarked for Challenge Cost-Share projects.
    Threatened and endangered species.--WMI supports the 
administration's request of $27.218 million for T&E species. That is $5 
million more than fiscal year 1997. This is about one third of what the 
Forest Service says that it needs for T&E species. And that is no 
mystery, considering the scant attention given to the vast majority of 
national forest species which are not endangered. By not making the 
investments in the Wildlife Habitat account, we assure a continued 
march of species into the T&S category, where huge amounts of money are 
needed to protect and/or extricate them. WMI also recommends that $5.1 
million of T&F funds be earmarked for Challenge Cost-Share projects.
    Rangeland management.--WMI supports the administration's request 
for an additional $7.4 million to improve range conditions. Despite 
progress, 23.5 million acres of the 99 million acres of grazed national 
forest remain in unsatisfactory condition. This program has been sorely 
underfunded for years. Its budget could be doubled without taking care 
of all the needs.
    Seeking common ground.--WMI recommends that $300.000 of the Forest 
Service's budget be earmarked for Seeking Common Ground ($150,000 from 
wildlife and fish and $150,000 from range management). SCG is the most 
successful range restoration program to date. It is directed and funded 
by the Forest Service, Bureau of Land Management, National Fish and 
Wildlife Foundation, American Farm Bureau Federation, Rocky Mountain 
Elk Foundation, and Wildlife Management Institute. It features local 
groups solving local problems at the local level in the national 
interest. We encourage the committee to become familiar with this 
effort. A speech that I gave on the beginnings of SCG is attached for 
the committee's information.
    Forest stewardship and stewardship incentive.--WMI supports the 
President's request of $23.380 million and $10.230 million respectively 
for the Forest Stewardship and Stewardship Incentive programs. Forest 
Stewardship fosters constructive interdisciplinary partnerships between 
state foresters and state wildlife agencies. For example, this program 
shares the costs with state wildlife agencies of hiring professional 
wildlife managers to work closely with foresters in writing multiple 
purpose forest management plans. This cooperative effort helps ensure 
that nonindustrial private forests are managed to meet resource 
objectives of landowners who want to integrate wildlife habitat with 
forest product production. Stewardship Incentive provides cost-share 
funds to help NIPF landowners implement forest plans produced under the 
Forest Stewardship program.
    Forest and rangeland research.--WMI recommends that Forest and 
Rangeland Research be increased $2 milling to $181.781 million, so that 
the Service may have about the same amount (in inflated dollars) as in 
fiscal year 1997.
    Ecosystem planning, inventory, and monitoring.--WMI recommends that 
the increases recommended above may be offset by taking money from the 
EPIM account. Ground-level resource management activities, including 
fish, wildlife and range have suffered in great part because funds were 
taken from those efforts to finance this account, which is not 
justified in the budget. We have not been informed on how the EPIM 
money is being spent, nor have we seen the benefits of that 
expenditure. We can but conclude that on-the-ground management 
activities are more important to the National Forest System and its 
customers.
                       bureau of land management
    Wildlife, fisheries and T&E species.--WMI is most disappointed with 
the administration's request for $44.573 million to fund fisheries, 
wildlife and T&E species on BLM's 270 million acres. The wildlife 
account is essentially the same as in fiscal year 1997 and remains 
about 10 percent below the fiscal year 1991 level. BLM reported 
recently that its lands and waters now harbor more than 300 species 
either listed as T&E or proposed for listing. T&E species on BLM land 
has been increasing about 20 species annually during the past several 
years. And that is no wonder, considering the meager wildlife 
management resources available.
    By denying wildlife a seat at the table when land management 
decisions are made on livestock grazing, timbering, mining and the 
like, we are perpetuating a very efficient model that creates 
endangered species. WMI recommends that this budget item be increased 
by $7 million above the administration's request, up to $51.573 
million. We recommend that the wildlife account be increased to $24 
million, which better reflects the funding called for in BLM's Fish and 
Wildlife 2000 document. We also support a $1 million increase in the 
fisheries account to get it nearer the Fish and Wildlife 2000 level. 
And, we recommend that the T&E account be upped by $2 million for the 
same reason. As with the Forest Service, we note that adequate 
investments must be made in the nonendangered species to keep them out 
of the T&E category and from disrupting multiple uses of the land.
    Rangeland management.--WMI supports the administration's request 
for $54.342 million to finance the rangeland management program. 
However, we recommend that $150,000 be added for the purpose stated 
below.
    Seeking common ground.--WMI recommends that $150,000 of our 
proposed add-on to Wildlife, Fisheries and T&E Species, and the 
$150,000 proposed add-on to Rangeland Management, be earmarked for 
Seeking Common Ground.
                     u.s. fish and wildlife service
    Endangered species.--WMI supports the administration's request of 
$11.4 million. We further recommend that the Cooperative Endangered 
Species Conservation Fund be budgeted at the $14.1 million dollar level 
enacted in fiscal year 1997. Endangered and threatened species 
conservation, management, and recovery activities were impaired by 
Congressional action in the last Congress, and the backlog of proposed 
listings and recovery actions must be erased. We are disappointed that 
the administration proposes to reduce the Section 6 funds available to 
the states for T&E conservation projects to $14 million from the fiscal 
year 1997 level of $14.1 million. The management action necessary to 
conserve T&E species, and to conserve candidate species prior to 
listing, is best taken by the various states.
    Habitat conservation.--WMI supports the Administration's request of 
$57 million for Habitat Conservation. The Partners for Wildlife Program 
is extremely popular with private landowners, and by providing cost-
sharing, gives landowners the incentives and the capability to 
implement conservation practices on private lands, often reducing or 
eliminating important causes of wetland and other habitat degradation. 
Similarly, the Project Planning activity saves millions of dollars in 
habitat restoration needs by assuring that planned projects are 
designed from the outset to minimize adverse environmental 
consequences.
    Refuge operation and maintenance.--WMI recommends an appropriation 
of $220 million for Refuge Operation and Maintenance. The maintenance 
needs of National Wildlife Refuges have been consistently neglected to 
the point of jeopardizing the ability of some refuges to accomplish 
their mission. There is currently a maintenance backlog of $428 million 
on National Wildlife Refuges. We recommend the administration's budget 
request of $192 million be increased to $220 million, with the 
additional $28 million earmarked for reduction of maintenance backlogs.
    Congress requested information regarding the use of animal traps on 
National Wildlife Refuges in the fiscal year 1997 Appropriations 
Conference Report. Some question the use of certain types of traps. 
However, there are no other suitable trapping devices to use as yet, 
even though USDA-APHIS-ADC and a coalition in Vegreville, Alberta, 
Canada continue research for alternatives. The U.S. Fish and Wildlife 
Service has not contributed to either of these research efforts. Given 
the significant role trapping plays in the management of National 
Wildlife Refuges, we recommend $200,000 be added to the Fish and 
Wildlife Service budget and earmarked for methods development research 
at USDA's National Wildlife Research Center at Fort Collins.
    Migratory bird management.--WMT supports the administration's 
request of $17.1 million. Monitoring migratory bird populations, both 
nongame and game species, is necessary to detect population declines 
and address them before species become rare and may require listing as 
T&E species. Increased funding for the North American Waterfowl 
Management Plan not only benefits waterfowl, but leverages federal 
dollars through partnerships with states, organizations, and 
individuals, and also provides habitat conservation and restoration 
benefits to a whole suite of other wetland birds and amphibians.
    Wildlife conservation and appreciation fund.--WMI supports a $1 
million appropriation for the Wildlife Conservation and Appreciation 
Fund. This fund leverages federal expenditures by serving as a match 
for external contributions, and provides the states badly-needed money 
to manage species which are neither harvested nor listed as threatened, 
endangered, or candidate species. In most states, there is little or no 
other funding source for managing such species.
    North American wetlands conservation fund.--WMI recommends 
appropriation of the full amount authorized by Congress of $30 million. 
This highly successful program returns $2 of nonfederal funds for each 
$1 of federal funds, and has attracted more than 600 paying partners. 
The program consistently receives more proposed partner cost-sharing 
each year than can be covered by the full $30 million. Millions of 
dollars of nonfederal funds are being lost each year.
    National Fish and Wildlife Foundation.--WMI supports a fiscal year 
1998 budget of $7.5 million for the Foundation. The National Fish and 
Wildlife Foundation has raised more than $2 non-federal for every 
federal dollar expended. Over 11 years, more than 1,800 grants have 
advanced management of wildlife, fish and their habitats. Increased 
appropriation will assist the government in doing more for wildlife 
with less federal money.
                u.s.g.s.--biological resources division
    The Wildlife Management Institute supports the administration's 
proposed budget of $145 million for the Biological Resources Division 
of the U.S. Geological Survey. The Biological Resources Division (BRD) 
of the United States Geological Survey comprises nearly the entire 
biological research capacity of the Department of the Interior (DOI). 
Prior to the formation of the National Biological Survey, scientists 
and programs of BRD were located in the land management agencies of DOI 
(U.S. Fish and Wildlife Service, Bureau of Land Management, National 
Park Service). Removal of scientists and programs from the land 
managers critically impairs the communication of research needs from 
managers to scientists and the communication of research results from 
scientists to managers. The result is that the scientific information 
needs of land managers are less well met. The important work of BRD 
includes research in support of federal land management, research on 
endocrine disrupters in the environment, research on restoration of 
degraded lands, research on restoration of Great Lakes fisheries, 
development of scientific information management technology and making 
scientific data accessible to users, and the Cooperative Fish and 
Wildlife Research Units.
    The Cooperative Research Units are particularly important. State 
fish and wildlife agencies depend on the Cooperative Research Units to 
deliver scientific information needed for effective fish and wildlife 
management. The Units also train the next generation of fish and 
wildlife scientists, and are an efficient use of federal dollars since 
those dollars are leveraged by contributions of the state fish and 
wildlife agencies and universities. There are currently 22.5 vacant 
positions of Unit Leader and Assistant Leader. A high priority of BRD 
should be to fill those vacant positions over the next few years. We 
support that priority emphasis, and support the administration's 
requested increase of $1 million earmarked to reduce the number of 
vacant positions at the Cooperative Fish and Wildlife Research Units.
                                 ______
                                 
        Letter From Jean Hocker, President, Land Trust Alliance
                                    Washington, DC, April 14, 1997.
Hon. Slade Gorton,
Chairman, Subcommittee on Interior and Related Agencies,
Committee on Appropriations, U.S. Senate, Washington, DC.
    Dear Chairman Gorton: On behalf of the Board of Directors and 
members of the Land Trust Alliance (LTA), I am sending this letter to 
be included in the record of testimony on the fiscal year 1998 
appropriation to the Department of the Interior.
    The Land Trust Alliance serves more than 1,200 land trusts across 
the country. These are independent grassroots organizations dedicated 
to protecting land and the quality of life in their communities through 
private, voluntary action. Working within a cooperative, incentive-
based strategy, these groups have helped save more than 4 million acres 
of wetlands and wildlife habitat, productive farm and forest lands, and 
other significant resources.
    Land trusts have worked with several programs under the committee's 
jurisdiction to conserve land valuable to communities across the 
country, usually leveraging the private funding that is the key to the 
success of these programs. They have formed partnerships with local 
landowners and the Partners for Wildlife program to protect valuable 
privately-owned habitat. They have helped preserve valuable working 
timberland by arranging easements under the Forest Legacy program. They 
have helped make possible land conservation plans that have used 
acquisition funding under the federal Land and Water Conservation Fund 
(LWCF) appropriation. They have worked with state and local governments 
to target state-side LWCF funding to the best purposes.
    Though clearly effective, these programs are suffering from chronic 
underfunding. The LWCF appropriation has fallen to a level far too low 
to meet even the most urgent federal land acquisition priorities. State 
LWCF funding, so important to community conservation efforts, has been 
eliminated. Partners for Wildlife, an extremely responsible and cost-
effective program of public-private partnerships was also recently 
threatened with elimination. Forest Legacy, an innovative program that 
has suffered from unnecessary administrative delays, is now funded at a 
level so low as to barely make it a viable national program.
                federal land and water conservation fund
    The lack of funding from the Land and Water Conservation Fund is 
bad public policy since the government collects these funds under a law 
that intends them to be used for conservation purposes. The diverting 
of the vast majority of these funds to other purposes, while perhaps 
understandable given fiscal constraints, is nevertheless at odds with 
the intent of the law establishing the fund, and it all but creates a 
situation in which the government is collecting fees under a false 
pretext. The appropriation committee can begin to return the use of 
LWCF to its original purpose by appropriating a larger percentage of 
LWCF funds for the purposes for which they are collected. An increase 
in this appropriation will encourage land trusts to carry out more 
important land conservation projects as they have in the past.
    For example, a $10.5 million LWCF appropriation made possible the 
acquisition of 1,227 acres of land bordering the Golden Gate National 
Recreation Area in San Mate, California. Because of the appropriation, 
the Peninsula Open Space Trust was able to leverage $10.5 million in 
private contributions to purchase the tract which was subsequently 
transferred to the National Park Service for the enjoyment of all 
Americans.
    In addition, a $1.4 million LWCF appropriation enabled the 
Wilderness Land Trust to purchase and protect a 1,320 acre inholding in 
the James Peak Roadless Area. Situated near Rocky Mountain National 
Park in Colorado, this U.S. Forest Service high-priority acquisition 
could not have occurred without the trust's involvement. Because of the 
appropriation and the trust's excellent and on going relationship with 
the landowner, the largest private inholding in the James Peak Roadless 
Area is now in public ownership and the area may finally achieve long-
sought wilderness designation.
    President Clinton's fiscal year 1998 request for $167 million from 
the LWCF is inadequate. LTA recommends that the committee provide 
funding at a level more consistent with the demonstrated need. A more 
appropriate level would be almost triple the President's request, to 
$450 million, which would be only slightly more than half of the level 
Congress appropriated twenty years ago: in fiscal year 1978, Congress 
appropriated $805 million from the LWCF, $314.1 million of which was 
directed to state matching grants.
              state-side land and water conservation fund
    Congress also needs to fulfill its legal responsibilities under the 
LWCF to provide matching grants to states. State LWCF grants leverage 
at least an amount equal to federal conservation funding, and therefore 
have a positive impact far in excess of the amount appropriated. State-
side LWCF funding has suffered a dramatic reduction over the past five 
years: at this point, the program is all but shut down. There is no 
fiscal year 1997 money for state grants, nor does the Administration 
propose any for fiscal year 1998. It is unfortunate that a program that 
has historically been very successful in promoting community and 
nonprofit involvement in conservation activities should suffer from 
such neglect.
    Grants to states from LWCF spawned a fruitful partnership between 
the State of New Hampshire and the state's largest land trust, the 
Society for the Protection of New Hampshire Forests. The Society has 
been successful in acquiring several properties that the state has 
deemed as desirable for park land. The Society's nongovernmental status 
has allowed it to move quickly and decisively to protect land for state 
parks--land that might have otherwise been developed. The Society then 
transfers the land to the state after the state has received its state 
LWCF funding. Without these grants, the people of New Hampshire's would 
not have as many state parks to enjoy, and their right to have adequate 
outdoor recreational opportunities would be compromised.
                         forest legacy program
    The Forest Legacy program is another example of a highly leveraged 
program that gets a tremendous value for each federal dollar 
appropriated to it. It provides partial funding of conservation 
easements on working timberland. This program has in the past been 
plagued by administrative delays, but the 1996 farm bill amended the 
program to allow for direct state grants in the hope that this would 
help to streamline the process and make Forest Legacy more efficient. 
Even before this new administrative provision, land trusts formed 
successful partnerships with the U.S. Forest Service through the Forest 
Legacy program to protect thousands of acres of forestland threatened 
with conversion.
    For example, the Rangeley Lakes Heritage Trust worked with the 
Forest Legacy program to protect 1,272 acres of pristine Maine 
forestland. As a result of the Forest Service's decision to supply 
$840,000 for the acquisition of a conservation easement on the 
property, the trust was able to raise over $400,000 to cover the 
remaining amount needed to purchase and protect the tract. The result 
was the protection of 3.4 miles of lakefront that represented a 
critical link in 12 miles of continuous undeveloped lakeshore. It also 
contributed to more than 40 miles of protected shorefront in the 
Rangeley Lakes chain which encompasses over 33,000 acres of public 
access conservation lands.
    In a wooded area on the outskirts of Boston, the purchase of a 
permanent 73-acre conservation easement by the Forest Service helped to 
facilitate the protection of nearly 1,200 acres in the historic 
Estabrook Woods of Concord and Carlisle. A favorite haunt of Henry 
David Thoreau, the Woods have come under increasing development 
pressure. The Forest Service's willingness to purchase the easement 
served as the catalyst that allowed several area land trusts to 
complete negotiations on the protection of the adjoining woodlands.
    LTA recommends an increase of funding for the program because of 
the need to protect timberland and because of the growing number of 
states qualified to participate in it. An appropriation at least three 
times the President's request of $4.006 million--and substantially 
increased over last year's level of $2 million--is required to allow 
the program to function as an effective, national program to protect 
private working timberland.
                         partners for wildlife
    With some reluctance, LTA supports the President's fiscal year 1998 
level funding requests for Partners for Wildlife of $22.513 million, 
although it is inadequate to meet the need in these areas, as 
acceptable given current budgetary constraints.
    Thank you for considering the views of the Land Trust Alliance on 
behalf of the 1,200 private citizen conservation organizations that 
make up the nation's burgeoning land trust movement as you make your 
funding decisions for the coming fiscal year.
            Sincerely,
                                               Jean Hocker,
                                                         President.
                                 ______
                                 
  Letter From Daniel P. Beard, Senior Vice President for Policy, the 
                        National Audubon Society
                                    Washington, DC, March 31, 1997.
Senator Slade Gorton,
Chairman, Subcommittee on Interior Appropriations,
U.S. Senate, Washington, DC.
    Dear Senator Gorton: On behalf of the National Audubon Society's 
more than half a million members and our 515 chapters in communities 
throughout the United States, I am writing to you regarding the 
Department of Interior and Related Agencies appropriations bill for 
fiscal year 1998. National Audubon is dedicated to the protection of 
birds, wildlife, and their habitat for the benefit of all Americans and 
for future generations. Proper stewardship of our public lands and 
wildlife requires adequate levels of funding. To that end, we have 
identified below a number of priorities that support our goal of strong 
stewardship of our national lands and wildlife. We would appreciate it 
if your office would include this letter in the public record.
                    preservation of migratory birds
    In the United States more than 60 million people identify 
themselves as birdwatchers, contributing more than $20 billion annually 
to the U.S. economy. Yet year after year the U.S. government fails to 
sufficiently fund programs that protect nongame birds, despite the fact 
that it makes good economic sense. In conjunction with Partners in 
Flight, Audubon recently published the WatchList; it includes 90 bird 
species, primarily nongame, that are in decline. Funding for the 
conservation of these birds today will halt their decline and preclude 
the need for expensive emergency measures later to prevent their 
extinction. In recognition of the economic and environmental importance 
of this natural resource, we urge you to fully fund the following 
programs.
    The Office of Migratory Bird Management (MBMO) provides scientific 
information and management advice on migratory birds to federal land 
managers. We believe that the President's budget request of $17.11 
million for this key program is inadequate to meet current needs. The 
budget request includes $600,000 to monitor and implement conservation 
measures for the 120 Species of Management Concern identified last 
year. This initiative, which is designed to prevent future listings of 
migratory birds under the Endangered Species Act, needs an additional 
$600,000 to fully implement the program. We also support increasing 
MBMO's budget by $500,000 to allow the FWS's seven regional offices to 
hire one additional nongame bird coordinator. These offices currently 
lack sufficient staff to advise federal land managers and implement 
nongame programs. We also request additional funding to support the 
MBMO's ongoing effort to develop national guidelines for the issuance 
of permits to take migratory birds, and to create a database for 
tracking the cumulative regional and national take of individual 
species. These activities will improve FWS's customer service and 
response time to individual permit requests.
    We also support the activities of the U.S. Fish & Wildlife Service 
International Programs (International Conservation line-item), and in 
particular the Western Hemisphere Program, which trains protected area 
managers in Latin America and makes small matching grants for education 
and grassroots conservation. This is one of the few U.S. programs that 
benefits North America. Audubon urges Congress to support an increase 
of $1 million for funding this important program.
    We also support game and nongame bird habitat acquisition programs 
such as the North American Wetlands Conservation Fund ($15 million), 
the Land and Water Conservation Fund (see below), and the Partners for 
Wildlife Program ($22.5 million).
    Audubon urges Congress to recognize the economic importance of 
nongame bird species, and to fully fund programs that benefit these 
species.
                    land and water conservation fund
    Recent reductions in appropriations for the Land and Water 
Conservation Fund will have a long-lasting negative impact on America's 
natural resources. LWCF funding protects wilderness, wetlands, beaches, 
and other open spaces for the protection of wildlife and the enjoyment 
of future generations. In many cases, direct fee acquisition from 
willing private sellers, facilitated by use of the LWCF, is the best 
way to accomplish long-term protection of priority lands. The 
Administration's $166.6 million request will not meet current needs and 
should be significantly increased.
    The LWCF state program provides funding for the conservation 
priorities of individual states. This matching grant program allows 
states to complete conservation projects at the local level and the 
matching requirement ensures that states and communities are fully 
committed to these projects. Eliminating the acquisition funding for 
state side projects in fiscal year 1996 interrupted ongoing state 
projects by removing a vital source of funds. We urge this Subcommittee 
to fund acquisition grants to states in fiscal year 1998, meeting at 
least fiscal year 1995 spending levels of $30 million. We have 
submitted our acquisition priority list separately.
                               everglades
    As Everglades National Park approaches its 50th birthday, it also 
nears a crossroads that will determine much of the fate of its next 
fifty years. The National Audubon Society urges the Subcommittee to 
seize this opportunity and fully fund the Administration's Everglades 
Watershed Restoration budget request.
    The President has requested $139.5 million for the Department of 
the Interior's fiscal year 1998 Everglades Watershed Restoration 
programs. NAS strongly supports the proposed budget, particularly the 
$100 million requested as an initial deposit into the Everglades 
Restoration Fund (ERF).
    The ERF would provide $76 million for land acquisition, $12 million 
for research, and $12 million for modified water deliveries. It would 
be funded by royalties from oil and gas leasing on the Outer 
Continental Shelf. The use revenues generated from non-renewable 
resources to fund the protection of natural resources is long-standing 
policy, and we urge the Subcommittee to use this funding source to 
fully appropriate the ERF.
    We reiterate our appreciation to the 104th Congress for the 
discretionary funding included in the Freedom to Farm Act. While we are 
concerned with the slow expenditure of these funds, we are very 
optimistic that most, if not all, of the remaining balance will be 
allocated by October 1, 1997. Therefore, we caution the Subcommittee to 
separate the funds included in the Farm Bill from its decisions with 
respect to the fiscal year 1998 Interior appropriations bill.
                   biological resources division/usgs
    National Audubon urges Congress to pass a sustainable level of 
funding for the Biological Resources Division of the United States 
Geological Service (BRD). BRD provides sound, unbiased scientific 
information to federal agencies, state and local governments, private 
industry, and the public, which in turn use this information to make 
informed natural resource and land management decisions. To ensure the 
future of these vital programs, the President's request of $145 million 
should be increased to fiscal year 1994 levels ($166 million). We urge 
Congress to include an earmark of $300,000 for research on the impacts 
of commercial fishing on seabirds in the Pacific.
    BRD programs include 60 science centers, such as the National 
Wildlife Health Center in Madison, Wisconsin, which responds to 
outbreaks of wildlife diseases including rabies and avian cholera, and 
the Patuxent Research Center in Maryland, which monitors the health of 
the Chesapeake Bay ecosystem and the wildlife that depend upon it. BRD 
monitors waterfowl population and fisheries research programs which 
collect vital data that is used by states and the USFWS to set fishing 
catch limits and hunting bag limits, and to determine the length of 
hunting seasons. BRD is the only federal bureau that is dedicated both 
to collecting biological scientific data and to sharing that 
information with FWS regional and field offices and the States. BRD 
scientists conduct nearly one hundred percent of federal research on 
nongame birds and a significant amount of research on game birds. We 
urge you to fund BRD at $166 million so that vital, unbiased, 
scientific information continues to guide the decisions of federal and 
state natural resource managers.
                       bureau of land management
    We support full funding of Secretary Babbitt's proposal to 
reintroduce wildland fire to our forest ecosystems. Wildland fire is a 
natural and necessary component of forest ecosystems. Occasional fires 
burn excessive undergrowth, and are also necessary for many fire-
dependent species.
                             forest service
    We oppose funding for construction of more logging roads, whether 
by direct appropriation or through the device of ``purchaser credits.'' 
Road building is one of the most environmentally destructive of all 
Forest Service activities. The Administration's proposal to discontinue 
timber purchaser credits and to alter the cost of road-building to a 
direct cost is a step in the right direction, but does not fully 
address the issue: taxpayers would still be forced to subsidize 
additional and unnecessary road-building. Audubon supports funding for 
road obliteration and for maintenance of existing roads to reduce 
stream sedimentation and prevent mud slides.
    Audubon supports a funding level of $121 million for the Forest 
Service Wildlife and Fisheries Habitat Management Program. This program 
supports restoration and improvement of important habitats, including 
old-growth, riparian, and watershed habitats.
    We oppose the Administration's proposed Forest Ecosystem 
Restoration and Maintenance Fund (FERM) as it is currently written. 
Although we support the intention to supply more funding for 
restoration, we feel the activities and funding mechanisms permitted 
under FERM are open to abuse.
                    national wildlife refuge system
    Although the National Wildlife Refuge System represents a vitally 
important investment by the American public in our nation's precious 
wildlife resources, the operating budget for the Refuge System 
represents a tiny fraction of federal spending. Approaching its 100th 
anniversary in 2003, the refuge system includes more than 92 million 
acres and over 500 refuges, offering habitat for a quarter of the 
country's threatened and endangered species, and providing vital rest 
stops, breeding grounds, and staging areas for migratory birds. In 
addition, the Refuge System offers tremendous opportunities for public 
outdoor education, wildlife viewing, hiking, hunting, and fishing and 
other compatible recreational activities. Inadequate operations and 
maintenance funds have degraded refuge habitat; consequently, refuges 
are less productive for wildlife and associated recreational 
opportunities.
    As part of its Wildlife Refuge Campaign, Audubon has recently 
launched the Audubon Refuge Keepers program (ARK) that establishes 
volunteer support groups for individual refuges. These groups provide 
support for wildlife refuges through volunteerism and educational 
outreach. Although Audubon volunteers and others can help refuges meet 
a variety of unfulfilled needs, we cannot expect volunteers on refuges 
to supplant federal O&M funding.
    In 1993, Interior's Inspector General issued a report that 
documented a $323 million backlog in maintenance projects. This figure 
has grown to $428 million, jeopardizing the integrity of the entire 
Refuge System. The President's budget proposes $192 million for refuge 
operations and maintenance, including new activities such as public 
awareness campaigns and the development of comprehensive management 
plans. As a member of the Cooperative Alliance for Refuge Enhancement 
(CARE), National Audubon supports the objective of incrementally 
increasing O&M funds for the Refuge System over the next six years (as 
outlined in Dr. Rollin Sparrowe's CARE testimony). While the CARE 
proposal will not meet desired funding levels, it will go a long way 
toward meeting the bird and wildlife conservation objectives that we 
support for the System. For fiscal year 1998, we support a funding 
level of $220 million for Refuge Operations and Maintenance.
                         endangered species act
    The Endangered Species Act was intended to prevent the decline of 
our nation's biological resources and to recover those species 
threatened with extinction. We urge you to pass adequate funding levels 
for these programs to ensure the uninterrupted operation of vital 
species recovery programs.
    The Fish and Wildlife Service is under a court order to list a 
number of candidate species by the end of this year. The $5.16 million 
requested for listing activities is barely adequate to address this 
backlog, which will cost an estimated $5 million, leaving little for 
dealing with new petitions or other listing needs. We urge you to 
increase funding for listing of species. We also support increased 
funding for the Cooperative Endangered Species Conservation Fund to 
assist states with their species conservation priorities.
    The President's request includes increased funding for the rapidly-
expanding Habitat Conservation Plan program (HCP). In 1992, the federal 
government had approved fewer than one dozen HCPs; as of November 1996, 
they had approved 197, with another 200 in development. The federal 
government has obligations to monitor and enforce these plans, and to 
respond in the event that unforeseen circumstances require modification 
of plans. The nominal increase requested by the President is inadequate 
to fulfill these obligations.
                 national fish and wildlife foundation
    The National Audubon Society supports the Administration's request 
of $7.5 million for the National Fish and Wildlife Foundation. This 
increase of $2.5 million will allow the Foundation to address the 
growing need for partnerships to solve difficult conservation issues. 
The Foundation leverages its federal appropriations through the use of 
challenge grants. An increase in appropriations will fund the 
implementation of the Partners in Flight North American Bird 
conservation strategy.
    Thank you for your consideration of our priorities for funding for 
the Department of the Interior. With your strong leadership of this 
Subcommittee we believe that our nation's resources will be fully 
protected.
            Sincerely,
                                           Daniel P. Beard,
                                  Senior Vice President for Policy.
    Attachment.
                                 ______
                                 

     National Audubon Society LWCF Priorities for Fiscal Year 1998

                            federal projects
Fish and Wildlife Service
    Archie Carr NWR, FL; Balcones Canyonlands NWR, TX; Bayou Savage 
NWR, LA; Black River NWR, WA; Canaan Valley NWR, WV; Chincoteague NWR, 
VA; Ding Darling NWR, FL; Don Edwards San Francisco Bay NWR; Edwin B. 
Forsythe NWR, NJ; Grasslands Wildlife Management Area, CA; Great Swamp 
NWR, NJ; Hakalau Forest NWR, HI; John Heinz NWR, PA; Klamath Forest 
NWR, OR; Lake Wales Ridge NWR, FL; Lake Woodruff NWR, FL; Long Island 
Complex, NY; Lower Rio Grande NWR, TX; Montezuma NWR, NY; Nisqually 
NWR, WA; Oregon Coastal Refuges NWR, OR; Ottawa NWR, OH; Patoka River 
NWR, IN; Pelican Island NWR, FL; Red Rock Lakes NWR, MT; Sacramento 
River NWR, CA; San Joaquin River NWR, CA; Silvio O. Conte NWR, CT; 
Stewart B. McKinney NWR, CT; Stillwater NWR, NV; Tualatin River NWR, 
OR; Upper Mississippi NWR, MN; San Diego NWR, CA; Waccamaw NWR, SC; 
Wallkill NWR, NY.
U.S. Forest Service
    Columbia River Gorge National Scenic Area, WA; Gifford Pinchot NF, 
White Salmon/Klickitat National WSR, OR; Green Mountain NF, Glastenbury 
Tract, VT; Olympic NF, Rayonier Old-Growth Tract, WA; San Bernadino NF, 
CA; Siskiyou NF, Kalmiopsis Wilderness, OR--Silver Creek, Lloyd 
Property, Brown Mining Claim, Alleman property.
National Park Service
    Everglades National Park, FL; Jean Lafitte National Historical Park 
and Preserve, La; Sterling Forest.
State-side acquisitions
    Adirondack National Park--Whitney Property; Arlecho Creek, WA; 
Highlands National Forest Preserve, NJ; Rodman Ranch and Slough, CA; 
Tug Hill, NY.
                                 ______
                                 

   Prepared Statement of R. Max Peterson, Executive Vice President, 
        International Association of Fish and Wildlife Agencies

    The International Association of Fish and Wildlife Agencies was 
founded in 1902 as a quasi-govemmental organization of public agencies 
charged with the protection and management of North America's fish and 
wildlife resources. The Association's governmental members include the 
fish and wildlife agencies of the states, provinces, and federal 
governments of the U.S., Canada, and Mexico. All 50 states are members. 
The Association has been a key organization in promoting sound resource 
management and strengthening federal, state, and private cooperation in 
protecting and managing fish and wildlife and their habitats in the 
public interest.
                     u.s. fish and wildlife service
    The Association generally supports the Administration's fiscal year 
1998 budget request for the U.S. Fish and Wildlife Service. The funds 
requested demonstrate a strong commitment to the nation's fish and 
wildlife resources. Presented below are the specific Association 
recommendations for the fiscal year 1997 USFWS budget.
    General Comments.--We recognize that because of the need for defect 
reduction, Congress will take steps to reduce appropriations for some 
agencies. Programs will be controlled, reduced or eliminated. A serious 
test for any program will be whether or not it fits the basic mission 
of the Service and provides substantial public benefits. The 
Association believes the programs that offer the following 
characteristics are consistent with the basic mission of the Service 
and afford the highest benefit to fish and wildlife resources and the 
cooperating state agencies: (1) establish true state/federal 
partnerships; (2) offer significant leverage of non-federal funds 
through cooperative programs; (3) support efforts to prevent species 
and their habitats from becoming threatened or endangered; (4) provide 
fish and wildlife associated outdoor recreation opportunities including 
hunting and fishing which serve a large number of people each year; (5) 
provide important economic and environmental benefits to large segments 
of the American people; (6) reinvest and enhance existing public land 
holdings/refuges; (7) empower states to best determine priority 
management action ad the state level; and (8) provide adequate 
flexibility for local program adjustment.
    We encourage Congress to measure programs against these criteria 
and to ensure that programs which measure up are funded.
    Wallop-Breaux and Pittman-Robertson.--The Association urges 
Congress to continue to protect the integrity of the Wallop-Breaux and 
Pittman-Robertson user pay/user benefit programs from diversion from 
their intended purpose. Public support of user fee programs will 
continue if the funds provided are used only for the purposes for which 
they were established. The Association strongly supports the 
reauthorization of the authority (which expires at the end of fiscal 
year 1997) to dedicate the motorboat fuel taxes from the ARTF to the 
Boat Safety Account, which funds Boating Safety Grants to the States. 
The Association also strongly supports reauthorization of the authority 
(which expires at the end of fiscal year 1997) to transfer receipts 
collected on small engine fuels from the Highway Trust Fund to the 
Aquatic Resources Trust Fund. Finally, the Association strongly 
supports reauthorization of the Clean Vessel Act (which expires at the 
end of fiscal year 1997) to continue to dedicate up to $10 million from 
the SFRA to boat pumpout programs and $10 million to boating safety. 
The Association is disappointed that the Administration is not 
supporting reauthorization of this program, which is contributing 
significantly to address the problems of overboard sewage contamination 
of inland waters.
    Based on the success of these model user-benefit/user-pay programs, 
the Association has been shepherding an effort similar to Pittman-
Robertson and Wallop-Breaux to expand user fees on other outdoor 
recreation products. Under the Teaming With Wildlife proposal funds 
would thus be provided for a broader fish and wildlife conservation, 
recreation, and outdoor education programs in the States. This is a 
user-benefit/user-pay, incentive based program that is now supported by 
more than 1,700 organizations including both traditional fish and 
wildlife organizations and a wide array of bird watchers, 
photographers, hikers, etc.
    Through the cooperative partnerships between the state fish and 
wildlife agencies and the private sector created by these programs, we 
can begin to develop preventive, comprehensive, and broad scale 
management to ensure the vitality of fish, wildlife and plant species 
and their habitats. Taking prudent actions to prevent endangerment 
simply makes good ecological and economic sense.
    These efforts will also provide expanded outdoor recreation and 
educational opportunities for Americans to enjoy wildlife in natural 
settings and to increase their knowledge of fish and wildlife and their 
life needs and habited requirements. Public demands for these 
activities continue to increase and are unmet under existing programs.
    North American Wetlands Conservation Act Activities.--The 
Association recommends that the North American Wetlands Conservation 
Act be funded at the full authorization level of $20 million. This 
cooperative program that requires at least a 1:1 non-federal match is a 
highly successful, non-regulatory, incentive based program that has 
shown substantial results in restoring waterfowl and other migratory 
bird populations. While the $15 million requested in the budget is very 
encouraging it remains well below the authorized level of $20 million. 
The tremendous success of this program in generating in excess of a 2:1 
match from non-federal sources plus the acreage secured or enhanced 
warrants its full appropriation.
    The Association is pleased to recognize the Administration's 
continuing commitment to the implementation of the North American 
Waterfowl Management Plan, including support for the 11 United States, 
3 Canadian, and 1 International Joint Ventures. The Association 
continues to recognize the need for additional funds to enable the Fish 
and Wildlife Service to provide adequate assistance for the Joint 
Ventures. Joint Ventures are the ``engine'' of plan implementation, and 
these partnerships need to be supported.
    The Association continues to recommend that Congress appropriate an 
additional $5 million to collect data and monitor 16 priority goose and 
brant populations across North America as part of the Arctic Goose 
Joint Venture. Currently there are no operational breeding population 
surveys or pre-harvest banding programs on populations of Arctic geese. 
This information is needed for management of these migratory, 
international resources.
    The Association believes that evaluation of on-the-ground wetland 
habitat enhancement activities under the North American Plan, Farm Bill 
and other programs is extremely important to be sure which activities 
are most effective and to guide long-term efforts. We recommend that a 
minimum of $80,000 per year be allocated for a 10-year period to 
conduct essential evaluation work.
    Endangered Species.--The Association was disappointed that the 
Administration's request for Cooperative Endangered Species grants to 
the States was not higher than $7.5 million, resulting in a reduction 
of $85,000 from the fiscal year 1997 enacted. The Association requests 
a $3 million increase in the budget dealing with the state grants under 
the Cooperative Endangered Species Conservation Fund. While the 
Association recognizes the merits of and supports the additional 
requested $6 million in the fund for land acquisition under HCPs, the 
Association recommends that the increase for assistance in this fund be 
made available to the states through the cooperative agreement process 
with the individual states deciding the best mix of inflammation, 
incentives and acquisitions to achieve habitat conservation and 
recovery objectives, and not dust for fee title acquisition.
    The Association supports the $6.1 million increase in consultation 
and this increase should be available to the states for direct support 
of state nongame/wildlife diversity program data services which are 
used in designing conservation plans.
    Wildlife Nongame Grants to States.--The Association strongly 
advocates Congressional support through appropriation of the full 
authorized funding level for both the 1980 Fish and Wildlife 
Conservation (Nongame) Act (authored at $5 million) and the 1992 
Partnerships for Wildlife Act (titled the Wildlife Conservation and 
Appreciation Fund authorized at $6.25 million). This remains a high 
funding priority for state fish and wildlife agencies in fiscal year 
1998; the Association has supported federal-state nongame funding for 
many years. Without a prevention strategy for these species, we will 
continue to see species move into the threatened or endangered species 
category with all the expenses and disruption that entails.
    The Association is disappointed that the Administration's request 
of $800,000 for the Partnership for Wildlife Act is only level with the 
fiscal year 1997 enacted. Because increases in federal funds are 
matched equally by both state and private monies, this is a very 
effective program. We expect these cooperative proposals to increase 
dramatically in the years ahead. The Association recommends an 
additional $1.2 million be appropriated for this program.
    Migratory Bird Management.--Association commends the Service for 
the $1.5 million increase but remains concerned that the base budget 
for the management of migratory birds is still below an adequate level. 
Inflation and increased operating costs have escalated and any enhanced 
funding in recent years has been earmarked. Additional funding is 
needed to facilitate meeting program objectives for migratory bird 
conservation. The Association recommends an additional increase of $1 
million to address this need.
    In audition, the Association supports the Service's commitment to 
Adaptive Resources Management but stresses that strengthening data 
bases is necessary. Adaptive Resource Management offers excellent 
potential for strengthening federal/state relations.
    The Association is supportive of efforts to amend the U.S./Canada 
Migratory Bird Convention. We are pleased that an agreement has been 
reached and amendments successfully completed. Since part of the 
agreement focuses on the need for proper monitoring, the Association 
feels strongly that funds must be available to properly monitor 
subsistence harvest in Alaska.
    Nongame migratory bird populations need additional monitoring to 
assure that management of declining species precludes having to rely on 
the Endangered Species Act. Monitoring would target marshbirds and 
other bird groups in order to develop the same quality data available 
for waterfowl. The Association supports the request for an additional 
$1.5 million for this effort. Many of these efforts are conduced in 
partnership with state fish and wildlife agencies, particularly through 
the Partners in Flight program for the conservation of songbirds and 
raptors that migrate between our temperate forests and grasslands to 
the tropical regions in Lain America. This is a class example of acting 
now to conserve many of these declining species thereby preventing them 
from becoming endangered. This is a cost efficient way to conduct our 
conservation efforts.
    Since the early 1980's, there has been little effort devoted to 
correcting data deficiencies related to the management of webless 
migratory game birds. There is a demonstrated need for better 
population and harvest survey information for species such as woodcock, 
mourning doves, sandhill cranes and rails. The Association wishes to 
stress the importance of webless migratory game bird management as an 
integral part of the Services' programs and responsibilities, and as 
this program evolves, necessary budgets must increase as well.
    Management for migratory game birds needs additional funding to 
fully implement the Harvest Information Program, which will add 28 
states in 1998; and Adaptive Harvest Management, which was initiated in 
1996 to enhance monitoring capabilities in support of waterfowl and 
migratory webless gamebirds. These funds would enhance management 
capabilities to balance competing objectives of population growth and 
responsible recreational uses. The Association requests $1.5 million 
for these programs.
    Refuses and Wildlife.--The Association recognizes and supports high 
priority land acquisition for Wildlife Refuges for the purpose of 
protecting nationally important wetlands, and fish and wildlife habitat 
(including threatened and endangered species) for public use and 
enjoyment. However, in years of continued budget shortfall and 
underfunding of the operation and maintenance activities of existing 
Refuges, we question the wisdom of continued land acquisition of new 
Refuges without providing adequate funding for existing refuge 
operation and maintenance. The Association strongly supports the $13.8 
million increase requested for the operation and maintenance of the 
National Wildlife Refuse System.
    The Association continues its long history of support for an 
increase in the funding requested for operation and maintenance of the 
National Wildlife Refuge System. Upkeep activities addressing the 
critical needs of the refuge system are vitally important. High 
priority should be given to maintaining refuge maintenance and 
operations at a level that adequately protects wildlife resources and 
provides for wildlife dependent recreational uses. The Association also 
encourages Congress to consider the appropriate chances in legislation 
to permit funding of operation and maintenance requirements from the 
Land and Water Conservation Fund. The Association supports the pilot 
changes in the collection and disbursement of recreation/entrance fees 
charged on refuses. All of the fees collected would be available for 
refuge operations and maintenance on the Refuges where they are 
collected.
    The Association recommends full funding for the Refuse Revenue 
Sharing Fund; the fiscal year 1998 budget request is only an estimated 
62 percent of the full funding level. These funds are used to offset 
the loss of tax revenues to state and local governments. Full funding 
will ease financial burdens to counties containing refuges, thus 
fulfilling the governments obligations pursuant to the Refuse Revenue 
Sharing Act.
    In the fiscal year 1997 Appropriations Conference Report, Congress 
requested information regarding the use of annual traps on National 
Wildlife Refuges. While some question the use of certain types of 
traps, no widely applicable alternative trapping devices are available, 
in spite of pioneering research being conducted by USDA-APHIS-ADC at 
their Fort Collins Research Center, and by a coalition of interests in 
Vegreville, Alberta, Canada. The U.S. Fish and Wildlife Service has not 
contributed to either of these research efforts. Given the significant 
role trapping plays in the management of the National Wildlife Refuge 
system, the Association recommends that $100,000 be added to the 
Services' budget for a portion of the methods developments research at 
USDA's National Wildlife Research Center at Fort Collins.
    Private Lands Program.--The Association recognizes that 
partnerships with private landowners are essential in advancing fish 
and wildlife conservation and supports the $266,000 increase in the 
Partners for Wildlife targeted to specific areas of primary federal 
concern such as migratory birds, wetlands, and threatened and 
endangered species. The Association also urges these funds to be an 
additional increase, and not to redirect funds from an already 
established source within the base budget. The Association urges the 
Fish and Wildlife Service to cooperate with and be responsive to the 
needs identified by state fish and wildlife agencies In implementing 
these programs. In the past the Association has voiced concerns about 
adequate coordination of the Partners for Wildlife Program with ongoing 
efforts of the states to provide assistance to private landowners. The 
Association believes that planned expenditures in the Partners for 
Wildlife program involving private land should be targeted for 
enhancement of habitat such as wetlands that primarily benefits 
migratory birds. There are many opportunities for wetland enhancement 
projects that would benefit waterfowl and other migratory birds.
    Fisheries.--The Association is pleased to see the Administration's 
budget reflect an increasing dedication to the Fish and Wildlife 
Service's fisheries programs, particularly, an increase in the fish and 
wildlife management line item within the fisheries division budget. 
Additionally, the Association applauds the recognition by the Service 
of the need for financial support for whirling disease research under 
the Biological Resources Division of the USGS and work in partnership 
with the Great Lake states and the Canadian government to conduct 
genetic and other research on lake trout and sturgeon stocks and to 
mitigate the impact of nonindigenous species. In the Service's fiscal 
year 1997 budget request, these proposals were included within a 
broader initiative which also addressed the needs of coastal fisheries 
on the Atlantic and Gulf of Mexico coasts. The IAFWA recognizes that, 
though not in the President's fiscal year 1998 request, the needs of 
Atlantic and Gulf anadromous and riverine fisheries management will 
continue to exist through the next fiscal year, as well as the 
Service's authority and responsibility to meet those needs. Working in 
partnership with the states and interstate fish commissions, the IAFWA 
recommends an additional $2 million for research, management and 
enforcement of anadromous coastal fisheries programs by the Fish and 
Wildlife Service.
    Other Fish and Wildlife Service Budget Items.--Recognizing the 
essential and important research and field work that the Service has 
conducted concerning contaminants through the Natural Resource Damage 
Assessment Program, the Association supports the increase of $628,000 
for fiscal year 1998. Because of the reliance by States and tribes on 
information from this program, this increase will improve the Service 
program and those of its partner States and tribes. Given that the 
program is the backbone for all federal damage assessment programs 
within USDI, however, the Association strongly supports an additional 
$1.4 million in funding for this program.
    The Washington State Ecosystem Project, which is entering its 
seventh year, is designed to evaluate innovative approaches to reverse 
the decline in farmland wildlife, wetlands and riparian areas in the 
state of Washington. It shows promise of substantial benefits to a wide 
variety of fish and wildlife by providing habitat diversity on private 
lands. The Association supports the continuation of this project at 
$1.483 million for fiscal year 1998 and recommends that $500,000 be 
appropriated to continue the South Carolina Coastal Ecosystem 
Initiative. The Association also strongly supports a $1.7 million 
increase to the Fish and Wildlife Service to implement the South 
Florida Ecosystem Restoration Initiative.
    The Northwest Forest Plan is a comprehensive approach to managing 
forests in the Pacific Northwest. The U.S. Fish and Wildlife Service 
participates with other federal and state agencies in carrying out this 
program. The Service's responsibilities under this plan focus on 
endangered species and habitat restoration concerns. It is essential 
that the Service continue to be funded to be able to participate as a 
full partner in this integrated program. The Association supports the 
request for an increase of $1.6 million to meet its responsibilities 
under the Northwest Forest Plan.
    The Association supports the Administration's request of $5 million 
to support the National Fish and Wildlife Foundation. In the last 11 
years the Foundation has funded nearly 1,800 fish, wildlife and plant 
conservation projects many of which have been done in cooperation with 
state natural resources agencies. These projects have leveraged over 2 
non-federal dolled for every federal donor appropriated. Further, the 
Foundation utilizes no federal money to fund its administration.
    The Association supports FWS' continued production of the 
``Wildlife Review'' and ``Fishers Review'' publications vital to 
research and management of natural resources.
    The Association appreciates the increased request of $750,000 for 
hydropower licensing and mitigation studies. This reflects the huge 
burden placed on the Service by the many FERC relicensing studies 
required as a large number of licenses expire and must be relicensed. 
The Association strongly urges Congress to provide this additional 
funding to allow the Service to adequately review and propose 
hydropower licensing/relicensing requirements. Adequate information is 
essential before long-term licenses are granted.
    The Association recommends that the Bears Bluff Field Station be 
rehabilitated as Bears Bluff Fisheries Coordination Office to serve as 
a National focus point for Service operations in the restoration and 
recovery of the endangered shortnose sturgeon and the protected 
Atlantic sturgeon. The unique culture expertise and ability to produce 
sturgeon can be used to complement state and management group interest 
in restoration and protection of depleted sturgeon resources. The 
Association recommends the addition of $1 million for site 
rehabilitation and construction and $1 million for collaborative 
culture and fisheries studies with state partners of North Carolina, 
South Carolina, Georgia, and Florida.
    Border 21.--At the February 1997 Mexico, Canada, and United States 
Trilateral Commission meeting, 15 high priority Border XXI projects 
were targeted for implementation. Geographically, these projects are 
widely distributed along the entire United States/Mexico Border and all 
13 projects have been identified by individual United States-Mexico 
states as being border-wide issues. At this time, there is no funding 
identified in the U.S. budget for projects. The Association recommends 
that $1 million be appropriated to initiate high priority international 
projects in 1998. This increase should be made in the General Activity 
Portion of the Service budget under ``Border 21.''
    NAFTA Projects (Borderlands).--Over the past three years, 
collaboration between the U.S. Fish and Wildlife Service (FWS) and 
Mexico's Director General for Wildlife (DGW) has achieved important 
objectives in the conservation and management of Mexico and United 
States wildlife and protected areas. The NAFTA initiative continues to 
support habitat for many species shared by the United States and 
Mexico. These are species whose habitats would continue to decline in 
number and habitat quality without this support. NAFTA funds have in 
the past been leveraged at a 1:4 ratio with an apportionment of 
$702,260 resulting in the development of over $3 million in non-U.S. 
match.
    The Association recommends that NAFTA initiative funding levels be 
increased to $850,000 which, combined with existing funds, covers only 
50 percent of the amount requested by project proposals. This increase 
should be made in the General Activity portion of the Service budget 
under ``International Conservation.''
                    bureau of land management [blm]
    The BLM budget with minor exception is a continuation of last years 
efforts. Reductions in staff have resulted in increased demands and 
fewer reports on accomplishments. Consolidation of accountable budget 
categories from 48 to 19 has made it increasingly difficult for state 
fish and wildlife partners to obtain adequate information on specific 
programs. The Association is concerned about these changes, and 
particularly concerned that funding for such programs as BLMs riparian 
initiative and Challenge Cost Share moneys may suffer in the 
competition for funds if such moneys are not dedicated at the activity 
level. The Association continues to believe that it is important that 
BLM track and report annual performance objectives and accomplishments 
on these critically important sub-activities in their budget.
    The BLM has made special efforts to communicate its management 
objectives through such documents as Fish and Wildlife 2000 and 
national habitat management plans. These plans establish measurable 
objectives for fish and wildlife programs on public lands managed by 
BLM. While progress has been made in the 1998 budget to improve habitat 
and aquatic performance indicators and to list natural resource 
opportunity projects by state, the current budget structure is still so 
broad it fails to tie these objectives directly to the budget process. 
The Association continues to believe that it is essential that BLM 
clearly relate its management goals to a specific, usable budget 
structure and site specific measurable performance objectives.
    Land Resources.--The emphasis on Rangeland Restoration efforts 
throughout the west is essential to bring these lands back to their 
full productive capacity, and the Association is pleased to note the 
emphasis on this program. Similarly, the Association strongly supports 
BLM's commitment to increase cooperative efforts between the United 
States and Mexico under the North American Free Trade Act of 1994. 
Additionally, the management of Wild Horses and Burros has been an 
ongoing concern of the Association, and prior budgets have, in our 
opinion, been inadequate to allow BLM to successfully implement its 
Strategic Plan for Management of Wad Horses and Burros, which calls for 
achieving proper management levels of these species by 1998. The 
Association is therefore pleased with and commends BLM for its fiscal 
year 1998 budget request, and fully supports the recommended increase 
of $2.8 million in this budget to control the growth of the wild horse 
and burro populations that compete with native wildlife population and 
can cause serious range deterioration.
    Wildlife and Fisheries.--The Association commends BLM on continuing 
to identify the Wildlife and Fisheries Program as a budget activity 
separate from Threatened and Endangered Species. The Association 
recommends an increase of $500,000 to implement fisheries management 
and BLM's share of the Recreational Fisheries Initiative because we 
feel the proposed 1998 budget request of $500,000 is inadequate to 
address current demand. Public demand is strong for continuing 
fisheries habitat improvement on the public lands through such high 
priority partnership agreements as the Lake Havasu project, in 
conjunction with the Bureau of Reclamation, the states of California 
and Arizona, and private groups including Anglers United. This type of 
effort benefits a large segment of the public, and provides maximum 
return on federal expenditures. Additionally, the BLM is working 
closely with state fish and wildlife agencies on both Partners in 
Flight (terrestrial nongame birds) and watchable wildlife efforts. We 
urge continuation of these important conservation programs that address 
species and habitat needs before significant declines require further 
efforts. We continue to be very concerned with riparian habitats and 
support the intensive riparian inventory progress of 76 percent made to 
this point. However the progress made to directly improve identified 
degraded riparian habitats is woefully inadequate. The Association 
recommends an increase of $1 million to begin to adequately address the 
significant backlog of riparian habitat recovery opportunities.
    Threatened and Endangered Species.--Management of a number of 
candidate and federally listed fish populations in the Columbia and 
Snake River Basins of Oregon, Washington, and Idaho continues to be 
critical to avoid further declines and potential listing of some 
species, and to reduce or mitigate impacts to others. These efforts 
fall largely under the agreements resulting from the Pacific Northwest 
Salmon Summit of 1992. BLM efforts to improve resource conditions in 
this region and to implement interagency agreements is strongly 
supported. The Association supports the fiscal year 1998 identified 
species priorities including Desert Tortoise in Arizona, bull trout in 
Idaho and Montana and swift fox and mountain plover in Montana and the 
fiscal year 1997 effort made towards California Condor reintroductions 
but does recommend an additional $400,000 to fully implement the BLM 
portion of the Desert Tortoise Recovery Plan in cooperation with Clark 
County, Nevada and the Nevada Habitat Conservation Plan.
    Recreation Management.--The Association commends BLM proposals to 
coordinate Interior agency management of public lands protected under 
the California Desert Protection Act.
    Finally the Association strongly supports the BLM's participation 
in such interagency efforts as the Eastside Ecosystem Management 
Project in the Columbia River Basin. Interagency efforts to identify 
resource concerns and management options at that level should provide 
significant benefits to decisionmakers as they strive for balance 
between competing land uses. The Association strongly endorses BLM 
participation in these interagency efforts, and firmly believes that 
efforts such as these will result in improved understanding of 
alternatives facing decisionmakers concerning the wise stewardship of 
public lands. More specifically, the Association supports funding for 
the Seeking Common Ground (SCG) effort of the BLM at a level of 
$250,000. This nationally sponsored partnership includes the 
Association, the BLM, USFS, NFWF, the American Farm Bureau, the 
National Rife Association, Rocky Mountain Elk Foundation and the 
Wildlife Management Institute. SCG partners goals include the support 
for demonstration projects that: Improve rangeland conditions; promote 
individual stewardship that improves resources; improve communications 
between rangeland users; reduce conflict between livestock and 
wildlife; and encourage problem solving at the local level.
                       u.s. forest service [usfs]
    The Association urges Congress provide a balanced budget for the 
Forest Service, reflecting the full range of needs as identified in the 
forest plans. The public benefits economically and environmentally as a 
result of equal consideration for all National Forest resources. In 
1995, wildlife and fish related recreation on national forests resulted 
in $3.68 billion of net public benefit. That equals a $37.27 return on 
each dollar invested in fish and wildlife.
    National Forest System.--Funding for fish and wildlife habitats on 
National Forests has languished for more than three years. Considering 
the increasing amount of private matching funds made available to this 
program since 1986, the President's budget for fiscal year 1998 is very 
disappointing. The Association supports additional investments in 
wildlife and range programs that will result in significant economic 
and social benefits.
    Get Wild Program.--This program focuses on terrestrial and semi-
aquatic wildlife and serves as an umbrella for 10 national wildlife 
emphasis areas. In the President's fiscal year 1998 budget, funding for 
this program is increased only $1.637 million from fiscal year 1997 
enacted. Thus, the program would remain more than $9 million below the 
fiscal year 1995 level. It is estimated by the Forest Service that full 
implementation of these opportunities wound cost $54.447 million in 
fiscal year 1998. This is a true habitat protection and restoration 
program that maintains wildlife populations and improves rangelands by 
providing the proper mix of several multiple uses on federal lands. The 
Forest Service's effort is to ensure the sustainability of terrestrial 
species and the habitats on which they depend. The Association supports 
this program and recommends that Congress provide a funding level 
consistent with fiscal year 1995 at $38 million.
    Challenge Cost-Share Program.--The Fish and Wildlife Challenge 
Cost-Share Program, a cooperative partnership effort, is funded at 
$17.2 million for fiscal year 1998, which is nearly $4 minion less than 
the Service's cooperators contributed in fiscal year 1997. This is a 
very successful program, with non-federal fish and wildlife 
organizations providing considerably more than the Service for habitat 
improvement projects on national forests. The Association strongly 
supports increasing the Service's share of this program to the fiscal 
year 1997 cooperators' level of $21 million.
    Threatened and Endangered Species Programs.--The Association urges 
Congress to continue supporting this program by approving the 
President's request of $27.218 million for fiscal year 1998. Assuring 
compliance with the Endangered Species Act creates significant impact 
on the states. Consequently, funding should be provided to help support 
state Endangered Species Act consultation with the Forest Service. The 
Association urges that current funding be used to help support state 
fish and wildlife agency efforts so that more of the national priority 
needs can be met.
    Inland Fisheries.--The Association supports funding this program at 
least at the fiscal year 1998 level recommended by the President of 
$17.157 million. These funds would provide for habitat initiatives that 
protect and restore inland fish habitat that will enhance the 
productivity of National Forest System aquatic resources.
    The Association recommends that the anadromous fisheries program be 
funded in fiscal year 1998 at the requested level of $22.521 million.
    Rangeland Management.--This continues to be one of the most 
underfunded of Forest Service programs. Therefore, we strongly support 
the proposed increase of $7.376 million and urge that the increase be 
used to complete NEPA analyses, where they are needed, compliance 
monitoring, and the completion of improvements that alleviate riparian 
and other rangeland Grazing problems.
    Forest Research.--Scientific studies provide information and 
technology needed to protect, manage, use, and sustain the natural 
resources of this nation. The Association urges Congress to fund forest 
research at the proposed fiscal year 1998 level of $179.7 mullion. 
Funding at this level will continue to provide natural resource 
decision makers with a wide variety of information to make natural 
resource use and management decisions.
    The Association agrees that there is a need to provide an 
appropriate level of funding for the Forest Service Ecosystem 
Management Program. However, during past fiscal years, millions of 
dollars have been transferred from the Wildlife and Fisheries and Range 
programs into Ecosystem Management. It is not at all clear how these 
funds will be used for the planning, monitoring and survey work 
required for viable fish, wildlife and range programs. In the past, 
these activities were funded directly from the individual budgets which 
were readily identifiable. In Ecosystem Management, the goals and 
objectives are not identified. The Association cannot support such a 
vague approach to planning and monitoring. We recommend that the 
Ecosystem Management division be directed to: (1) identify its goals 
and objectives; (2) determine its needs and institute an evaluation 
system; and (3) inform cooperators on how the funds will be spent and 
on what programs. Unless this is done, support will continue to erode.
    State and Private Forestry.--The Association continues to be 
strongly supportive of programs that assist private landowners and 
states to improve and enhance fisheries and wildlife habitat, protect 
watershed values and contribute to the economic and environmental well 
being of urban and rural America. Therefore, we support proposed 
funding levels for Forest Stewardship, Stewardship Incentives, Urban 
Forestry, Forest Legacy, and Cooperative Lands Fire Management. We also 
remain supportive of Forest Health programs, but suggest that Forest 
Health programs should include a wider array of components, such as 
forest health from a fish and wildlife perspective and ensure forest 
health protection for state and private lands.
    Seeking Common Ground.--The Association supports funding the 
Seeking Common Ground effort in the Forest Service at $250.000. This 
nationally sponsored partnership includes the Association, the Forest 
Service, Bureau of Land Management, National Fish and Wildlife 
Foundation, American Farm Bureau Federation, National Rifle 
Association, Rocky Mountain Elk Foundation, and Wildlife Management 
Institute. SCG goals include support for demonstration projects that: 
improve rangeland condition; promote individual stewardship that 
improves public and private resources; improve communications among 
rangeland users; reduce conflict between livestock and wildlife; 
encourage problem-solving at the local level.
                     bureau of indian affairs [bia]
    The Association continues to be concerned by the wholly inadequate 
wildlife and parks budget of the Bureau of Indian Affairs. We are, 
however, pleased that the wildlife and parks base request of $28.105 
million for fiscal year 1998 demonstrates a positive move away from the 
traditional process of requiring that the tribes request individual 
Congressional add-one to meet on-going year-to-year wildlife and parks 
base budget needs. The Association strongly supports the base request 
in fiscal year 1998 of $26.105 million.
    The fiscal year 1998 budget includes $372,000 for fish hatchery 
maintenance, an amount which barely recognizes the $14 to 15 million 
backlog in required hatchery maintenance. The Association strongly 
recommends an increased funding level for fiscal year 1998 and out 
years with the objective of eliminating the fish hatchery maintenance 
backlog by fiscal year 1999
    The Association has in the past strongly supported the 
Administration's request for fish hatchery rehabilitation to 
rehabilitate tribal fish hatcheries and replace capitalized equipment 
for the highest priority projects. While the Administration has not 
requested any money in fiscal year 1998, the Association strongly 
recommends that Congress appropriate continued level (to fiscal year 
1995) funding (approx. $1.5 million) for this effort in fiscal year 
1998 to replace failing systems and modernize tribal fish hatcheries to 
enable them to optimize fish production. This funding would help 
satisfy vital tribal fishery needs.
    The Association believes that tribal lands are integral to the 
maintenance and recovery of threatened and endangered species. 
Presently, the majority of tribes are unable to be parties to candidate 
species studies and conservation agreements due principally to lack of 
funding. The Association strongly supports an increase of $400,000 to 
the central operations line item for the tribes to participate in all 
phases of the endangered species recovery process. This would enable 
tribes to begin to address listed species needs and recovery of species 
that all Americans benefit from.
    While the Association is opposed to diversion of federal aid funds, 
it is committed to adequate federal funding to provide for professional 
management of tribal fish and wildlife resources. The Association 
believes that Native American tribes have identified legitimate funding 
needs for fish and wildlife on millions of acres of tribal lands and 
that adequate funding will preserve and enhance the cultural heritage 
of Native American Tribes while providing positive economic benefits, 
and ensuring the conservation of significant fish and wildlife 
resources.
                  biological resources division, usgs
    The Association supports the stated goals for the BRD, but we are 
concerned that inadequate progress has been made to refine the mission 
to provide the applied research necessary to complement existing state 
programs and emphasize partnerships. The Association wishes to 
reemphasize the importance of developing a partnership between BRD and 
state fish and wildlife agencies. A meaningful, co-equal partnership 
with the state fish and wildlife agencies is essential if the BRD is to 
achieve its goal of facilitating natural resources conservation based 
on sound applied science. The proposed fiscal year 1998 budget 
principally reflects an emphasis on meeting the needs identified by 
Department of Interior land management bureaus, units of the federal 
government that manage only 20 percent of the land area of the United 
States. Biological research needs for the 80 percent of the land area 
of the United States managed by states are largely ignored.
    The proposed budget includes $6.5 million for new initiatives while 
proposing reductions in areas of critical concern to states, in 
particular research on warm water fisheries, wetlands, and waterfowl. 
In addition, no increases are proposed within the following BRD program 
categories: Migratory Game Birds, Wildlife Disease, Chemical and Drug 
Registration, Partnership for Public Aquaculture, and Research on 
Endangered Species. While we support the increase to exotic invasive 
species, noxious weed management, salmon habitat research, and Great 
Lakes fisheries, the Association recommends that the BRD be directed to 
consult with state fish and wildlife agencies to insure adequate 
attention is directed to these other research needs and that no 
reductions in funding or the quality of service be permitted.
    Cooperative Research Units.--The Association strongly supports the 
Coop Units. The Coop Units continue to be one of the best examples of 
cooperative research for wildlife and fisheries in our nation. This is 
at the heart of goals of providing scientific data that is essential 
for land management decisions. The proposed budget includes a $1 
million increase for the Cooperative Fish and Wildlife Research Unit 
program. While we applaud this increase, it represents restoration of 
only half of the reductions from the previous 2 fiscal years. The 
Association recommends that sufficient funding intended for new 
initiatives be reprogrammed to the Coop Unit program to fill all 21 
currently vacant positions and provide adequate support for these 
positions. The Association supports the creation of new Cooperative 
Research Units with the understanding that existing units will be fully 
staffed and funded. We recommend that these Units be cart of the 
fisheries and wildlife programs and that they work with State fish and 
wildlife agencies to carry out applied research on fisheries and 
wildlife issues.
    The BRD bird banding laboratory and migratory bird research office 
at Patuxent is critical to the multi-government and non-government 
Partners in Flight effort. The Association recommends continuing 
support.
    One area where state-BRD cooperation is critical is in the 
registration of fishery therapeutants. The BRD has received $500,000 
for this work and needs to make every effort to use these funds in 
cooperation with state contributions. This effort will take at least 
five years and will require the support of state and private interests 
to support BRD research.
    The Association is disappointed that cooperation with the State 
fish and wildlife agencies in identifying critical research needs to 
solve on the ground resource problems continues to be minimal. We have 
reminded BRD that over 80 percent of the Programs now within BRD were 
originally in the U.S. Fish and Wildlife Service. The Association 
recommends that BRD be directed to work with state fish and wildlife 
agendas to identify and address issues impacting fish and wildlife. The 
Association further recommends that state fish and wildlife agency 
personnel be included in developing the research program of BRD, 
including serving as members of the Science Board of BRD. Otherwise, 
the BRD research program will almost surely not serve the applied 
research needs of fish and wildlife agencies.
                      national park service [nps]
    The Association is encouraged by the proposed $65.714 million 
increase in Operations of the National Park System but is disappointed 
that no funds are requested for state grants for the Land and Water 
Conservation Fund in fiscal year 1998. We strongly encourage Congress 
to restore at least fiscal year 1995 level funding at $30 million for 
this important partnership effort. The federal-state cooperative effort 
to provide outdoor recreation opportunities though the Land and Water 
Conservation Fund is seriously undermined when only the federal portion 
is funded.
    The Association supports full implementation of and the progress 
being made in concessions reform providing those funds Reduced remain 
available to the National Park Service. Likewise, we support continued 
revision of fee polices to allow establishment of service fees on the 
basis of facility usage and operational requirements. As with 
concessions reform, monies generated by fee restructuring should 
continue to be available to the National Park Service for specific on-
the-around activities.
    The Association recognizes the importance of the South Florida 
ecosystem and supports funding for restoration efforts in the 
Everglades National Park, the Big Cypress National Preserve, and the 
South Florida Restoration program. We support the proposal to fund the 
NPS share of the Everglades Watershed Restoration project ($100 
million) as supportive of fish and wildlife and other resource 
interests. We recognize it may not be feasible to fully fund this 
initiative.
    The Association generally supports the proposed National Park 
Service Land Acquisition budget ($69.9 million), but recognize that 
budget reduction may prevent this level of funding.
    The Association supports proposed funding of natural resource 
initiatives (approximately $9 million) including air, water quality, 
habitat, and plant and wildlife distribution assessments provided the 
National Park Service closely coordinate these programs with state 
resource management agencies.
                                 ______
                                 

Prepared Statement of Ken Poynter, Executive Director, Native American 
                        Fish & Wildlife Society

    Mr. Chairman and Distinguished Committee Members: My name is Ken 
Poynter, current Executive Director of the Native American Fish & 
Wildlife Society (Society) and an enrolled member of the Passamaquoddy 
Tribe of Maine. I would like to thank you, on behalf of the Society, 
for the opportunity to provide testimony to the Appropriations 
Subcommittee on the Interior. I will be requesting appropriations from 
the Department of the Interior, Bureau of Indian Affairs (BIA), 
Wildlife & Parks budget (under Other Recurring Programs) for continued 
funding at the organization's fiscal year 1997 level of $488,000.
    The Society is a national non-profit organization dedicated to the 
sound management and prudent use of tribal fish and wildlife resources. 
The organization serves as a network among tribes throughout the 
country, including Alaska and provides training and technical 
assistance to tribes in natural resource planning and enhancement.
    The Society includes a membership of 136 tribes, which includes 32 
Alaskan Native villages and non-profit corporations, 1,200 individuals, 
numerous regional Commissions and Native organizations who are 
supportive of tribal fish and wildlife development and of the Native 
American Fish & Wildlife Society. All Society members share the common 
goal of protecting tribal sovereignty in the management and use of fish 
and wildlife resources.
    Due to our effective method of providing technical assistance, 
periodic trainings and general support to our members, the Society had 
an increase of 22 new member tribes to the organization in 1996. This 
represents a 17 percent increase in tribal memberships in fiscal year 
1996 and a 110 percent increase since 1995 and attests to the strong 
tribal support and the positive impact the organization has made in 
Indian Country. It is noteworthy to mention that because of our. large 
tribal membership base, the funding received through the federal 
appropriations process serves, at a minimum, 136 separate tribal 
governments.
    To date (in fiscal year 1996), the Society has provided technical 
services and assistance to over 133 tribes, 22 non-profits, 14 states 
and 11 different federal agencies in the areas of fish and wildlife 
management, education and environmental protection. Seven regional 
conferences, including Alaska, were held with associated technical work 
group meetings including: one national conference; four summer youth 
practicums; workshops on natural resource program development; 
development of fish and game codes, integrated resource management; 
fisheries; wildlife; wildlife management modeling, mutual gains 
negotiations, grant writing, ecosystem management, and environmental 
and conservation law enforcement. In conjunction with these activities, 
four quarterly newsletters (with a circulation of over 1,200 each), an 
annual report, promotion publications, informational management 
brochures and resource funding brochures were distributed nationwide.
    The Native American Fish & Wildlife Society represents a wealth of 
experience and information regarding management of fish and wildlife 
resources on Indian lands. Society members embody a diverse group of 
lay people, fishery biologists, wildlife biologists, foresters,
    conservation law enforcement officers, and land use managers and 
planners who currently manage tribal land bases throughout the country 
including Alaska.
    The concept of the Society is based on the necessity for an 
organization to assume a leadership role to maintain the technical 
proficiency of tribal fish, wildlife and natural resource programs. 
Because of its organizational structure, the Society is able to 
efficiently respond to specific requests from tribes for technical 
assistance regarding the development, enhancement and wise use of their 
natural resources.
    Members of the Society are involved in technical initiatives 
sponsored by the Society, as well as development of tribal technical 
fisheries, wildlife and recreation management initiatives critical to 
the preservation and protection of tribal resources. In addition, the 
Society continues to respond to the needs of its members in the area of 
technical assistance and program support.
    The Society has developed an organized structure to assist in 
documentation of tribal fish and wildlife management efforts from the 
tribal perspective, and the techniques currently being used 
successfully by tribal governments. Our members have immediate access 
to technical assistance gleaned from an extensive in-house natural 
resource library, a computerized data base entitled ``Tribal Watershed 
Forum'' (containing information on the number and variety of water 
related programs that have been initiated nationally on Native lands) 
and the Technical Services Office which is dedicated to assisting 
tribal governments and individual members with their technical needs.
    Collectively, American Indian tribes have a land base of 
approximately 94,000,000 acres, that includes thousands of miles of 
streams and rivers, and 730,000 lakes and impoundments. The wise use 
and management of these vast resources will only ensure that they 
remain intact for many generations to come. And because our work is so 
important, it is essential that we continue to receive funding so that 
we can carry on our goal to improve the general welfare of Indian 
people through charitable, educational, and other fish and wildlife 
related activities.
    The Society is currently the only national Native American 
organization that provides technical assistance to American Indian 
tribes, federal, state and local governments as well as private 
industry to develop and implement sound policies, ordinances, 
regulations, and laws to protect, preserve, conserve and prudently use 
and manage fish, wildlife and other natural resources. In addition, it 
supports and conducts natural resource and conservation law enforcement 
trainings as well as annual educational opportunities for Native 
American youth.
    fiscal year 1996 marked the fourth year that the Society has 
initiated the most pro-active budget in the organization's 16-year 
history. Funding has been set aside for each region to identify and 
conduct trainings and workshops in various aspects of natural resource 
management. Each region identifies its training needs and the logistics 
of the workshop is coordinated and funded by the Society's national 
office.
    Regional conferences feature forums and seminars that share 
information between tribal entities and programs as well as focusing on 
current trends in resource management. Such efforts have had a 
recognizable as well as a positive affect on the tribal resource base.
    Regional and National Youth Practicums are conducted by the Society 
for Native students who are interested in natural resource management 
careers. Such youth programs are an effective and unique method of 
providing hands on experience and instruction to these promising young 
people. The intent of these programs is to encourage their pursuit of 
further education and careers in natural resource management. To attest 
to the program's value and effectiveness, nine past Practicum students 
are currently in universities and colleges throughout the country 
pursuing degrees in natural resource management.
    As mentioned in both our oral and written testimony of 1995 and 
1996, the Society, in recognition of potential future funding cuts and 
an over-all lack of federal funding for tribal natural resource 
management, has aggressively moved forward and established the Native 
American Fish & Wildlife Foundation. It is important to note that our 
assertion to form this new entity was not mere rhetoric, but a sincere 
desire to actively work to become a self sufficient organization.
    The Society has shown its commitment to this endeavor by conducting 
grass roots fund raising activities and investing those funds 
exclusively to the project. To date, approximately $191,000 has been 
raised and utilized to hire a full-time Foundation Coordinator with the 
remainder being used to establish a permanent endowment.
    The Foundation has since been incorporated in the state of Colorado 
and has received IRS tax exempt status from the Internal Revenue 
Service. The new entity's Board of Trustees are currently being 
recruited and selected. Major fund raising activities continue on an 
on-going basis with an emphasis on securing large donations from the 
private sector (major corporations, foundations and the public at 
large).
    With the establishment of the Foundation, and once the 10 million 
dollars for the permanent endowment has been raised, the Society will 
no longer require federal funding and will, at the same time, be in the 
position to provide funding to tribes, via a small grants program, for 
their natural resource management efforts. It is important to note that 
once this is accomplished, the Society will be the first national 
Indian organization in the history of this country to become totally 
self supporting.
    At this time, and until we reach our goal of self sufficiency, 
Congress should view the federal funds appropriated to the Society as 
an investment which will be offering a return in the future via grants 
to tribal governments for natural resource management from the 
Foundation. It is critical that the Society continue to receive our 
current level of funding so that our important work with tribes, 
states, federal agencies and the private sector is not diminished while 
we work towards self sufficiency.
    Due to the current level of funding, the organization is in a 
position to better meet the needs and address the issues facing fish 
and wildlife management in Indian Country. The Society has been able to 
increase its outreach efforts (which is evident in the 110 percent 
increase of tribal memberships realized since fiscal year 1995), double 
the size of the annual Native American Environmental Awareness Summer 
Youth Practicum, more than double the number of trainings conducted in 
each Region, and provide adequate support for the seven regional 
conferences including the annual national conference. To reiterate, the 
Society is requesting a Total of $488,000 for fiscal year 1997.
    The Society is appreciative of the support and funding that we 
received for fiscal year 1997. Reinstatement of the organizations 
funding, back to the fiscal year 1995 level of $488,000, by both the 
House and Senate attests to the strong support and indispensable need 
for an organization, like the Society, to be working with Indian 
Country.
    The fact that the current level of funding ($488,000) allows the 
organization to deliver those services and technical assistance to the 
many individual members and member tribes as requested, the Society is 
not asking for additional dollars for fiscal year 1998. Instead, we 
request that our current level of funding be sustained for fiscal year 
1998 so that we may continue to support tribes in the area of natural 
resource management while we diligently work towards becoming self-
sufficient.
    In addition, the Society encourages legislation that allows tribes 
to participate in Federal Aid Funding and including tribes in any 
proposed future legislation addressing the Federal Aid program.
    The Society supports the White Mountain Apache Tribal Wildlife and 
Outdoor Recreation Program funding request for the following programs: 
Conservation Law Enforcement in the amount of $511,000; and Endangered 
Species Management in the amount of $180,000.
                                 ______
                                 
  Letter From Robert D. Brown, President, the National Association of 
               University Fisheries and Wildlife Programs
                               College Station, TX, March 17, 1997.
Senator Slade Gorton,
Chairman Senate Appropriations Subcommittee on Interior,
U.S. Senate, Washington, DC.
    Dear Senator Gorton: The National Association of University 
Fisheries and Wildlife Programs (NAUFWP) submits this statement in 
support of more adequate appropriations for important research and 
other essential activities to be carried out through the Biological 
Resources Division (BRD) of the U.S. Geological Survey.
    Members of the NAUFWP include 55 Universities. We seek to enhance 
public understanding of the needs for improving natural resource 
management and to advance the science and practice of sustainable uses 
and management of the resource base. Our efforts focus on cooperative 
work with partners and customers to advance research, education, 
extension and management to benefit people and communities throughout 
the country.
    Results from the Roper Starch fifth annual survey of adult 
Americans, prepared for the National Environmental Education and 
Training Foundation and released in December 1996, illustrate pressing 
needs for BRD's research, education and outreach programs. Key findings 
of adult views on natural resources provide an overall context in which 
to consider the specific figures in the President's proposed fiscal 
year 1998 budget. Adult Americans believe: Environmental resources 
should be conserved in ways that balance economic growth while 
protecting the environment and human health; natural resources can be 
managed in ways that protect wildlife and ecosystems while humans 
benefit from their planned use; Federal government spending should be 
shifted to environmental programs from other areas; and concerns for 
the environment and management of natural resources can be responded to 
by expanding education programs designed to raise current low levels of 
knowledge about the environment, such as to maintain and improve water 
quality.
    Within this context of public views and needs for research, 
education, extension and management, the NAUFWP supports continuing and 
strengthening BRD programs. Stronger programs are required to be more 
responsive to needs of the public and resource managers. Four specific 
recommendations are offered for the fiscal year 1998 appropriations for 
the BRD.
    1. Continue to support levels of funding that allow the BRD to 
respond to pressing needs to generate information on natural resources 
and their uses to (1) prevent adverse impacts on the resource base, (2) 
strengthen resource management, (3) educate and train students and 
adults, especially resource managers, (4) perpetuate sustained 
ecological, economic and social benefits, and (5) enhance the quality 
of life. Positive responses to citizens needs would be timely.
    2. Provide at least $145 million and 1,699 FTEs for the BRD in 
fiscal year 1998, as proposed in the President's budget. Regrettably, 
even this amount will not permit filling all vacancies in existing 
Cooperative Research Units. As you know, the states have public trust 
responsibilities for wild living resources within their boundaries. 
Both timely information and graduates from the Units are essential to 
help the states respond effectively to their responsibilities. 
Similarly, improved responses are required to support science that 
enhances the management of federal lands, restores Great Lakes 
fisheries and their habitats, and improves management of natural 
resources in other geographic locations.
    3. Provide firm support for the Cooperative Research Units, with 
their enviable track record of invaluable products and services 
generated for more than 60 years, as well as the essential Bird Banding 
Laboratory and Breeding Bird Survey. This unique Laboratory and Survey 
provide helpful scientific information available from no other source.
    4. Support research on the toxicity of various endrocrine-
disrupting compounds. Improved understanding of these compounds is 
required to prevent further adverse impacts on living creatures, 
including people.
    Please make this statement a part of the official hearing record of 
the Subcommittee on Appropriations for Interior.
            Sincerely,
                                           Robert D. Brown,
                                                         President.
                                 ______
                                 

    Prepared Statement of Wayne Pacelle, Vice President, Government 
        Affairs, the Humane Society of the United States [HSUS]

    The HSUS requests funding recommendations for the Fish and Wildlife 
Service [FWS] as follows: The Administration's $78.8 million request 
for implementing the Endangered Species Act [ESA] is inadequate; $1 
million and $400,000 are recommended for the African Elephant 
Conservation Act and the Rhino and Tiger Conservation Act, 
respectively; $830,000 for Land Acquisition; $100,000 for the Wild Bird 
Conservation Act; $500,000 for the Exotic Bird Conservation Fund; and 
$13.85 million for law enforcement. The Bureau of Land Management [BLM] 
requires $18.7 million for the Wild Horse and Burro Program and 
$300,000 specifically for wild horse immunocontraception.
              fish and wildlife service/endangered species
    The HSUS emphatically supports a strong and generous 
reauthorization of the ESA. We believe that many of the ESA's supposed 
deficiencies can be blamed on inadequate funding. Consequently, 
generously funding the ESA will significantly improve its success at 
saving species and preventing or solving potential conflicts. We 
believe that the Administration's request for $78.8 million for 
implementation of the ESA by the Fish and Wildlife Service is 
inadequate, especially with respect to funds for listing new species. 
There is a backlog of literally hundreds of species for whom 
consideration of listing has been dangerously delayed, threatening the 
species themselves and leaving land owners in a state of perpetual 
uncertainty. The FWS now is also carrying growing responsibilities for 
monitoring endangered and threatened species on federal lands and for 
designing and implementing Habitat Conservation Plans.
    The HSUS supports funding for the African Elephant Conservation Act 
at the Administration's requested level of $1 million. However, we 
would strongly recommend that the Fish and Wildlife Service use this 
money strictly for elephant conservation and not to support programs, 
such as Zimbabwe's CAMPFIRE program, that promote elephant hunting and 
reinstatement of the international commercial trade in ivory, both 
which harm elephant populations.
    The HSUS also supports funding for the Rhino and Tiger Conservation 
Act at the Administration's requested level of $400,000.
               fish and wildlife service/land acquisition
    The HSUS recommends the earmarking of $830,000 for direct 
acquisition and conservation easements for Red Rock Lakes National 
Wildlife Refuge. This magnificent refuge is the heart of Montana's 
Centennial Valley, a paradise for waterfowl and large mammals, as well 
as a critical corridor between populations of threatened grizzly bears 
and, potentially, endangered gray wolves. Red Rock Lakes is under 
immediate threat of development on its boundaries, development that 
will degrade its wetlands and sharply reduce its value to wildlife.
        fish and wildlife service/office of management authority
    The HSUS believes that additional funding in the amount of $100,000 
is needed for the Service's Office of Management Authority for 
permitting activities related to the Wild Bird Conservation Act [WBCA]. 
Implemented in 1992 after a unanimous vote by the Congress, the WBCA 
promotes the conservation of exotic birds in trade by ensuring that 
imports into the United States do not jeopardize wild populations. 
Prior to its enactment, the U.S. was the world's largest importer of 
birds and a contributor to the decline of many species in the wild. The 
implementation of the WBCA in fiscal year 1998 requires, among other 
things, the monitoring of trade levels and the biological status of 
species in the wild, the approval of sustainable use management plans 
submitted by foreign countries, and the processing and granting of 
import permits and petitions for actions pursuant to the WBCA.
    We also request $500,000 for the Exotic Bird Conservation Fund 
established by the WBCA. These funds would be used to assist other 
countries in the conservation of their indigenous wild birds. Funding 
this initiative will provide the FWS with an additional tool to 
encourage conservation of exotic birds in their countries of origin.
               fish and wildlife service/law enforcement
    Additional funding in the amount of $13.85 million is required to 
improve the FWS's ability to effectively monitor wildlife trade, 
intercept illegal trade, and improve the effectiveness of the Clark R. 
Bavin National Fish and Wildlife Forensics Laboratory.
    Millions of animals, and their parts and products, travel through 
U.S. ports each year. The United States is the world's largest wildlife 
trading country, importing $773 million and exporting $256 million each 
year. The illegal trade into and out of the U.S. is estimated to be 
worth between $100 million and $250 million annually. The FWS is 
supposed to monitor this trade, and intercept illegal trade, by 
physically inspecting wildlife shipments. About 77,000 shipments are 
processed annually.
    A December 1994 U.S. General Accounting Office (GAO) report gave 
the Service poor marks for monitoring wildlife trade and intercepting 
illegal wildlife trade. The report found that only about 25 percent of 
wildlife shipments are physically inspected, and, as a result, only 
about 10 percent of illegal shipments are detected. Under staffing and 
limited resources were cited as causing the Service's poor performance. 
Consequently, we believe that an additional 60 Special Agents, 12 
Wildlife Inspectors, and appropriate support staff are needed to 
adequately administer the law enforcement program.
    In addition, the Bavin Laboratory, which provides wildlife 
forensics for the Service, has experienced an over-whelming increase in 
caseload since its inception and will need to double its current staff, 
an increase of 30 persons, and will need $6 million for construction of 
additional facilities.
    We request an increased allocation to the FWS's Washington Office 
Division of Law Enforcement for the purpose of funding special 
investigations by the Branch of Special
    Operations. Investigations of complex international and domestic 
wildlife crimes, which are multi-regional, as well as multi-national, 
particularly cases relating to violations of the Endangered Species 
Act, Convention on International Trade in Endangered Species of Wild 
Fauna and Flora (CITES), Marine Mammal Protection Act and other 
relevant laws, can only be conducted by the Branch of Special 
Operations. As the most productive unit within the Division of Law 
Enforcement, the Branch of Special Operations experienced numerous 
successes in 1996, which resulted in the sentencing of wildlife 
smugglers.
   bureau of land management/wild horse and burro program/fertility 
                            control research
    Recent public and press attention has focused on the serious 
deficiencies of the Bureau of Land Management's Wild Horse and Burro 
program. We believe that, in principal, this is a highly valuable 
program: America's wild horses are a public trust greatly beloved by 
the American people, and any indication that these animals are being 
treated inhumanely generates immediate public outrage. Consequently, 
The HSUS recommends that the Administration's budget request of $18.7 
million for the Wild Horse and Burro program be fully funded. Within 
the program, however, funds should be shifted from the adoption program 
to on-the-ground management of horses and their range, especially wild 
horse monitoring, range monitoring, and habitat restoration.
    The BLM currently spends more than $1,000 for each wild horse that 
is removed from public lands and processed through the Adopt-a-Horse 
program. Even at that level of spending, the Bureau cannot guarantee 
humane treatment and adequate care to the 4,000 or more wild horses 
adopted each year.
    The HSUS believes that fertility control, if used as part of a 
scientifically-based and equitable range management plan, can reduce 
human-caused stress on wild horses and burros, improve care for animals 
entering the adoption program, and reduce the costs of wild horse and 
burro management. The National Park Service is already using 
immunocontraception to control feral horse herds at Assateague Island 
National Seashore, and has proposed its use at two other sites.
    Funds appropriated by Congress in fiscal year 1993-97 have made 
significant contributions to the development of a one-shot 
immunocontraceptive vaccine to prevent pregnancy in western wild horses 
for at least one full year, and provided principal support for two 
successful field trials on Nevada wild horses. In the first (1992) 
field trial, 131 mares were contracepted; in the 1996 field trial, 267 
mares were treated with either one-or two-shot vaccine preparations, 
with an apparent success rate of about 95 percent for both 
preparations.
    We remind Congress that every foal not born potentially saves the 
Bureau over $1,000 in adoption costs, and thus, that, even in the 
research phase, the vaccine is highly economical. Consequently, we 
request $300,000 from Congress in fiscal year 1998 to support further 
research in wild horse immunocontraception. These funds would support 
the refinement of a one-shot vaccine that is effective for at least two 
years, long-term studies needed before the immunocontraceptive vaccine 
can be used on a broad scale, and at least two additional field 
projects that should reduce wild horse population growth, reduce the 
number of horses that enter the Adopt-a-Horse program, and thereby 
recover the cost of the research.
    The HSUS offers the following recommendations for modifications to 
the Wild Horse and Burro Program that will alleviate the troubling 
problems that exist in its current implementation:
    (1) Allocate a 50-percent increase in funding for contraception.
    (2) Raise the adoption fee to a minimum of $250 for a horse or 
burro and allow competitive bidding.
    (3) Reverse the current trend toward reducing the number of wild 
horses on the range. Reductions in wild horse numbers in recent years 
are threatening the viability of many herds.
    (4) Restore the voice of the public in influencing decisions. The 
BLM has been using the ``full force and effect'' regulation, which was 
primarily intended for emergency situations, to effectively remove the 
public's opportunity to influence decisions to remove horses from the 
range.
    (5) Include in title transfers a contractual, binding agreement 
stating that the horse or burro will not be sold for slaughter and 
prohibit slaughter plants from accepting BLM freeze branded horses.
    (6) Implement a post-adoption, voluntary monitoring system using 
the national network of humane societies.
    These reforms will benefit the program in general, the animals 
themselves, and the public. The HSUS stands ready to work with the BLM 
on this issue.
                                 ______
                                 

Prepared Statement of Christine Stevens, Secretary, Society for Animal 
                         Protective Legislation

                                wildlife
    The urgency of an increase of at least $7 million for the Law 
Enforcement Division of the U. S. Fish and Wildlife Service has become 
more serious this year than ever before. The enormous increase in 
organized crime directed towards wildlife makes it absolutely essential 
that the Congress provide effective deterrents. This means the Special 
Agents, with the necessary backup, must be increased so that criminals 
do not have a free run.
    Please don't forget that importation of drugs is intimately tied 
with importation of live wildlife, much of it endangered, and products 
from animals illegally killed for the trade. The United States is 
facing unprecedented attack by professional smugglers tied in with such 
groups as the Chinese Triads, the Russian Mafia and the Japanese 
Yakuza, as well as our home-grown organized criminals, and we must 
fight back.
    I respectfully urge this Subcommittee, which has funded Interior 
over the years, to recognize the crisis and give Fish and Wildlife 
Service Law Enforcement the tools it so desperately needs to stem the 
flow of criminally acquired and smuggled wildlife.
                               elephants
    This Subcommittee provides funds for the African Elephant 
Conservation Act under which grants are made to American and foreign 
groups. Unfortunately a foreign group known as CAMPFIRE (Communal Areas 
Management Programme For Indigenous Resources) in Zimbabwe is trying to 
overturn U. S. policy with respect to the African elephant.
    In 1989, the U.S. played a leading role in obtaining Appendix I 
(endangered) status for the African elephant? whose populations had 
been decimated by poachers and smugglers for the ivory trade. The large 
majority of African nations demanded Appendix I status because they 
were being robbed of the elephants who lived within their borders.
    The Convention on International Trade in Endangered Species of Wild 
Fauna and Flora (CITES) first tried to curb this criminal activity 
through the use of quotas, but after several years of utter failure, 
the nations belonging to CITES voted to end the international trade in 
ivory by placing the elephant on Appendix I. But Zimbabwe's CAMPFIRE, 
egged on by Africa Resources Trust (ACT), a trophy hunting organization 
based in London, has lobbied in this country to overturn the ban on 
international trade in elephant parts and products. Rhodesia, a 
formidable colonial power named for the British explorer Cecil Rhodes, 
became Zimbabwe in 1980, but Rhodesia lives on in the ART Board.
    We urge this distinguished Subcommittee to omit any funding for 
CAMPFIRE or organizations such as Safari Club International which 
donate to CAMPFIRE under the African Elephant Conservation Act. Not 
only is CAMPFIRE funded under this Act, but by USAID in separate 
government funding which is now under serious investigation.
    With the scheduled tenth meeting of the CITES Parties in Zimbabwe 
June 9-20, 1997, it is essential that the United States uphold its 
established policy with respect to the African elephant and other 
Appendix I species currently being eyed by the commercial ivory trade 
and commercial trophy hunters.
    Projects funded under the African Elephant Conservation Act, which 
falls into your jurisdiction, must not be geared to overturning 
American policy.
                        steel jaw leghold traps
    I wish to commend the Subcommittee on its wise 1996 Report language 
relating to steel jaw leghold traps. It is most regrettable that the 
proposal envisaged was preempted by the Fish and Wildlife Service.
    The Service compounded this egregious behavior by advising and 
encouraging USDA's Animal Damage Control operatives to use an enormous, 
sensationally cruel steel jaw leghold trap with teeth on a pathetic 
six-month-old wolf pup who is part of the scheme to reintroduce wolves 
to Yellowstone National Park. The reintroduction scheme was paid for by 
U.S. taxpayers, as was the trap and the ill-advised, ill-conceived and 
basically cruel actions of Fish and Wildlife Service employees. The 
American public does not want its taxes to be used for such a purpose. 
In a November 1996 public opinion poll conducted by Caravan Opinion 
Research Corporation of Princeton, New Jersey, 74 percent of the 
American public said they want steel jaw leghold traps banned. 
Certainly they should not be compelled to contribute to their use.
    Here are notes on the cruel suffering of the wolf pup, documented 
by a veterinarian and a government employee:
    July 11.--``* * * foot severely swollen from carpus down, puncture 
wound with pus flowing out at distal carpus, severe bruising and soft 
tissue trauma.''
    July 14.--``* * * still not eating.''
    July 15.--``* * * swelling still pronounced * * * more necrotic 
tissue present.''
    July 16.--``Still not eating.''
    July 17.--``Much tissue loss and self mutilation of toes (gone). 
Foot dead. Foot should be removed or wolf put down.''
    July 18.--``* * * food not eaten.''
    July 19.--``Removed left front leg * * *''
    We urge you to adopt Report language denying funds for any use of 
steel jaw leghold traps under the wolf reintroduction scheme so that 
further inhumane treatment of introduced wolves is not repeated by Fish 
and Wildlife Service personnel. This young wolf was subjected to 
intense torture for at least 30 hours during which there was no 
inspection of the trap. Most states require at least 24-hour 
inspection, but the inept judgment of these wolf transplanters and 
their tolerance for the pain of animals led to this typical result of 
the use of steel jaw leghold traps. It is rare for a trapped animal to 
be kept under veterinary surveillance for a week after having been 
trapped, so this record gives us an idea of what this most cruel of all 
traps inflicts on its victims. I trust you will take the action which 
lies within your jurisdiction. You can be sure the vast majority of 
your constituents will welcome a humane decision.
                                 ______
                                 

      Prepared Statement of Susan H. Gunn, Director of Budget and 
                 Appropriations, the Wilderness Society

    The Wilderness Society appreciates this opportunity to present our 
views on the fiscal year 1998 funding needs of natural resource 
programs within the Committee's jurisdiction. The Wilderness Society 
has made increased funding of the four land management agencies and the 
Land and Water Conservation Fund one of its highest priority issues for 
the upcoming years. The following document outlines an initiative to 
increasing the 602(b) allocation to the Interior Appropriation 
Subcommittee by $570 million in fiscal year 1998 to meet critical 
environmental needs within these programs.
                    public lands funding initiative
Introduction
    The public lands of the United States--our National Parks, Forests, 
Grasslands, and Wildlife Refuges--are held in trust for current and 
future generations of Americans. Since the election a number of 
organizations from the environmental, recreation, and conservation 
community have been meeting to coordinate an initiative to address the 
funding needs of America's public lands. The public lands community 
plans to make this a long-term campaign that will help frame the budget 
debate while focusing on the message that we can balance the federal 
budget without abandoning America's public lands.
    We plan to convince a majority in Congress that this is an area 
where additional cuts are not justified, and further, that incremental 
increases in the public lands budget are necessary to protect the 
nation's forests, parks, refuges, and wildlife. A successful effort 
will mean that we can maintain accessibility to these lands and improve 
their ecological health.
    This proposal establishes annualized budget goals for several 
Department of Interior agencies and the U.S. Forest Service. The 
environmental, conservation, and recreation community will also be 
working toward eliminating ecologically damaging federal programs and 
subsidies.
Budgetary growth: an incremental approach
    The following table depicts needed increases above the fiscal year 
1997 spending levels for the 602(b) Interior and Related Agencies 
Budget Allocation. The table identifies the budgetary increases 
necessary to accommodate public land management over a 6-year period. 
Under this scenario, much needed funding for currently unmet public 
land conservation needs can be achieved by fiscal year 2003 through 
annual increases in the 602(b) budget allocation.
    The fiscal year 1997 Interior Appropriation, less emergency funds, 
is $12.4 billion in budget authority. The first line in the table 
(Resulting Allocation) presents, in real dollars, the recommended 
annual funding increases relative to fiscal year 1997 and not the total 
allocation for Interior and Related Agencies Subcommittee. The second 
line represents the funding additions to fiscal year 1997 levels for 
the agencies and programs specified in this document.

  INCREASED 602(b) ALLOCATIONS: AN INCREMENTALAPPROACH TO BUDGET GROWTH INCREASES OVER FISCAL YEAR 1997 FUNDING 
                                                     LEVELS                                                     
                                              [Billions of dollars]                                             
----------------------------------------------------------------------------------------------------------------
                                                                           Fiscal years--                       
                                                  --------------------------------------------------------------
                                                     1997     1998     1999     2000     2001     2002     2003 
----------------------------------------------------------------------------------------------------------------
Resulting allocation.............................   $12.40   $12.97   $13.33   $13.68   $14.04   $14.39   $14.68
Yearly 602(b) increase...........................  .......    $0.57    $0.36    $0.35    $0.36    $0.35    $0.29
Increase from prior fiscal year (percent)........  .......     4.60     2.78     2.63     2.63     2.49     2.02
Total 602(b) increase............................  .......    $0.57    $0.93    $1.28    $1.64    $1.99    $2.28
----------------------------------------------------------------------------------------------------------------

    The proposal speaks to the funding needs and program areas of the 
agencies and programs identified herein only. It does not account for 
or anticipate changes in funding levels for other agencies or programs 
that also receive funding through the Interior and Related Agencies 
Appropriations bill. Nor does it anticipate specific cost savings or 
budget offsets that may be achieved through reductions in other 
programs areas within the Interior and Related Agencies Appropriations 
bill. It further does not address funding needs for natural resource 
and environment programs and agencies which receive funding through 
appropriation bills other than Interior and Related Agencies.
Increased funding needs
    In developing our recommendations, we examined budget priorities 
for the four federal land management agencies: Fish and Wildlife 
Service, National Park Service, U.S. Forest Service, and the Bureau of 
Land Management. In addition, we considered Land and Water Conservation 
Fund needs. Increases outlined for each allocation are to be achieved 
over a six-year period.
            Fish and Wildlife Service: proposed increase of $495 
                    million.
    Increases are needed for the Fish and Wildlife Service in National 
Wildlife Refuge System (NWRS) Operations and Maintenance (O&M) and 
Endangered Species activities.
    The National Wildlife Refuge System is the only federal public land 
system dedicated primarily to the conservation of fish and wildlife. 
Chronic underfunding of Refuge Operations and Maintenance has led to 
the degradation of refuge habitat and wildlife populations and put at 
risk popular wildlife oriented recreation programs. The Fish and 
Wildlife Service has identified a $440 million maintenance backlog and 
an annual operations deficit of $150 million.
    More than 200 refuges have no staff and 97 percent of refuges 
operate at minimum funding levels with substantial maintenance 
backlogs. Exotic species, inadequate water supplies, and other problems 
plague many refuges, undermining the ability to meet wildlife 
objectives. Programs to help recover endangered, threatened, and 
candidate species, restore habitats, and address resource threats are 
left unaccomplished on an increasing number of stations. Continued 
failure to address this severe funding shortfall will jeopardize the 
integrity of the NWRS.
    Funding for the Endangered Species Act has been chronically 
inadequate and the Agency has experienced an increase in tasks related 
to endangered and threatened species. For example, the Fish and 
Wildlife Service has become increasingly responsible for scientific 
monitoring for the conservation of endangered and threatened species on 
federal lands in addition to the increased costs related to designing 
and implementing Habitat Conservation Plans. The Fish and Wildlife 
Service has been sharply criticized for failing to complete its duties, 
yet it has never been given adequate funds to accomplish its goals. The 
result is implementation that is sometimes scientifically weak or 
frustratingly slow for permit applicants.
    Adequate funding will promote speedier, less costly recovery, and 
smooth implementation, ultimately minimizing conflict surrounding ESA. 
In addition, it is important to note that the anticipated 
reauthorization of the Endangered Species Act could result in new 
obligations under the law. The funding recommendations herein cover 
only current obligations and may require adjustment pending the outcome 
of reauthorization.
            Bureau of Land Management: proposed increase of $150 
                    million.
    The BLM needs increased funding for Management of Lands and 
Resources. Because of the scope and diversity of its land base, the BLM 
faces the opportunities and challenges of managing for over 3,000 
species of vertebrates and 25,000 plant species in habitats ranging 
from the Pacific sea coast to the arctic tundra to the Sonoran Desert. 
BLM lands offer a variety of recreational opportunities and cultural 
resources and generate significant associated revenues. Yet, many 
species in each of these habitats are experiencing degraded habitats 
and declining populations. Likewise, many public land recreational 
opportunities are either hampered by degraded resource conditions or 
are themselves the cause of public land resource damage.
    Ecological and cultural resource monitoring, restoration, and 
protection must be elevated to a top priority for the BLM. To that end, 
funding for riparian restoration and protection, fish and wildlife 
management, and wilderness management must be increased, as well as 
funding for the management of cultural resources and recreational 
activities including staff support on public lands.
            Forest Service: proposed increase of $225 million.
    Estimates of Forest Service funding needs include Recreation, 
Ecosystem Research, Fish and Wildlife, and Trails. Funding in these and 
other critical areas fell short in fiscal year 1997, and estimates 
indicate a need for incremental increases in funding for trails, 
recreation, and ecosystem research. Fish and Wildlife activities are 
also underfunded including migratory bird management, and Partners in 
Flight. The condition of the trails, campgrounds, restrooms, and other 
recreation facilities at our nation's forests is key to the public's 
experience outdoors. Maintenance and reconstruction funds have not kept 
up with increased use. For example, the Forest Service estimates that 
the value of the backlog of trail reconstruction work has climbed to 
over $267 million.
    The Forest Service's trail system is larger than all the other 
trail systems in the nation with over 124,000 miles of trail. Because 
of inadequate funds, the Forest Service has been deferring 20 to 30 
thousand miles of trail reconstruction every year since the 1980s.
            National Park Service: proposed increase of $600 million.
    The National Park system today faces tremendous threats and 
challenges, including degradation of cultural, scenic, and natural 
resources, air and water pollution, internal and external development, 
and overcrowding. These threats have a direct impact on the quality of 
the National Park experience and the National Park Service's ability to 
protect and manage America's Park resources.
    The Park Service's ability to adequately address these threats is 
limited by insufficient funding for monitoring, scientific assessment, 
research, resource protection and interpretation, and staff support. In 
constant dollars, the total National Park Service congressional 
appropriation declined by more than $200 million between 1983 and 1997. 
At the same time, Congress assigned the Park Service more than 400 
additional construction projects than it requested--costing more than 
$867 million. In addition, Congress designated nine new heritage areas 
at the end of the 104th Congress without appropriating money to fund 
them. Finally, the Agency needs sufficient funds to enable it to 
address ongoing operations and maintenance needs and certain backlogged 
maintenance needs as well.
            Land and Water Conservation Fund: proposed increase of $750 
                    million.
    Congress has provided for an annual revenue stream of $900 million, 
funded primarily from OCS receipts, for federal and state land 
acquisition and recreation projects. Yet the average funding for these 
purposes over the last seventeen years has been approximately one-
fourth of the authorized level.
    Full appropriation of the Land and Water Conservation Fund is 
critical to provide for investment in natural and cultural resources 
conservation, watershed protection, wildlife habitat, and recreational 
resources. Unrestrained development and dramatic population increases 
threaten the quality of existing public lands. The need to purchase and 
conserve additional available land and water resources is increasingly 
urgent. This is true at the federal and state level, and the Congress 
should recommit to statewide assistance by funding the State Grant 
Program.
            USGS Biological Resources Division: proposed increase of 
                    $60 million.
    Increases are needed to supply the science support necessary to 
understand the biological resources located on federal lands, to assess 
the environmental changes impacting on these biological resources, and 
to develop recommendations for management actions necessary to conserve 
the lands for the future. No integrated monitoring strategy for Federal 
Lands exists which can inventory critical biological species and 
communities at the local level and suggest solutions to land managers 
for conservation of these resources. Additionally, Federal trust 
resources such as migratory birds and endangered species, common to all 
Federal lands are coming under additional pressure through degradation 
of wildlife habitats; more emphasis on science support for adaptive 
management recommendations for system management in aquatic resources, 
and integrate biological information with geologic, hydrologic, and 
demographic databases.
General
    Particularly where the BLM and Forest Service are concerned, there 
are any number of environmentally beneficial cost savings and budget 
offsets that could be achieved by increasing revenues for extractive 
uses (mining, grazing) and by eliminating costly subsidies. In 
addition, commercial user fees and concession fees are also potential 
sources of revenue and cost offsets.
    While it is clear that substantial savings and budgetary offsets 
can be achieved through these types of reforms, the purpose here is not 
to develop a comprehensive package of recommended budget cuts and 
offsets, but to identify the unfunded and underfunded spending 
priorities that are being targeted by the public lands community.
                                 ______
                                 
Letter From Andy Sawyer, Chapter Chair, Sierra Club Mother Lode Chapter
                                    Sacramento, CA, April 11, 1997.

Re Fiscal year 1998 land and water conservation fund appropriations/
        Stone Lakes National Wildlife Refuge.

Hon. Slade Gorton,
Chairman, Interior Appropriations Subcommittee,
U.S. Senate, Washington, DC.
    Dear Chairman Gorton and Subcommittee Members: The Mother Lode 
Chapter of the Sierra Club, on behalf of its 14,000 members and 10 
affiliated local groups, respectfully requests that the Subcommittee 
appropriate $5.5 million dollars for land acquisition at the Stone 
Lakes National Wildlife Refuge in fiscal year 1998 (fiscal year 1998). 
In addition, we urge the Subcommittee to increase overall 
appropriations from the Land and Water Conservation Fund (LWCF) in the 
fiscal year 1998 Interior and Related Agencies Appropriations Bill.
    The Mother Lode Chapter (MLC) of the Sierra Club encompasses much 
of central and eastern Northern California, including the northern 
portions of California's Central Valley and Sierra Nevada. MLC and its 
members have long been active in preserving open space and critical 
habitats throughout this area. We therefore appreciate the efforts of 
your subcommittee to secure funding important land acquisition projects 
through the LWCF. Your efforts have helped ensure the conservation of 
thousands of acres of open space, recreation lands, and wildlife 
habitat highly valued by our members. These resources will provide 
invaluable recreational and educational benefits to future generations 
of Northern Californians.
    We know that your work demands difficult choices and that you have 
always given conservation needs the highest consideration. MLC is 
concerned, however, that if funds available from the LWCF are limited 
to levels most recently appropriated available funds will be 
insufficient to meet the growing public recreational and wildlife 
habitat requirements associated with increasing human population 
pressures. We fear that without adequate funding, conservation 
opportunities may be lost. We therefore recommend that appropriations 
from LWCF be increased substantially over last year (fiscal year 1998) 
and eventually reach the Fund's mandated level of $900 million per 
fiscal year. Only in this way can important public acquisitions keep 
pace with increasing public needs.
    In our region we are dealing with these issues through local 
efforts to preserve open space and habitat at the Stone Lakes National 
Wildlife Refuge (NWR). Stone Lakes NWR is located in southern 
Sacramento County, only a few miles from urban Sacramento. Since its 
inception in 1994, Stone Lakes has been able to offer limited hiking, 
canoeing, wildlife viewing and conservation education opportunities to 
the two million residents of the Sacramento metropolitan region.
    The Refuge, which is adjacent to the Sacramento River, contains 
remnants of the Central Valley's once vast complex of permanent and 
seasonally flooded wetlands flanked by riparian forests, oak woodlands, 
and annual grasslands. The Central Valley region is projected to 
experience 40 percent of the growth in the state's expected tripling of 
population by the year 2040; the already intense development pressures 
on remaining natural areas will only increase, rendering future land 
acquisitions prohibitively expensive. If appropriations are postponed 
the opportunity to purchase property at an acceptable cost will be 
lost. The MLC urges the Subcommittee to appropriate $5.5 million 
dollars from LWCF in fiscal year 1998 for U.S. Fish and Wildlife 
Service property acquisitions from willing sellers within the Stone 
Lakes NWR authorized area. The appropriations will protect essential 
wildlife habitat that would otherwise be lost to land speculation and 
development. We also believe these acquisitions eventually will enable 
the USFWS to expand the wildlife-compatible recreational and 
educational opportunities available to the public at Stone Lakes NWR.
    Thank you for your consideration of these comments. We are grateful 
for this opportunity to include our written testimony in the official 
hearing record.
            Sincerely,
                                               Andy Sawyer,
                                                     Chapter Chair.
                                 ______
                                 
     Letter From Gary O. Fregien, President, California Parks and 
                        Conservation Association
                                    Sacramento, CA, April 10, 1997.

Re Fiscal year 1998 funding for Stone Lakes National Wildlife Refuge.

Hon. Slade Gorton,
Chairman, Senate Interior Appropriations Subcommittee,
U.S. Senate, Washington DC.
    Dear Senator Gorton: By this letter, the California Parks and 
Conservation Association (CalParks) is asking for your support for the 
proposal to provide the Stone Lakes National Wildlife Refuge with $12.8 
million in funding for fiscal year 1998. This is the amount sought by 
the refuge's principal citizen support group, the Stone Lakes Refuge 
Alliance.
    As you may know, Sacramentans have been working for the protection 
of this valuable land for more than twenty-five years. Once the site of 
a proposed Corps of Engineers flood control project, then the target of 
a private developer's 50,000-resident ``new town'' proposal, this 
relatively small but immensely valuable property is now one of the 
newest national wildlife refuges.
    CalParks seeks substantial funding for fiscal year 1998 because the 
refuge is in need of significant support in its early years. Located 
just south of the City of Sacramento, it lies in the path of new 
urbanization that can only increase land values and thus inflate the 
cost of expanding the refuge to the boundaries called for in the 
approved 1992 plan.
    The $5.5 million which we seek for land acquisition in fiscal year 
1998 will go only for land purchased from willing sellers, people who 
the Fish and Wildlife Service needs to deal with quickly before they 
(the owners) get discouraged at government delays and are courted by 
developers offering more for their land than they are asking today. You 
should know that this refuge ranked third in the nation on the Fish and 
Wildlife Service's land acquisition priority list for 1998. Nationwide, 
this acquisition is very important, very high in priority.
    The $0.3 million requested for operations and management will be 
used not only for the day-to-day activities which keep the refuge 
going, it will also be used to fund programs to enhance the 
productivity and carrying capacity of the refuge lands so as to 
increase their value for native and migratory wildlife. Even today, the 
refuge's modest operations budget has allowed limited public use of the 
facility, with an emphasis on educational programs for local school (K-
12) groups.
    The $7 million sought for the construction of a conservation 
education facility will allow the refuge to provide educational and 
recreational opportunities for an estimated 200,000 visitors annually. 
This facility will educate the public in conservation and environmental 
matters and, to some degree, bolster the local economy through the 
expenditures of non-local people who visit the refuge and the facility.
    You may be assured that this refuge has widespread support in the 
Sacramento region, from public officials, organizations and 
individuals. We urge the support of you and your subcommittee to 
continue the development of this important wildlife refuge.
            Sincerely,
                                           Gary O. Fregien,
                                                         President.
                                 ______
                                 
       Letter From Patrice Cox, President, Sacramento Open Space
                                    Sacramento, CA, April 10, 1997.

Re Fiscal year 1998 funding for Stone Lakes NWF.

Hon. Slade Gorton,
Chairman, Senate Interior Appropriations Subcommittee,
U.S. Senate, Washington, DC.
    Dear Senator Gorton: By this letter, Sacramento Open Space is 
asking for your support for the proposal to provide the Stone Lakes 
National Wildlife Refuge with $12.8 million in funding for fiscal year 
1998. This is the amount sought by the refuge's principal citizen 
support group, the Stone Lakes Refuge Alliance.
    Sacramentans have been working hard for the protection of this 
valuable land for more than twenty-five years. Once the site of a 
proposed Corps of Engineers flood control project, then the target of a 
private developer's 50,000-resident ``new town'' proposal, this 
relatively small but immensely valuable property is now one of the 
newest national wildlife refuges.
    Sacramento Open Space seeks substantial funding for fiscal year 
1998 because the refuge is in need of significant support in its early 
years. Located just south of the City of Sacramento, it lies in the 
path of new urbanization that can only increase land values and thus 
inflate the cost of expanding the refuge to the boundaries called for 
in the approved 1992 plan.
    The $5.5 million which we seek for land acquisition in fiscal year 
1998 will go only for land purchased from willing sellers, people who 
the Fish and Wildlife Service needs to deal with quickly before they 
(the owners) get discouraged at government delays and are courted by 
developers offering more for their land than they are asking today. You 
should know that this refuge ranked third in the nation on the Fish and 
Wildlife Service's land acquisition priority list for 1998. Nation-
wide,this acquisition is very important, very high in priority.
    The $0.3 million requested for operations and management will be 
used not only for the day-to-day activities which keep the refuge 
going, it will also be used to fund programs to enhance the 
productivity and carrying capacity of the refuge lands so as to 
increase their value for native and migratory wildlife. Even today, the 
refuge's modest operations budget has allowed limited public use of the 
facility, with an emphasis on educational programs for local school (K-
12) groups.
    The $7 million sought for the construction of a conservation 
education facility will allow the refuge to provide educational and 
recreational opportunities for an estimated 200,000 visitors annually. 
This facility will educate the public in conservation and environmental 
matters and, to some degree, bolster the local economy through the 
expenditures of non-local people who visit the refuge and the facility.
    You may be assured that this refuge has widespread support in the 
Sacramento region, from public officials, organizations and 
individuals. We urge the support of you and your subcommittee to 
continue the development of this important wildlife refuge.
    Sincerely,
                                               Patrice Cox,
                                                         President.
                                 ______
                                 

    Prepared Statement of Ted James, Planning Director, Kern County 
   Planning Department; Steven J. Arita, Environmental Coordinator, 
  Western States Petroleum Association; Manual Cunha, Jr., President, 
   Nisei Farmers League; Les Clark, Vice President, Independent Oil 
 Producers Association, on behalf of Kern County Valley Floor Habitat 
          Conservation Plan Industry and Government Coalition

    Mr. Chairman and Members of the Subcommittee: On behalf of the 
California Industry and Government Coalition for the Kern County Valley 
Floor Habitat Conservation Plan (KCVFHCP), we are pleased to submit 
this statement for the record in support of our funding request for the 
Interior Appropriations Bill for fiscal year 1998.
    First, the Coalition supports the Department of Interior's budget 
request of $14 million for the Cooperative Endangered Species 
Conservation Fund--especially the $6 million funding for HCP land 
acquisition.
    Secondly, the Coalition urges the Subcommittee to appropriate 
additional funding for land acquisition above the $6 million requested.
    The Coalition's request is supported by the timely need to 
implement the KCVFHCP, which is in the final stages of development and 
expected to be completed by the end of calendar 1997. We are hopeful 
that our pending application for $500,000, from previously appropriated 
funds, for the current (1997) fiscal year will be successful. However, 
to secure the $6 million total necessary for full implementation of the 
plan, we will require $2.75 million for fiscal year 1998 and $2.75 
million for fiscal year 1999.
    The Coalition requests that the Subcommittee appropriate the 
maximum possible amount for this program, so that the funding pool can 
accommodate our request and need. We are confident that the plan's 
merits and urgency support this request.
    Kern County's program is unique from other regions in the nation in 
that it contains some of the highest concentrations of plant and animal 
species protected by the Endangered Species Act (ESA) within the 
continental United States. The region is occupied by 13 wildlife 
species and 14 plant species listed as threatened or endangered under 
federal law. The potential for conflict with the federal ESA is great 
in Kern County because of the extensive agricultural and oil and gas 
production activities which occur. Since Kern County is the top oil 
producing county in the nation and one of the leading agricultural 
counties, potential conflicts with the ESA and their resolution through 
a proactive conservation program has significant national importance.
    In recognition of the conflicts posed to economic growth by federal 
and state endangered species laws, a joint agency Memorandum of 
Understanding was entered into by the U.S. Fish & Wildlife Service, 
Bureau of Land Management, California Energy Commission, California 
Department of Oil & Gas and Geothermal Resources, California Department 
of Fish & Game and Kern County. The participating agencies agreed to 
develop a unified conservation strategy with the goal of providing a 
streamlined and consistent process of complying with State and Federal 
endangered species laws, yet at the same time allow important industry 
activities such as oil and gas, agricultural, ranching, and other 
industry activities to continue. Preparation of the KCVFHCP began in 
1989 and involved a number of federal, state and local government 
agencies, as well as the oil and gas industry, agricultural, utilities 
and environmental groups.
    Kern County's Valley Floor Habitat Conservation Plan (KCVFHCP) is 
one of the largest and most diverse endangered species conservation 
programs under development in the nation. The program embraces many of 
the conservation approaches that have been advocated by the Department 
of Interior, in that it represents a significant departure from 
traditional endangered species conservation programs which utilize 
prohibitory controls to assure conservation of species habitat. 
Instead, it is based on a system of trading habitat credits in an open 
market. In that regard, the KCVFHCP is considered to be a state-of-art 
conservation plan that will address compliance with the ESA for 
multiple threatened and endangered species. This innovative and state 
of the art system, for the first time, provides landowners with real 
incentives and more importantly, the ability to choose how best to 
manage their own private property. The KCVFHCP is in the final states 
of development and is scheduled to be completed in 1997. The second 
draft of the HCP document will soon be released, and we are currently 
in the process of developing work on the Implementing Agreement.
    Numerous agencies, in concert with the State of California and 
local government entities, as well as the private oil and gas and 
agricultural industries have contributed funding, time and other 
resources toward developing the KCVFHCP. Currently, the KCVFHCP program 
will be completed in the fall, 1997, provided there is the necessary 
federal funding for the acquisition of habitat to mitigate for 
agricultural and oil AND gas operations and development. As mentioned 
previously, we are currently in the process of securing funding in the 
amount of $500,000 for this fiscal year; however, additional funding is 
critical to completing the HCP. This is one of the final steps 
necessary to implement the conservation strategy. Because of the 
extensive private, local and state government financial support that 
went into the development of this program, federal participation in 
program implementation will demonstrate that the burden of ESA 
compliance is not being placed exclusively on private property owners. 
Program funding will also contribute to eventual species recovery.
                         program funding needs
    In order for the KCVFHCP to be implemented, the program requires 
funding in the amount of $5.5 million (provided we are successful in 
securing $500,00 this fiscal year) that could be funded in increments 
over the first several years of the program. A breakdown of the purpose 
and amount of this funding is as follows:
Fallow lands issue
    Agricultural practices and the lack of available water often result 
in situations where substantial amounts of previously farmed land 
(20,000 acres plus or minus) are placed in a fallow state. This 
situation invites the reintroduction of species into these areas which 
create potential ESA compliance problems when the farmer decides to 
reuse the land for agricultural purposes. Many farmers are forced to 
unnecessarily disc fallow lands to prevent endangered species 
recolonization.
    The KCVFHCP has devised a strategy that includes the purchase and 
set aside of approximately 3,000 acres of endangered species habitat to 
mitigate for species loss resulting from reuse of fallow agricultural 
lands. The program strategy allocates $3 million for acquisition and 
perpetual maintenance of species reserve areas. With this type of 
protection, farmers would no longer have to be concerned about 
endangered species act violations when fallow land is reused.
Oil development issue
    A mitigation strategy has been devised that is intended to 
acknowledge existing oil field activities within Kern County. The 
strategy proposes to acquire 3,000 acres of endangered species habitat 
to mitigate for species loss resulting from oil field development 
outside of established oil field production areas, but within proximity 
of those areas. This is to allow for reasonable expansion of oil field 
activities over the life of the HCP program. The program strategy 
allocates $3 million for acquisition and perpetual maintenance of 
species reserve areas. With this type of strategy, oil field expansion 
activities would be provided for in the program. This strategy would be 
of great benefit to the small independent oil and gas companies within 
the program area.
    Together the $6 million required for the agriculture and oil field 
strategies would provide a method to satisfy the program's conservation 
goals, while also providing for continued economic growth of Kern 
County's oil and agricultural industries.
    Numerous industries, in concert with the State of California and 
local government entities, are attempting to do their part, and we come 
to the appropriations process to request assistance in obtaining a fair 
federal share of financial support for this important effort. This 
unique cooperative partnership involving state and local government, as 
well as private industry, has contributed substantial funds to date to 
assist in the development of this program.
    The California Industry and Government Coalition appreciates the 
Subcommittee's consideration of this request for a fiscal year 1998 
appropriation to support implementation of this significant program.
                                 ______
                                 

    Prepared Statement of Mary Beth Beetham, Legislative Associate, 
                         Defenders of Wildlife

    Mr. Chairman and Members of the Subcommittee: I am Mary Beth 
Beetham, Legislative Associate for Defenders of Wildlife. On behalf of 
Defenders and our nearly 200,000 members and supporters, I thank you 
for the opportunity to provide testimony concerning our fiscal year 
1998 appropriations priorities. America's greatness and wealth flow in 
large measure from the abundance and diversity of our magnificent 
natural resources. As unprotected natural areas continue to disappear, 
our public lands and public trust resources are increasingly important 
in maintaining our nation's natural resource base and numerous 
attendant benefits to society. Yet ironically, at the same time that 
these irreplaceable publicly-held natural assets increase in value to 
our nation, their continued vitality is threatened by the prospect of 
funding cuts as Congress and the President move to balance the budget. 
Increasingly, people across America are realizing the looming peril to 
these vital assets and are uniting to support funding for our federal 
conservation programs. Defenders is a member of many of these 
coalitions which will be referenced throughout our testimony.
    The largest and most encompassing coalition is the Public Lands 
Funding Initiative (PLFI) which advocates modest increments to the 
Interior Appropriations Subcommittee's 602(b) allocation over the next 
six years to support key public lands and wildlife accounts. 
Recommendations of the PLFI will be presented into the record later 
today by The Wilderness Society. This coalition consists of 150 
environmental, recreation and conservation groups and is endorsed by 
Theodore Roosevelt IV, great-grandson of the President.
    As an investment banker, Mr. Roosevelt understands the wisdom of 
essential investments, as illustrated in his letter endorsing the 
initiative: ``Given the overwhelming importance of these resources to 
present and future generations of Americans, the only fiscally 
responsible course is to invest adequately in their stewardship and 
management, even as we take needed steps to balance the federal budget. 
Indeed, denying critically needed funding is fiscally irresponsible and 
shortsighted--the neglect caused by deficient funding will result in 
destruction and degradation of these valuable assets that is far more 
costly in the long run than providing funds to properly care for them 
today.''
                          species conservation
    Endangered species.--Defenders is working with the Endangered 
Species Coalition, a broad base of national and local organizations 
committed to the conservation of threatened and endangered species, to 
increase funding for Endangered Species Act implementation. For Fish 
and Wildlife Service's (FWS) four main Endangered Species accounts 
(Candidate Conservation, Listing, Recovery, and Consultation), we urge 
at the very least the amounts requested in the President's fiscal year 
1998 budget ($78.781 million), but believe that increases over the 
request are both necessary and appropriate. Adequate funding benefits 
interests on all sides of the ESA debate because it allows for smooth 
implementation and speedy less-costly recovery, reducing the potential 
for conflict.
    Under the President's budget, Candidate Conservation and Listing 
would be virtually level-funded even though the FWS anticipates 
increases of 23 percent in Candidate Conservation activities and 30 
percent in Listing actions in fiscal year 1998. According to FWS, the 
Listing program, which would be funded at only half of the Bush 
Administration's fiscal year 1992 request level, is still suffering a 
backlog due to the fiscal year 1995-96 listing moratorium. The Service 
has already missed a statutory deadline for actions on 146 species 
currently proposed for listing and many of the 184 candidates needing 
listing proposals. One such candidate is the disappearing Florida black 
bear, waiting along with 84 other species since a 1992 court settlement 
for a finding under the Act. FWS has also indicated that it will not 
designate any critical habitat (funded by the Listing account) during 
fiscal year 1998.
    The marginal increase requested for Recovery will not adequately 
address the backlogged 299 listed species lacking recovery plans and 
planning for the additional 120 species projected for listing in fiscal 
year 1998, while still allowing for recovery implementation. Based on a 
1990 Audit Report on the ESA program by the Department of Interior's 
(DOI) Inspector General (Report 90-98), the lower-end estimate for 
average yearly recovery cost per species was $100,000. This would 
result in a total fiscal year 1998 need of $96 million to fund recovery 
for the more than 960 listed U.S. species under FWS jurisdiction. As 
can be seen from the projected fiscal year 1998 costs of recovery for 
keystone species listed below, $100,000 per species is indeed a 
conservative estimate.
    Although a 34 percent increase was requested for Consultation, the 
FWS expects to be involved in approximately 43 percent more Section 7 
Consultations and Section 10 Habitat Conservation Plans. Moreover, the 
Service has also just begun to identify the need for monitoring and 
follow-up on these activities, but until now has had no funds to do so. 
Consequently, Defenders supports increases in this item and opposes the 
$85,000 reduction in the Section 6 Cooperative Endangered Species Fund, 
the only ESA related program that directly supports State activities.
    Defenders' highest priorities for recovery programs focus on 
keystone species whose restoration fosters recovery of supporting 
ecosystems and associated species. The Mexican wolf, extinct in the 
wild and unrepresented in any extant populations of gray wolves, is the 
rarest subspecies of gray wolf in the world. For captive propagation, 
public education, and initiation of reintroduction efforts to re-
establish and maintain viable wild populations, $546,600 (FWS) is 
needed for fiscal year 1998. For the successful red wolf program in 
North Carolina and Tennessee, $1,025,000 (FWS) will support continued 
captive propagation, monitoring, and releases. The landmark Northern 
Rockies wolf recovery program, continues to enjoy tremendous success, 
and no further reintroductions are anticipated at this time. For 
monitoring, public education, and cooperative agreements with the Nez 
Perce tribe and states (which will receive most of the FWS allocation) 
$975,000 (FWS) is needed, while $300,000 (NPS) is needed for management 
of the program in Yellowstone National Park. In addition, we urge the 
Subcommittee to allocate $50,000 (FWS/NPS) to study the suitability of 
Washington's Olympic National Park for Gray wolf restoration. At least 
$480,000 (FWS) is necessary for recovery efforts in Wyoming, Montana, 
S. Dakota, and Arizona for the endangered black-footed ferret, thought 
to be extinct in the wild except for reintroduced populations. Of this 
amount, $230,000 will continue the crucial FWS role as coordinator in 
this multi-partner program that leverages three to four non-federal 
dollars for every federal dollar. The additional $250,000 is essential 
to fund management of the former Sybille breeding facility (now the 
National Black-footed Ferret Conservation Center), home to 60 percent 
of the captive breeding population and formerly run by the State of 
Wyoming. Finally, the grizzly bear recovery program is a successful 
cooperative effort between federal, state, and local governments and 
private landowners that is being eroded by budgetary reductions. 
Moreover, the grizzly program is cost effective, resulting in multi-
species benefits to black bears, wolverines, lynx and mountain lions; 
$800,000 is needed in fiscal year 1997 for the grizzly recovery program 
which covers 30,000 square miles in four states. Successful 
reintroduction of threatened grizzly bears into the Bitterroot 
ecosystem of central Idaho and W. Montana could increase grizzly bear 
numbers and range in the lower 48 states by nearly one third; $250,000 
of the grizzly recovery budget will be will be used for initiation of 
reintroductions.
    Other FWS accounts: Defenders also wishes to underscore its support 
for no less than the President's budget request for other FWS accounts 
critical to species conservation: Law Enforcement; Migratory Bird 
Management, especially for conservation of non-game birds; 
International Affairs, which helps support U.S. international 
leadership in the conservation of wildlife and biodiversity, 
particularly through implementation of the Convention on International 
Trade in Endangered Species; and the modestly funded African Elephant 
and Rhino and Tiger Conservation Funds.
                              public lands
    Land and Water Conservation Fund (LWCF).--The LWCF represents a 
promise made by Congress to the American people to reinvest revenue 
from the development of non-renewable resources into acquisition and 
permanent protection of key land, water, and open space resources for 
future generations. Although authorized at $900 million per year and 
the primary source of revenues, offshore oil and gas leases, average 
more than $2 billion yearly, fiscal year 1996 and fiscal year 1997 
allocations are the lowest in 25 years (about 15 percent of the 
authorized level). Moreover, according to DOI budget information, Outer 
Continental Shelf receipts totalled about $4 billion in fiscal year 
1997 and are expected to be about the same for fiscal year 1998.
    Defenders is proud to be a leader in Americans for Our Heritage and 
Recreation (AHR), a new coalition dedicated to revitalizing and 
potentially expanding the LWCF. AHR represents thousands of LWCF 
stakeholders nationwide including urban, state, recreation, industry, 
and environmental groups. Defenders urges this subcommittee to renew 
the broken promise of the LWCF Act by fully funding the AHR's modest 
fiscal year 1998 federal project list.
    Defenders' priority for such funding is the acquisition of lands to 
protect threatened and endangered species, conserve biodiversity, and 
consolidate protection of key ecosystems, such as the Pinhook Swamp, a 
corridor linkage between Northwest Florida's Osceola National Forest 
and Georgia's Okeefenokee National Wildlife Refuge. Slated to be 
acquired and managed by the Forest Service, the linkage would complete 
a large, regionally significant conservation area providing a 
stronghold for wide-ranging species such as the Florida black bear and 
habitat for the federally endangered Florida panther, woodstork, and 
red-cockaded woodpecker.
    National Wildlife Refuge System (NWRS) Operations and 
Maintenance.--The 92 million acre NWRS is the only federal lands 
network dedicated primarily to fish and wildlife conservation, serving 
as an anchor for protection of our nation's magnificent biodiversity. 
While the primary purpose of the Refuge System is conservation, it also 
serves more than 28 million recreationists yearly, engaging in 
compatible activities such as wildlife observation, hiking, and 
fishing, generating hundreds of millions in economic benefits to local 
communities.
    Unfortunately, the NWRS continues to be a jewel in the rough, 
crippled for years by severe funding shortfalls resulting in a current 
Maintenance backlog of approximately $428 million and Operations needs 
of approximately $300 million. The National Fish and Wildlife 
Foundation's fiscal year 1997 Fisheries and Wildlife Assessment 
highlighted the Refuge O&M funding shortfall as a key policy issue for 
DOI, pointing out that the Refuge System receives the lowest per-acre 
funding of all federal land management agencies.
    As a proactive member of the Cooperative Alliance for Refuge 
Enhancement (CARE), a diverse coalition of more than 15 environmental, 
hunting, fishing and recreation groups formed in 1995 to address the 
severe Refuge funding problems, Defenders fully endorses testimony 
presented on behalf of CARE by Dr. Rollin Sparrowe. CARE is currently 
finalizing a proposal which would recommend increases of approximately 
$50 million per year for the next six years, to bring the Refuge System 
to two-thirds of its capacity by the year 2003. For fiscal year 1998, 
we are requesting $220 million, $28 million more than the President's 
request and have worked with the FWS to identify a list of specific 
projects totalling $35 million that will not be funded even if the 
President's budget is allocated, such as: National Key Deer Refuge 
(FL), population survey of backcountry islands for the endangered key 
deer and completion of GIS mapping to assist in key deer management; 
Lower Suwannee NWR (FL), aerial surveys for the endangered manatee; 
Alligator River NWR (NC), hiring of a full-time law enforcement 
officer. We appreciate the Subcommittee's fiscal year 1997 funding 
increase and urge allocation of CARE's recommended $220 million for 
fiscal year 1998.
    USDA Forest Service (FS)--The 192 million acre National Forest 
System (NFS) supports the greatest diversity of plant and animal 
species on any public lands systems nationwide--more than 3000 species 
of wildlife and 10,000 species of plants, of which 33 percent are 
federally listed species and 2,500 identified as sensitive. Viewing of 
wildlife is the fastest growing use on the NFS, generating 33 million 
activity days and supporting 55,000 jobs valued at $1.6 billion 
(Resources Planning Act 1995 Draft Program). To support these important 
uses, the PLFI recommends funding increases for NFS Fish and Wildlife, 
Ecosystem Research, Recreation, and Trails.
    Defenders is particularly concerned about funding for NFS Fish and 
Wildlife Habitat Management and recommends at minimum the President's 
request of an $11 million increase (still lower than fiscal year 1991-
95 levels), including a $5.45 million increase for Threatened, 
Endangered, and Sensitive Species (TES). Moreover, the FS has 
identified $68 million in opportunities for TES, more than twice the 
requested funding level, including projects such as improved protection 
for the endangered Hualapai Mexican vole on the Prescott National 
Forest and for grizzly bear, wolverine, and North American lynx on 
Washington's Okanogan National Forest. While Defenders is working 
aggressively to support an increase in the Subcommittee's 602(b) 
allocations to fund needs for programs of concern, we also support 
efforts by the Green Scissors Coalition and the Western Ancient Forest 
Campaign to examine and restore Forest Service accountability--called 
into question by the GAO and the White House Council of Economic 
Advisors--as a way of generating at least some offsets for necessary 
increases. To this end, we recommend reform or abolishment of permanent 
funds such as Salvage and K-V and elimination of below-cost timber 
sales. As a first step in addressing below-cost sales, we are pleased 
with the Administration's proposal to end the Purchaser Credit Program 
(PCP) but are concerned that 84 percent of the funds used to support 
the PCP and Purchaser Elect Program are still included in the 
President's budget. In addition, Defenders believes that any funding 
for road-building in roadless areas should be eliminated. The 
Administration has also proposed creation of a new Forest Ecosystem 
Restoration and Maintenance Fund. While we support the goals of this 
fund, we are awaiting details and are concerned about the creation of 
any new off-budget FS fund as well as some of the activities currently 
proposed for the fund that could create new incentives for FS managers 
to log to raise revenue.
    Bureau of Land Management (BLM).--While the NFS supports the 
largest diversity of species, according to BLM the 264 million acres of 
public domain lands support the most ecologically varied land base. 
Based on agency information, fish and wildlife are the most important 
economic resources on these lands, generating 66 million visitor days 
and $2.5 billion in economic benefits. The PLFI supports increased 
funding for BLM Wildlife and Fisheries, Wilderness, Cultural Resources, 
Recreation, and Riparian Restoration and Protection. A priority for 
Defenders is Wildlife and Fisheries, especially Threatened and 
Endangered (T/E) species and we recommend increases over the virtual 
level funding recommended in the President's budget for both of these 
accounts. The number of threatened and endangered species on BLM lands 
has increased in recent years at the rate of about 20 per year. Even 
though BLM lands will provide habitat in fiscal year 1998 for more than 
300 listed or proposed plants and animals, fiscal year 1998 requested 
funding would support actions for just a little more than half of these 
species. Based on this figure the T/E level should be almost doubled to 
about $30 million.
    National Park System (NPS).--As a member of the Everglades 
Coalition, Defenders supports the President's budget request of $100 
million for the Everglades Restoration Fund. This fund is critically 
needed for land acquisition, modified water delivery and research to 
reverse damages inflicted over the past 100 years to the South Florida 
Ecosystem. This magnificent area is home to 6 million people and 68 
listed species and provides wintering habitat for more than 129 bird 
species and breeding habitat for an additional 132 bird species.
                          scientific research
    USGS Biological Resources Division (BRD).--The continued existence 
and well-being of our nation's vast array of biological resources is 
dependent on informed and considered conservation and management. 
Rigorous scientific research of a long-term nature is absolutely 
critical to developing effective conservation strategies, determining 
the best available management plans, and reducing conflict over 
dwindling resources. The relocation of DOI's biological science 
capabilities to USGS offers significant potential for a truly 
interdisciplinary science agency capable of providing this type of 
integrated research. While we understand that the land management 
agencies have voiced concerns that their research needs are not being 
adequately addressed by BRD, we suggest that to the extent this is the 
case, a significant factor may be the funding cuts inflicted on these 
activities over the last two years--more than 15 percent below fiscal 
year 1995 levels for both fiscal year 1996 and fiscal year 1997. We 
urge, at the very least, full funding of the President's request ($145 
million), but note this amount would still leave the Division with 
almost a 14 percent funding reduction below fiscal year 1995 levels. 
Defenders is a member of a new group of organizations (BRD Watchers) 
which supports enhancement of DOI's biological research programs.
    Defenders maintains its support for the Gap Analysis Program (GAP), 
a collaborative effort involving 40 states and more than 400 business, 
non-profit, local, and Federal agency organizations to map our nation's 
biological diversity and areas currently managed for its protection. We 
also continue to believe that insufficient resources have been made 
available for efficient transfer of GAP data to users and integration 
into on-the-ground conservation planning. We recommend that specific 
funding be earmarked for GAP product development and pilot projects 
using GAP for statewide and bioregional conservation planning. Thank 
you, Mr. Chairman.
                                 ______
                                 

Prepared Statement of John E. Ebel, Director, the Weston Observatory of 
                             Boston College

    Mr. Chairman and members of the Subcommittee, I appreciate this 
opportunity to submit testimony regarding the importance of the 
National Earthquake Hazard Reduction Program (NEHRP) in the United 
States. As the Director of the Weston Observatory of Boston College, I 
want to bring to your attention how NEHRP funding has positively 
impacted Weston Observatory's efforts to stimulate earthquake hazard 
reduction activity in the northeastern United States and how future 
funding is vital if such efforts are to be successfully continued.
    Let me say up front that increased NEHRP funding is essential if 
efforts to mitigate the effects of future earthquakes in the 
northeastern U.S., as well as in the earthquake prone areas in the rest 
of the country, are to be successful. NEHRP funding for the U.S. 
Geological Survey (USGS) needs to be increased to $52 million for 
fiscal year 1998. Of this almost $4 million increase over the USGS 
fiscal year 1997 appropriation, I urge that $2 million of the increase 
be dedicated to improving the earthquake monitoring capabilities across 
the U.S. As I will explain below, prolonged level funding and recent 
budget cuts are severely hampering the current ability of scientists to 
collect data on earthquake occurrences and their effects. NEHRP cuts 
also are adversely impacting the ability of USGS and university 
scientists to analyze these data and to translate their research 
results into public mitigation efforts. In my remarks, I will focus on 
efforts and results of earthquake research in New England and vicinity. 
However, I know from discussions that my colleagues from throughout the 
U.S. are facing the same problems that I face here in the northeast.
    From the days of the Pilgrims right to the present, earthquakes 
have been a part of life in New England. While many strong earthquakes 
in the past have caused damage in the region, in modern times New 
England so far has been lucky that none of its major cities has taken a 
direct hit from a strong earthquake. However, just in the northeastern 
U.S. itself earthquakes in the past few years near Boston, Providence, 
Hartford, New York City and Philadelphia are evidence that at some time 
in the future any of these cities could experience a catastrophe 
similar to that in Northridge, California in 1994. Earthquake awareness 
in this region is slowly increasing, as have mitigation efforts. During 
the past few years, for instance, New York City adopted a seismic 
provision in its building code, and Massachusetts began requiring older 
buildings be refurbished to earthquake resistant standards. Other New 
England states have begun adopting the recommended seismic provisions 
for new buildings from the national building code organizations. 
However, too many members of the general public view these requirements 
as legal impediments to be avoided rather than safety issues that must 
be undertaken. This is especially true for those who own the older 
buildings that are most prone to damage in earthquake shaking. I hope 
someday to see those who design, construct and refurbish buildings take 
earthquake design as seriously as they take fire safety design. 
Unfortunately we still have a long way to go to get there.
    It is my firm belief that earthquake monitoring and research is a 
key aspect necessary to motivate the public to take the earthquake 
threat seriously. Scientists of all disciplines know that publicity 
surrounding new research discoveries and observations can be a prime 
force motivating people to take action. This has certainly been true in 
such areas as cancer studies, global climate change research and 
environmental impacts on the earth's ozone layer. It is also quite true 
in earthquake studies. For example, during the spring of 1996 several 
small earthquakes were felt in eastern Massachusetts. Not only did 
people want to know from the Weston Observatory staff the magnitudes 
and locations of these events, but also they wanted to know if these 
shocks meant that a stronger earthquake could occur. We at Weston 
Observatory responded that we could not predict the occurrences of 
future earthquakes but that small earthquakes do indicate places where 
stronger events could be centered in the future. I have had many people 
thank me for studying these earthquakes and express the hope that the 
studies would lead to new discoveries in the future.
    Other work by Weston Observatory researchers have added to the 
understanding of the earthquake threat in the northeast. For example, 
some of my research indicated that in 1638 an earthquake of Richter 
magnitude 6.5 to 7.0 (probably comparable to those recently at Loma 
Prieta, California in 1989, Northridge, California in 1994, and Kobe, 
Japan in 1995) took place in New England, with the most likely place 
for the epicenter being central New Hampshire. Today, central New 
Hampshire is the most seismically active zone in New England. In 1996, 
I and two other Weston Observatory researchers released the first 
seismic hazard study of the state of Vermont. Research by Prof. Alan 
Kafka of Boston College has shown that the persistent earthquake 
activity in the New York City area is similar to that in other areas 
where strong earthquakes can occur. We are still looking to identify 
which are the active faults throughout the region, but recent 
earthquake monitoring has allowed us to guess which geologic faults 
bear further study.
    Unfortunately, if current funding trends continue, it will be 
difficult to maintain this level of research activity in the future. 
NEHRP funding to the USGS has decreased in the past two years after 
several years of level funding. This has translated into cuts in the 
funding that Weston Observatory receives for earthquake monitoring in 
New England. We have responded to these cuts by paring down the staff 
operating the seismic network and by delaying installation and 
maintenance of our 15 seismic stations spread strategically across the 
six New England states. Under the current-year funding for Weston 
Observatory, later this year I will no longer be able to afford my 
part-time seismologist who is the one who carries out the routine 
analysis on the earthquake data we record. By the end of 1997 Weston 
Observatory could be in a situation where it is recording earthquake 
data but has no one to analyze it on a routine basis. Not only does 
this represent a loss of vital scientific data, but it also severely 
hampers our efforts to increase the speed and improve the quality of 
the earthquake information that we deliver to the public.
    I know that other seismic networks across our country are faced 
with this same kind of staffing problem due to budget cuts. It is for 
this reason that I call for $2 million additional funding for 
earthquake monitoring throughout the U.S. That amount of money, spread 
across the 15 or so earthquake networks across the country, would go a 
long way alleviating the current crisis in the operation of our 
national earthquake monitoring infrastructure. Over the longer term, 
Congress should consider special appropriations of a few million 
dollars to improve earthquake monitoring all throughout the country. 
Such an investment is necessary if regional seismic networks are to 
deliver earthquake epicenters, magnitudes, ground motions, and 
estimates of damage within seconds or minutes of the occurrence of an 
earthquake. It is also necessary if such proposals as earthquake early 
warning systems are to be developed.
    I believe that increased NEHRP funding to the USGS for basic 
earthquake research can have a number of benefits for earthquake hazard 
reduction efforts, both within New England and nationally. I list some 
of the most important research benefits here:
    (1) Improve our understanding of the causes, effects and 
probabilities of strong earthquakes. Earthquakes are a natural hazard 
that arise from deep inside the earth, a place that can only be studied 
by instrumentation placed at the earth's surface. While research over 
the past two decades has revealed why many strong earthquakes have 
occurred, many other earthquakes have been surprises to scientists. All 
across the country, we still have much to learn about which faults are 
active, how often damaging earthquakes may take place on those faults, 
and under what geologic conditions strong earthquakes can occur. For 
example, in New England all of the faults are geologically old 
(hundreds of millions of years old). Most are probably seismically 
dead, but some must be active because we have earthquake activity. 
Unfortunately, we do not have enough seismological and geological 
evidence to determine which of the local faults are seismically active. 
I feel certain that the identification of one or more active faults 
would catch the public's attention and spur earthquake mitigation 
measures.
    (2) Improve the speed and quality of earthquake information to the 
public and to government officials. The tremendous increase in the 
availability and speed of communications during the past few years has 
raised the expectations of the public with regard to how fast they 
expect to receive information immediately following the occurrence of 
an earthquake. The delivery of emergency services and decisions about 
repairing or restoring vital lifelines rely heavily upon the speed and 
accuracy of the earthquake information available. The development of 
systems to rapidly deliver earthquake information, ideally during or 
even before the earthquake shaking is experienced, is a goal that 
demands new resources over those currently allocated for NEHRP 
research.
    (3) Improve the understanding of those parts of our urban areas 
that are most prone to damaging earthquake shaking. Earthquakes such as 
those that affected Mexico City in 1985, San Francisco and Oakland in 
1989, and Kobe in 1995 have driven home the point that landfill and 
other thick soil areas within cities are prone to amplify earthquake 
shaking and hence are most prone to earthquake damage. There should be 
a major research effort to identify such dangerous zones within all 
cities in our country that lie in areas with moderate or high seismic 
hazard. In New England, Boston, Providence, Hartford and Portland, 
Maine all qualify as cities that have local zones where earthquake 
ground shaking will probably be amplified.
    (4) Develop programs to encourage industry to undertake earthquake 
mitigation efforts. In my opinion, industry needs to be encouraged to 
invest in earthquake hazard research and mitigation. With the recent 
trends to allow regional or national banks, utilities and 
communications, an earthquake catastrophe in one part of the country 
could inadvertently impact other parts of the country as well. Such 
widespread impacts often are not appreciated when mergers or takeovers 
take place. Studies to learn the national effects of damaging 
earthquakes in different parts of the country should be something in 
which both industry and government regulators take interest.
    There is a tendency among some in public and private circles to 
dismiss basic research, especially long-term research, as not meeting 
the needs of the nation. In fact, I believe that just the opposite is 
true. The current success of earthquake hazard mitigation efforts stems 
in large part from the past basic research that has been funded by the 
federal government. This is especially true of seismic monitoring of 
small earthquakes. To the public, such monitoring indicates that the 
earthquake threat is real and should be taken seriously. To the 
scientist, such monitoring provides the basic information upon which 
new theories and discoveries must be based. We are still at the point 
where each earthquake provides a new piece of information to help us 
decipher the puzzle of where and when future strong earthquakes may 
occur. There is no doubt that future efforts by the public to take 
action to mitigate the effects of earthquakes will be directly related 
to the amount of basic research that takes place now and in the near 
future. This is true in New England and throughout the rest of the 
country as well.
                                 ______
                                 

      Prepared Statement of the Interstate Council on Water Policy

    The Interstate Council on Water Policy (ICWP) represents state, 
regional and local water resource management agencies throughout the 
country. Since 1959, the Council has voiced the concerns of local and 
state managers regarding federal programs and activities. It is in this 
role that the Council wishes to express comments on the 
Administration's proposed budget for Federal fiscal year 1998 for the 
U.S. Geological Survey (USGS).
    The Council is pleased to see the fiscal year 1998 budget for USGS 
remains at funding levels seen in fiscal year 1996 and 1997. The Water 
Resources Division comprises 26 percent of that budget and also sees an 
increase in funding over 1997. That increase stems from adaptation of 
the National Water Quality Assessment Program (NAWQA) to support 
President Clinton's ``Water Quality Information (Kalamazoo) 
Initiative'', providing water quality information on the major streams 
and aquifers in the Nation's 75 largest metropolitan areas, including 
the largest city in each of the 50 States.
    This $9 million increase in NAWQA funding appears to require $1.9 
million in new appropriation, with the balance coming from redirected 
funds of eliminated or reduced programs, such as the Acid Rain and the 
Water Resources Assessment Programs. The Council is concerned this new 
Initiative deviates from the original premise of Hydrologic Unit-based 
sampling which underlies the NAWQA approach and supports the ongoing 
implementation of the NAWQA Program. Directing investigations toward 
water resources in metropolitan areas appears to step away from the 
reigning philosophy of watershed oriented management and assessment 
which USGS has championed.
    The Council believes much of the monitoring information sought by 
this new Initiative is already available from State and local water 
agencies and questions whether resources directed into the President's 
Water Quality Information Initiative comes at the expense of other 
endeavors which provide the States with useful and needed information, 
such as stream gaging stations and new NAWQA study units. An 
examination of the new directions of the NAWQA Program would seem 
warranted in order to ensure the most pertinent and valuable water 
quality data are collected.
    The Council is extremely concerned by the disturbing effect that 
funding reductions and inflation are having on federal data collection 
efforts, under the heading of Water Data Collection and Management. We 
note that the portion of the stream gaging network supported by the 
federal funds was decreased by $1.1 million in fiscal year 1997 and 
that there is no restoration of these funds or compensation for 
inflation in the fiscal year 1998 budget. This combination of factors 
will result in a loss of more than 100 gaging stations, further 
accelerating the losing trend which began in 1990.
    A similar situation arises in the Federal-State Cooperative 
Program, which stands to lose $1.2 million from 1997 funding levels. 
This decrease follows a $2.4 million increase in funding between 1996 
and 1997, which offset inflationary costs of the existing program. The 
``roller-coaster'' approach to funding directly influences nonfederal 
agency decisions to provide matching funds to begin investigative 
studies and monitor additional streams.
    This budgetary method provides no stability to maintaining a 
program which is the foundation of partnership between the federal 
government and state and local agencies. Under the requested level, an 
additional 120 gaging stations funded through the Federal-State 
Cooperative Water program will be discontinued, further diminishing our 
ability to monitor and assess the dynamic trends of our Nation's stream 
systems. Reductions in this program also negate opportunities for the 
federal government to leverage its investment with contributions from 
state and local users.
    The ICWP and USGS have been engaged in a dialogue of trying to 
provide guidance on modification of the Nation's stream gaging network 
given limitations in future funding. The nationwide network comprises 
both the federal program and the Federal-State Cooperative Program. 
There are selection criteria to be considered when deciding the fate of 
a given station. These criteria include monitoring of unique hydrologic 
areas, monitoring compliance for interstate compacts and Supreme Court 
decrees and adequate coverage for National Weather Service flood 
forecasting. The ICWP and USGS are working toward consensus on those 
criteria, but the Council fears that adoption of the fiscal year 1998 
budget will pre-emptany further discussion on the configuration of the 
Nation's streamflow monitoring network, as the Survey hastens to 
discontinue stations to meet its funding constraints.
    The Council appreciates and supports the Administration's and 
Congress' need to reduce the Federal Budget. We are concerned that in 
the process of downsizing federal commitments for water resource data 
collection, the States shoulder the burden of compensating for the 
smaller network. Adjustments can be made by all levels of government, 
but it must be allowed to occur in an orderly process so that any 
necessary transitions in responsibility minimize disruption to the 
access of important information.
    The Council reiterates that the collection of water resource data 
remains the highest priority and retains the highest value of our 
relationship with the USGS. Changes in emphasis from data collection to 
hydrologic analysis provide marginal value to the states in situations 
when resources are redirected from data programs to new initiatives. 
The cornerstone of a local-state-federal partnership in water remains 
the availability of reliable water resource data on which to base 
decisions and coordinate activities.
    In that spirit, the Council requests Congress to minimize any 
reductions in the fiscal year 1998 appropriations to the federal 
Hydrologic Networks and Analysis and the Federal-State Cooperative 
Programs to maintain the delivery of useful hydrologic information and 
to allow ICWP and USGS to prepare a plan for a necessary yet smooth 
transition in data collection support efforts in fiscal year 1999.
                                 ______
                                 

   Prepared Statement of Dr. Thomas G. Bahr, President, the National 
                     Institutes for Water Resources

    Mr. Chairman: My name is Thomas G. Bahr. I am President of the 
National Institutes for Water Resources and Director of the New Mexico 
Water Resources Research Institute at New Mexico State University, Las 
Cruces, NM. I wish to thank you for the opportunity to provide 
testimony and express my appreciation for the strong support you have 
given the Water Resources Institute program. I have been directly 
associated with this program for over 20 years as a director of two 
different state institutes and also as the director of the federal 
agency which once administered this program during the first Reagan 
administration. This is a valuable program for America which recognizes 
the premise that states, not the federal government, are the managers 
of their water resources and that solutions to water problems are best 
solved at the state and local level. Water Resources Research 
Institutes are state entities, which through applied research, are 
ideally situated to tailor appropriate solutions to state water 
problems. States, in fact, put two dollars into the Institute program 
for every one federal dollar.
    I am pleased to report that the Water Resources Research Act was 
reauthorized by the Congress and signed into law on May 24, 1996. This 
Act (42 USC 10301 et seq.) continues the important state-based program 
originally authorized in 1964. As my colleague, Dr. Leland Mink, points 
out in his testimony, the Act has been broadened to include emphasis on 
long-range water resources planning and the study of effective 
management of agricultural and natural resources systems. This adds 
important new dimensions to the program making it an even more 
comprehensive and robust authorization. Its implementation, however, 
depends on adequate funding.
    We have reviewed the USGS budget proposed by the Administration and 
we strongly support the research program of the Water Resources 
Division. Their work is widely recognized as first class among the 
scientific community. For the first time in several years, the 
Administration has now recommended at least some funding for the Water 
Resources Research Institute program and we greatly appreciate this as 
a step in the right direction. Over the many years of the Institute 
program, however, there has been a steady erosion in the ability of 
Institutes to maintain viable programs. Last year's funding level of 
$4.553 million is roughly the same amount as the first year 
appropriation for the program when it started over 30 years ago. 
Inflation over the past 30 years, however, has reduced the purchasing 
power of the research dollar by nearly 4-fold.
    On behalf of the National Institutes for Water Resources we ask for 
your support for the following:
    $7,000,000 to support activities authorized by Section 104(b) of 
the Water Resources Research Act, that section which authorizes the 
base institutional grants for the 54 state Water Resources Research 
Institutes.
    $2,000,000 to support activities authorized by section 104(g) of 
the Water Resources Research Act, that section which authorizes 
regional, multi-state and interjurisdictional research.
    $250,000 to support U.S. Geological Survey for administration of 
this program.
    We recognize the serious federal budget constraints at this time 
and fully understand the need for the federal government to be more 
productive with limited resources. It is for this reason we feel the 
documented productivity of the Water Resources Research Institutes 
program, the importance of the program to the individual states and the 
modest federal appropriation, essential in maintaining the high degree 
of productivity, amply justifies our request.
section 104(b)--institutional grants to the 54 institutes. what are the 
                               benefits?
The Institute program assures that all states maintain the capability 
        and expertise needed to solve their own water resources 
        problems
    The Water Resources Research Institutes use state scientists to 
conduct high priority state, regional and national research on water 
resources which can effectively reduce the size and cost of the federal 
role. The Institutes provide an existing research infrastructure by 
connecting and integrating the university-based water research 
capabilities. State agencies which are charged with direct management 
responsibilities need--but often do not have--such research 
capabilities. The Institute oversight and advisory committees, 
consisting of state and local of finials and members of the public, 
provide direction to each institute and serve at no cost to the federal 
government.
    Federal support for the Institute program creates a national 
network among the states and between their land grant colleges and 
universities and other research institutions. The network links water 
investigators throughout the nation, thereby eliminating research 
duplication and ensuring high priority topics are addressed. The 
federal support and interest in this program is an essential component 
in the Institute's ability to secure non-federal funds to support 
additional water research and technology transfer and educational 
activities. During the last fiscal year, Institutes leveraged 11 non-
federal dollars for every 1 federal dollar appropriated to this 
program!
Separation of governmental regulatory functions from the research 
        process is essential
    Most federal water management agencies have regulatory 
responsibilities. ``In-house'' research among these agencies is more 
susceptible to political pressure to generate conclusions in support of 
an agency's position, than is independent scientific research and 
technology development conducted at our nation's universities.
The federal water problem-solving role could be significantly reduced 
        and transferred to the states
    Federal regulations and programs designed to solve water problems 
have their primary impact at the state and local level. State and local 
governments are in a far better position to tailor solutions to local 
water problems. Significant reductions of many ``in-house'' federal 
water research programs could be achieved, while at the same time 
preserving the capacity to conduct research, transfer information, and 
solve water problems through the Water Resources Research Institute 
program.
The nation's future depends on a continuing stream of qualified 
        engineers, scientists and policy makers, and requires that 
        these people be trained to address more complex water issues
    Training of water resource professionals has been a hallmark of the 
programs conducted by the Institutes. Not only does this program 
provide an opportunity to expand the number of students trained, it 
will more importantly offer training that provides the kinds of skills 
needed by many future water resource professionals. Funding this 
program would help ensure that this country develops enough personnel 
to deal effectively with the more complex problems of water management 
and water quality in the future. Unlike federal research agencies, 
virtually every research dollar spent on this program has the important 
added benefit of supporting the training of new scientists and 
engineers.
section 104(g) regional and interjurisdictional research--what are the 
                               benefits?
    By authorizing the Section 104(g) program, Congress recognizes that 
water resources management is undergoing changes in the United States 
and many serious water problems are regional and interjurisdictional in 
scope. The information necessary to solve these problems must be 
generated by knowledgeable organizations with a familiarity and 
understanding of these interjurisdictional dimensions. The nation's 
universities have the interdisciplinary expertise needed to help solve 
such complex problems without the addition of more federal employees.
Federal funds are necessary to create a base of support for research on 
        regional interjurisdictional problems
    Without federal support, there are virtually no sources of funds 
available to support the scale of interdisciplinary research and 
analysis necessary for assessing regional and interstate water 
resources problems. It is wholly appropriate for the federal government 
to provide the support base and serve as a catalyst for the type of 
solution-oriented, problem-solving research toward which this program 
would be directed through our nation's universities.
The research and networking capabilities of the Water Resources 
        Research Institutes are well-suited to lead multi-and 
        interdisciplinary programs aimed at providing solutions to 
        complex water issues
    The record of the Institute program in carrying out its mission 
under the Water Resources Research Act has been well documented and is 
further described in the 1997 Executive Summary of our program provided 
to your committee. The Institutes can provide not only the technical 
expertise needed to offer solutions, but can serve as the point of 
contact to recognize and bring together concerns of all the 
participating parties across the relevant jurisdictions.
           regional competitive program as currently mandated
    Guided by language in the fiscal year 1996 conference committee 
report (House Report 104-259, pp. 33-34) the USGS and Institutes 
implemented a different mechanism to allocate Section 104(b) 
institutional grant funds. Last year, a base grant of $20,000 was 
provided to each of the 54 Institutes and the balance of the funding 
was equally divided into four regional pools. Research priorities 
focusing on regional problems of each of the four regions were 
established and circulated among potential research investigators 
within each of the respective regions. Institutes within each of the 
regions then applied for research project funding on a competitive 
basis.
    Having now gone through this new process one time, it is clear to 
us that it is not a very cost effective mechanism for allocating 
funding and it is extremely cumbersome to administer. Projects selected 
for funding were of very high quality, but no better than projects 
which had been selected under the former system of making competitive 
awards in each of the states. Of greater concern to us is that the 
regional competition process bypasses important state priorities 
established by state advisory boards who have, for many years, guided 
each of the state programs. States put far more money into the 
Institute program than the base funding provided by the USGS and state 
water managers now feel left ``out of the loop'' when it comes to 
providing input to funding decisions. Providing state dollars used to 
match projects which may not be of direct interest or benefit to the 
state does not make much sense to them. Use of Section 104(b) funds for 
the regional competition program is a significant departure from the 
state/federal partnership envisioned in the authorizing legislation. We 
feel the structure of conducting regional and national research would 
be best handled under the authorized 104(g) program, rather than under 
the state-based 104(b) program, as this language directs.
    In conclusion, we believe that the productivity of the Institute 
Program and the evidence of increasing demand for the program speak 
convincingly to the need for continued funding for the Water Resources 
Research Program. The National Institutes for Water Resources are 
grateful for your continuing support of this important state-based 
program. Thank you very much.
                                 ______
                                 

    Prepared Statement of the Coachella Valley Mountains Conservancy

    The Coachella Valley Mountains Conservancy appreciates this 
opportunity to seek the Subcommittee's support for a $1 million 
appropriation to BLM for acquisitions in the Santa Rosa Mountains 
National Scenic Area and for an appropriation to assist NCCP planning 
efforts in southern California.
    The Santa Rosa Mountains National Scenic Area is the large mountain 
range that forms the backdrop of Palm Springs and Palm Desert, and is 
often featured in the Skins golf tournament. The mountains rise quite 
steeply from the desert floor to San Jacinto Peak at 10,800 feet, going 
through five life zones from Sonoran desert to alpine. They are home to 
the peninsular bighorn sheep and several other endangered species. 
There are dozens of palm oases dotting the canyons and mountainsides, 
including Palm Canyon where thousands of palms stretch for miles in the 
largest fan palm oasis in the United States. Cultural resources also 
abound, including Cahuilla Indian village sites along various creeks 
and oases, ancient trails leading from village to village and to food 
gathering locations, rock art, ceremonial sites, and cremation sites. 
Of great importance to the Coachella Valley's economy, hundreds of 
thousands of people who come to the desert each year for vacation enjoy 
our mountains, whether just the view from the fairway or their hotel 
room, or on a visit to the Indian Canyons Heritage Park, a paid jeep 
ride in Palm Canyon, a tram ride to the pine forests, a guided hiking 
tour, or the fastest growing set of uses: on foot, horseback, or 
mountain bike to enjoy the solitude and magnificence of the back 
country.
    The mountains don't just define the valley geographically; they are 
truly the soul of the Coachella Valley. They define it visually and 
emotionally for the residents and visitors on whom our local economy 
depends. The mountains have brought together the cities and the people 
of the valley in a unique partnership with state and federal agencies. 
One expression of that partnership is the Conservancy's Governing 
Board, made up of representatives of seven city councils, the County 
Board of Supervisors, three citizens appointed by the Governor, the 
state Senate, and the state Assembly, the Bureau of Land Management, 
the U.S. Forest Service, the Agua Caliente Band of Cahuilla Indians, 
the California Resources Agency, the University of California, the 
Department of Fish and Game, the Wildlife Conservation Board, and the 
Department of Parks and Recreation. The Conservancy's primary mission 
is to protect the mountains surrounding the Coachella Valley, and our 
acquisitions to protect key areas are all done through partnerships. 
This past year our partnership completed an acquisition in which the 
state's Wildlife Conservation Board and the Bureau of Land Management 
both purchased portions of a 3,000 acre property which the Conservancy 
had been able to option from the owner.
    This coming year we have two more partnership acquisitions lined 
up. The City of Palm Desert wants to cooperate with BLM to purchase a 
property which is proposed for development in the mountains overlooking 
our city. The property sits above Deep Canyon, a major University of 
California Biological Research Center, and is adjacent to the BLM's 
Santa Rosa Mountains National Scenic Area Visitors Center. The City has 
committed $1 million towards the acquisition if BLM will contribute 
some LWCF funds to work with it. The City's goal is to purchase this 
property in phases over the next several years.
    At the other end of the valley is the Snow Creek area which is the 
scenic gateway to the Coachella Valley, and in particular the City of 
Palm Springs. The City has committed matching funds along with the 
Conservancy for a state grant which will enable us to initiate 
acquisitions here. The Conservancy has been working with local 
landowners and we already have more than 1,100 acres of land available 
to us to purchase. Between the city's and the conservancy's matching 
funds and the state grant we expect to receive, we have $500,000 to 
expend. We're looking for a BLM contribution from LWCF, and another 
state contribution from the Wildlife Conservation Board over the next 
two to three years to help acquire the balance of the land.
    The Snow Creek land, like the Palm Desert land, is not important 
just for its scenic qualities, though these are unmatched anywhere. 
Both these areas also figure prominently in a Multiple Species Habitat 
Conservation Plan which covers the entire Coachella Valley and the 
surrounding mountains. The cities, the county, and all the state and 
federal agencies are actively involved in preparing this plan. BLM, for 
example, has committed a GIS person to the effort to work with 
Conservancy staff, and BLM biologists have helped with biological 
surveys. This is perhaps the most cooperative MSHCP effort anywhere. 
The Advisory Group for the effort includes groups as diverse as the 
Sierra Club and the Building Industry Association, and they are 
committed to working together in harmony. For a variety of reasons, not 
the least of which is our past history of success in these kinds of 
efforts going back to the mid 1980's when we developed the second 
habitat conservation plan in the nation for an endangered species, our 
valley has learned that all interest groups accomplish a great deal 
more by working together pragmatically and honestly rather than 
fighting and bickering.
    Land and Water Conservation fund money has been well spent in the 
Santa Rosa Mountains Scenic Area because of these partnerships. The 
money is an investment in more than land. It's an investment in a model 
of local, state, and federal agencies working successfully together, 
and working cooperatively with diverse private sector groups.
    Regarding the Multiple Species Habitat Conservation Plan effort, we 
recently became the first non-coastal sage scrub Natural Communities 
Conservation Plan effort in California. This means that we now qualify 
for some of the NCCP--or Natural Communities Conservation Plan--funding 
which Congress has appropriated in recent years. And just as we have 
with acquisition efforts, we bring a very real partnership to the 
MSHCP/NCCP funding effort. Since we began the planning effort two years 
ago, the funding for it has been almost exclusively local, from local 
grants, local mitigation fees, and local cash contributions from 
conservation groups and the Building Industry Association. BLM has 
contributed a small but very valuable amount of cash and several state 
and federal agencies have made in-kind contributions of staff time. Our 
eligibility for NCCP planning funds will help us complete the plan in 
the next two years. So in addition to seeking your support for LWCF 
acquisition funds to the BLM, the Conservancy also seeks your support 
for continued appropriations for NCCP planning funds. And with the 
number of successful NCCP efforts underway in five southern California 
counties (San Diego, Orange, Riverside, San Bernardino, and Los 
Angeles), it would help tremendously if the amount were increased from 
$2 million to $3 million.
    The Conservancy appreciates your help in previous years, and very 
much hopes to have that same assistance this year to further the 
extremely successful partnerships in the Coachella Valley.
                                 ______
                                 
      Letter From Todd Kellstrom, Mayor, City of Klamath Falls, OR
                                 Klamath Falls, OR, April 10, 1997.
Hon. Slade Gorton,
Chairman, Senate Interior Appropriations Subcommittee,
Washington, DC.
    Dear Mr. Chairman and Members of the Senate Interior Appropriations 
Subcommittee: The City of Klamath Falls is supporting the fiscal year 
1998 appropriations request of the Upper Klamath Basin Working Group 
which was established by Senator Hatfield in the Oregon Resources 
Conservation Act of 1996. The City of Klamath Falls has been an active 
member of the organization since it was first established as the 
``Hatfield Klamath Basin Working Group'' in early 1995.
    The Senator's charge to the new Upper Klamath Basin Working Group 
was to review conservation and wetland issues in the basin and then 
recommend appropriate solutions and projects which would be supported 
by all group members and benefit the Upper Klamath basin. Original 
funding in fiscal year 1996-97 helped establish such programs as Tulana 
Farms Wetlands Restorations, BLM Wood River Wetlands Restoration and 
projects of the Ecosystem Restoration Office (ERG).
    In March 1997, the Upper Klamath Basin Working Group identified a 
third set of restoration projects for implementation under the one 
million dollar ($1,000,000) authorization of the Oregon Resource 
Conservation Act of 1996. These projects include federal, state or 
local matches and are listed as follows:
    1. Restoration of springs in the Sprague and Williamson River 
systems, proposed by the Klamath Tribes, $160,000.
    2. Field trials for an integrated pest management plan on the 
Tulelake and Lower Klamath National Wildlife Refuges, proposed by New 
Horizons Technology, contractor to the U.S. Fish and Wildlife Service, 
$30,000.
    3. Development of a Juniper management program, proposed by the 
Oregon Department of Fish and Wildlife, $100,000.
    4. Riparian fencing and wetland restoration at various locations, 
proposed by Ducks Unlimited, Western Regional Office, Rancho Cordova, 
CA., $150,000.
    5. Riparian protection and stream structures on three parcels of 
private lands, proposed by the Klamath Soil and Water Conservation 
District, $243,350.
    6. Wetlands restoration of Sevenmile Creek, proposed by Water for 
Life, $200,000.
    7. Support for a Geographic Information System center at Oregon 
Institute of Technology, $123,000.
    8. Implement a Bull Trout restoration strategy, proposed by the 
Bull Trout Working Group, $50,000.
    9. Install fish barriers to protect Bull Trout in Sun Creek, 
proposed by the Bull Trout Working Group, $20,000.
    The Working Group also developed a consensus to recommend an 
additional budget request to fund:
    1. The continuation of wetlands restoration work on the Wood River 
Ranch by BLM, $500,000. This is an on-going restoration project of 
3,200 acres.
    2. Implementation of ``Sump Rotation'' as a tool for wetlands 
management and development on the Tulelake National Wildlife Refuge, 
$1,220,000.
    The Upper Klamath Basin Working Group continues to be supported by 
a wide range of differing interests, Klamath Tribes, Oregon Department 
of Fish and Wildlife, Agriculture, Grazing, Industries, City of Klamath 
Falls, Klamath County, Conservation Groups, Oregon Governor's Office, 
Federal agencies and private citizens. There is also coordination 
within the two state (Oregon and California) area with the Klamath 
Rivers Fisheries Task Force, the Klamath River Compact Commission, and 
the Trinity River Task Force. These groups work on developing support 
through consensus building so that all may agree and support the 
resulting actions and funds.
    Therefore, the City of Klamath Falls respectfully requests that you 
appropriate the $1 million, as authorized under the Oregon Resources 
Conservation Act of 1996, for the nine restoration projects identified 
above for the Upper Klamath Basin in fiscal year 1998. In addition, 
supplemental funding to accomplish the Wood River Wetlands restoration 
and the ``sump rotation'' on the Tulelake National Wildlife Refuge. The 
total restoration effort will provide solutions that can lead to 
recovery of the endangered sucker, downstream salmonids, and potential 
future endangered species listings. These projects will also help the 
agriculture communities, the City and County, Native American tribes, 
as well as commercial interest on the Klamath River both in Oregon and 
California.
            Respectfully submitted,
                                            Todd Kellstrom,
                                                             Mayor.
                                 ______
                                 

  Prepared Statement of Commissioner Joe Judd, on Behalf of the Kane 
                        County, Utah Commission

Fiscal year 1998 Request: $820,000 for the ``Partnership 
        Demonstration'' program with the Bureau of Land Management for 
        the Grand Staircase-EscaLante National Monument
    Mr. Chairman, and members of the Subcommittee on Interior and 
Related Agencies; I would like to express my great appreciation to you, 
on behalf of the Commissioners and people of Kane County, for allowing 
us to testify regarding the Grand Staircase-Escalante National 
Monument--and the resulting impacts of the monument on both the land 
and residents of Kane County.
    Let me begin by saying that our initial reaction to the surprise 
announcement by the President was one of great anger and frustration at 
being left out of the deliberations. However, despite our 
disappointment, we collectively decided to be included in any future 
deliberations and decisions that will so greatly affect our lives. We 
subsequently accepted an offer by the Secretary of the Interior to 
participate smith the Bureau of Land Management in the three-year 
assessment and planning process.
    We signed a Cooperative Agreement with the Bureau which will 
provide up to $200,000 in fiscal year 1997 to ``* * * facilitate the 
improvement of the economic, cultural, and other resources of the 
county and to facilitate the BLM's planning process for the Monument.'' 
Our first responsibility is to develop an analysis of county 
infrastructure requirements, law enforcement, transportation needs, 
search and rescue and other impacts due to the designation of the 
monument.
    Through our initial assessments, we estimate that Kane County's 
funding requirement to continue in the planning process in fiscal year 
1998 is $250,000. We are requesting that this agreement be established 
in the appropriations bill as a ``Partnership Demonstration'' line-item 
for the planning effort with the BLM.
    Additionally, there will be a great increase in the demand for 
basic emergency services as a direct result of the monument designation 
and will require a minimum of $570,000 in fiscal year 1998.
    This comes to a total of $820.000.
    It is clear that we must quickly prepare for the consequences of 
putting this area on the tourist map. The character of the area is 
seductive and inviting, but very harsh and unforgiving on those who are 
unprepared. We anticipate a very sharp increase in persons getting lost 
in the area, or stranded, hurt or worse. Kane County, at this point, is 
simply unable to adequately carry out public safety services of search 
and rescue and related health, sanitation and law enforcement 
requirements that will be immediately essential.
    Mr. Chairman, this is not a Kane County Monument, this is a 
National Monument. It was created by the President of the United States 
on behalf of the American people. The proclamation was widely and 
warmly supported by the American people. And, as far as I know, it has 
never been deliberate U.S. policy or practice to simply dump all of the 
responsibilities and costs of a National Monument off on the citizens 
who happen to live adjacent to the boundaries.
    The costs to provide a suitable monument experience, both inside 
and outside of the boundaries will be significant. I doubt that there 
are few people, including the President, who have an appreciation for 
just how large and diverse these monument lands are. This was an 
enormous decision with enormous consequences. The area takes in about 2 
million acres. That is 3,125 square miles. About 70 percent of this, 
about 2,590 square miles, is in Kane County. The monument is larger 
than Manhattan and Long Island combined--it is about the size of the 
state of Delaware. But it is much more than big. It is a very diverse 
topography that ranges from the very stark--without any vegetation--to 
the more familiar red cliffs and forests highlighted by the media.
    We believe, as the President does, that it should be seen, and 
certain segments could provide an outstanding monument experience with 
sufficient care and with sufficient resources. Of course, large parts 
of the area are less accessible, and will be difficult to view, 
resulting in very low visitations. Some areas are very fragile and 
should be protected from visitations.
    But whether we want people come to the monument or not, or if there 
is adequate access or not, it is too late. They are arriving already 
and will continue to come in larger and larger numbers. The President's 
proclamation has, in effect, changed the character of the area forever.
    The infrastructure to support visitors (access roads, basic 
sanitation facilities, good accommodations and information, both in and 
beyond the boundaries of the monument) simply does not exist. That, of 
course, is the purpose of our planning process. And because the 
facilities and infrastructure adjacent to the monument are as critical 
as those within, we believe our participation is not a privilege but an 
obligation on the part of the government; even a responsibility on our 
part.
    But within the obligation, we have seen an opportunity--an 
opportunity for the Federal Government to establish a Partnership with 
Kane County. Not just some vague ``input,'' but a separate and 
essential role in that partnership.
    This is an opportunity to demonstrate to other, and very skeptical, 
local governments, throughout the United States, that the Federal 
Government is sincere when it states, as the President did, that this 
is ``* * * the beginning of a unique three-year process during which 
the Bureau of Land Management will work with state and local 
governments * * *'' to set up a land management process.
    Fiscal year 1998 funding will allow us to continue in the direction 
we have already begun with the Cooperative Agreement. The agreement is 
a very ``unique'' beginning and it is working. We have begun a planning 
process that is based on cooperation, open communications, and 
fledgling trust. We have been persuaded to reach out to the government 
and say--``Okay we will give it a try. We will take a risk.'' But there 
are any number of people who are saying that we are crazy to trust the 
government.
    Well, I hope not. So we are asking you, the Federal Government: Do 
not abandon us now that we have made a commitment.
    I met with Secretary Babbitt and I was convinced of his sincerity 
when he said he wanted this process to work. And the BLM has said 
repeatedly that they believe a local partnership with full cooperation 
is a great benefit to them in managing the largest national monument in 
the lower 48 states.
    As the members of the committee know, this is the first National 
Monument for the Bureau of Land Management. We support the decision by 
the President to retain management of the area with the Bureau. The 
President stated in his announcement at the Grand Canyon that the 
monument was to be continued in multiple-use management. That is a 
critical consideration both in the retention of the BLM and the 
inclusion of the local government's participation in planning, and 
where appropriate, decision making.
    It is my understanding that the President's budget calls for an 
additional $5,000,000 for the monument. We think that is an important 
level of funding, but Kane County requires the additional amount of 
$820,000, at least for fiscal year 1998. It may be ultimately possible 
to discover or create the means for the monument to pay for itself 
through fees or other mechanisms. But for the immediate future a 
sufficient level of funding is critical to provide the basic services 
for these new visitors. Kane County simply does not have the money.
    We have heard it said already, Mr. Chairman, that Kane County will 
experience an amazing and lucrative boom--a windfall--because of all 
the increased tourism that the monument will generate. The truth is, we 
fervently hope that the predicted flood of tourists does not occur--
especially in the next year or two. For each tourist dollar brought in, 
it costs the county $1.25 to provide all of the needed services: law 
enforcement, visitor aid, indigent care, as well as other community 
resources to provide for fire protection, and water and sewer services.
    Tourism on its own does not provide a stable economy. It is both 
seasonal and a second wage-earner employer. Kane County, is an area of 
4,800 square miles, but the county has less than 7,000 permanent 
residents. Public lands comprise 95 percent of the county. There are 
very few families supported by primary jobs; for the most part our 
families are forced to survive on minimum wage jobs. This provides a 
very low tax base. And, because of the lack of primary jobs, young 
people are unable stay in the county. In Utah, persons in the 25-34 age 
group make up 25 percent of the population. But in Kane Co., it is 17 
percent. When our young people graduate from college, we say, 
``Congratulations, and goodbye.'' We have a disproportionate share of 
25-30 year old heads of households earning less than $15,000 per year. 
The poverty level for a family of five is $14,990 per year.
    The hope for Kane County was to have been in the Smoky Hollow mine, 
an underground coal mine which was being reviewed through the EIS 
process as established by the Environmental Policy Act. The mine was to 
provide jobs--primary jobs--and provide desperately needed revenues for 
the schools and for basic county services. Our county's recreation and 
transportation special services district loses $500,000 per year and 
will continue to do so for a period beyond our life spans. Our county 
has an assessed tax base of $300 million. The Andalex facility would 
have added $90 million to our tax rolls.
    Any prospect for the mine has apparently been eliminated. In fact, 
the President mentioned the mine by name in his declaration statement 
at the Grand Canyon. He said ``I am concerned about a large coal mine 
proposed for the area * * *'' and went on to say that he hoped that 
``Andalex'' will find a way to pursue its mining operations elsewhere. 
He said ``* * * we shouldn't have mines that threaten our national 
treasures.''
    Well, we did not agree with that assessment, but that is way beyond 
our ability to affect. All we can do now is look forward and try to 
build a future for our children. We can also help to build a monument. 
Together, we can provide a proper monument experience without degrading 
the environment or the quality of life of a people who have lived in 
harmony with the land for generations.
    Mr. Chairman, we are hopeful that the cooperation between the 
Federal government and local government will continue to be supported. 
We are beginning to record the history of this partnership and at the 
same time create a video and other materials which will provide 
information to the public, and we welcome your participation.
    We do not represent any narrow point of view or philosophy. We have 
a planning process that is open to all citizens and the very diverse 
citizen groups. All we ask of the Congress is the opportunity to 
continue to be a part of this new and unique opportunity to create a 
great monument that protects the landscape and provides a variety of 
multiple uses for the benefit of all people.
    We do not have any money, we have very few votes, and no power. We 
do not come here today with threats--just a simple request that we not 
get brushed aside--discarded--as others rush in to command or make 
convenient and ``low-cost'' but short-sighted decisions that will 
foreclose the hopes and expectations of the American people who warmly 
supported the decision to create a new monument.
    We invite you to come to Kane County--come see it for yourselves. 
The subcommittee staff have visited the area, but snow conditions 
decreased mobility even while increasing the aesthetic qualities of one 
of the most beautiful areas of the world.
    Thank you again for the opportunity to testify on behalf of the 
county and I welcome whatever questions you may have.
                                 ______
                                 

  Prepared Statement of Jack A. Barnett, Executive Director, Colorado 
                   River Basin Salinity Control Forum

    This testimony is in support of funding for the Colorado River 
salinity control program. The Bureau of Land Management has chosen to 
reformulate its budgeting process so as to support ecosystems and 
watershed management. The activities needed to control salinity being 
contributed from the BLM lands are a part of ecosystem and watershed 
management. Because the budgeting process lumps all activities 
together, we can only presume that there is adequate dollars in the 
President's budget to move ahead with the water quality enhancement and 
protection programs needed in the Colorado River drainage to ensure 
that the salts in excess amounts are not contributed to the river 
system. Our analysis indicates that the Bureau of Land Management needs 
to specifically target the expenditure of funds in the amount of 
$4,500,000 to salinity control in fiscal year 1998.
                                overview
    The Colorado River Basin salinity control program was authorized by 
Congress in 1974. The Title I portion of the Colorado River Basin 
Salinity Control Act responded to commitments that the United States 
had made via a treaty with Mexico with respect to the quality of water 
being delivered to Mexico below Imperial Dam. Title II of the Act 
established a program to respond to salinity control needs of Colorado 
River water users in the United States and to comply with the mandates 
of the then newly legislated Clean Water Act. Initially, the Secretary 
of the Interior and the Bureau of Reclamation were given the lead 
Federal role by the Congress. This testimony is in support of funding 
for the Title II program.
    After a decade of investigative effort, the Basin states concluded 
that the Salinity Control Act needed to be amended. Congress revised 
the Act in 1984. That revision, while keeping the Secretary of the 
Interior as lead coordinator for Colorado River Basin salinity control 
efforts, also gave new salinity control responsibilities to the 
Department of Agriculture, and to a sister agency of the Bureau of 
Reclamation--the Bureau of Land Management. Congress has charged the 
Administration with implementing the most cost-effective (dollars per 
ton of salt removed) program practicable. The Basin states are strongly 
supportive of that concept, as the Basin states cost share between 25 
and 30 percent of these federal expenditures for the salinity control 
program, while in addition proceeding to implement their own salinity 
control efforts in the Colorado River system.
    Since the congressional mandates of nearly two decades ago, much 
has been learned about the impact of salts in the Colorado River 
system. The Bureau of Reclamation has recently completed studies on the 
economic impact of these salts. Reclamation recognizes that the damages 
to United States' water users alone may soon be approaching $1 billion 
per year.
    The Colorado River Basin Salinity Control Forum (Forum) has become 
the seven-state coordinating body for interfacing with federal agencies 
and Congress to support the implementation of a program necessary to 
control the salinity of the river system. Forum members are appointed 
by the governors of the seven Colorado River Basin states. In close 
cooperation with the Environmental Protection Agency (EPA) and under 
requirements of the Clean Water Act, every three years the Forum 
prepares a formal report analyzing the salinity of the Colorado River, 
anticipated future salinity, and the program necessary to keep the 
salinities at or below the levels measured in the river system in 1972.
    In setting water quality standards for the Colorado River system, 
the salinity levels measured at Imperial, Parker, and Hoover Dams in 
1972 have been identified as the numeric criteria. The plan necessary 
for controlling salinity has been captioned the ``plan of 
implementation.'' The 1993 Review of water quality standards includes 
an updated plan of implementation. The level of appropriation requested 
in this testimony is in keeping with the agreed to plan. If adequate 
funds are not appropriated, state and federal agencies involved are in 
agreement that the numeric criteria will be exceeded and damage from 
the high salt levels in the water will be widespread and very 
significant.
                             justification
    The BLM is, by far and away, the largest landowner in the Colorado 
River Basin. Much of the lands that are controlled and managed by the 
Bureau of Land Management are heavily laden with salt. Past management 
practices, which include the use of lands for recreation; for road 
building and transportation; for oil, gas, and mineral exploration; and 
most importantly, for grazing, have led to man-induced and accelerated 
erosional processes. When soil and rocks heavily laden with salt erode, 
the silt is carried along for some distance and ultimately settles in 
the streambed or flood plain. The salts, however, are dissolved and 
remain in the river system causing water quality problems downstream.
    The Forum believes that the federal government has a major and 
important responsibility with respect to controlling pick-up of salt 
from public lands. Congress charged the federal agencies with 
proceeding with programs to control the salinity of the Colorado River, 
with a strong mandate to seek out the most cost-effective options. It 
has been determined that BLM's rangeland improvement programs can lead 
to some of the most cost-effective salinity control measures available. 
These salinity control measures are more cost-effective than some now 
being implemented by the Bureau of Reclamation and by the Department of 
Agriculture. They are more environmentally acceptable, as they will 
prevent erosion, increase grazing opportunities, increase dependable 
stream runoffs, and enhance wildlife habitats.
    Through studying hundreds of watersheds in the States of Utah, 
Colorado, and Wyoming, the BLM has selected several watersheds where 
very cost-effective salinity control efforts could be implemented 
immediately. In keeping with the Congressional mandate to maximize the 
cost-effectiveness of salinity control, the Forum is requesting that 
out of the overall requested and authorized budget the Congress 
appropriate and the administration allocate adequate funds to support 
the Bureau of Land Management's portion of the Colorado River salinity 
control program as set forth in the adopted plan of implementation.
             details concerning the requested appropriation
    After conferring with BLM officials, the Forum believes there needs 
to be spent in fiscal year 1998, by the Bureau of Land Management, 
$4,500,000 for salinity control. We are particularly concerned that the 
line-item titled Management of Lands and Renewal Resources is 
adequately funded.
    The Forum believes that although it is commendable for the 
administration to formulate a budget that focuses on ecosystems and 
watershed management, it is essential that funds be targeted on 
specific sub-activities and the results of those expenditures reported; 
this is necessary for accountability and for the effectiveness of the 
use of the funds. The Forum requests that the Committee require 
accounting by the Bureau of Land Management in such a way that the 
results of their activities in connection with the expenditures the 
funds can be reviewed and measured.
                                 ______
                                 

     Prepared Statement of Cyrus M. Jollivette, Vice President for 
       Government Relations, on Behalf of the University of Miami

    Mr. Chairman and Members of the Subcommittee: I appreciate the 
opportunity to present testimony on behalf of the University of Miami. 
The University is seeking your continued support for a major 
environmental initiative within your purview, the South Florida 
Ecosystem Restoration Prediction and Modeling Program (SFERPM).
    Florida Bay is a triangularly shaped body of water about 2200 sq. 
km in area. Over 80 percent of the Bay lies within Everglades National 
Park. The Bay is bounded by the Florida Everglades on the north and the 
Florida Keys on the southeast. In the Bay over 200 small islands or 
``keys'' occur, many of which are rimmed with mangroves and have 
interior, irregularly flooded, ``flats'' with calcareous algal mats. 
The Bay is shallow, often hyper-saline, and, until recently, was 
characterized by clear waters, and lush sea grass meadows covering a 
mosaic of shallow water banks and numerous relatively deeper water 
basins or ``lakes''. Deep narrow channels connect neighboring basins. 
Hard bottom habitats in southwestern Florida Bay support sponge and 
hard and soft coral communities.
    Florida Bay is known as the principal inshore nursery for the 
offshore Tortugas pink shrimp fishery, for providing critical habitat 
for juvenile spiny lobster, stone crab, and many important finfish 
species. While the Bay is the site of an extensive sport fishery, it is 
also important as a nursery area for many recreationally important 
finfish in the Florida Keys National Marine Sanctuary. Moreover, the 
Bay supports numerous protected species included the bottlenosed 
dolphin, several species of sea turtles, manatees, and the American 
crocodile.
    There are many indications that the environmental health of Florida 
Bay has deteriorated. Fishing success has declined for many of the 
species that depend upon the Bay as a juvenile nursery habitat. 
Atypical algal blooms, attributing to sponge and manatee dieoffs, are 
occurring in the Bay and Florida Keys. Mangroves appear to be in 
decline. While the causes of the various problems and the relationships 
between them are not well understood, there is no question that, like 
the sawgrass habitat of the Everglades, the coastal marine ecosystem of 
Florida Bay is in jeopardy.
    The objective of the South Florida Ecosystem Restoration Prediction 
and Modeling Project is to provide decision-makers who are working to 
restore and maintain a healthy South Florida coastal ecosystem with 
reliable scientific information. At present there is insufficient 
knowledge to predict with confidence the consequences of alterations in 
freshwater input to Florida Bay.
    Since no one can turn back the clock and South Florida's rapid 
development will almost certainly continue, a series of compromises and 
tradeoffs will have to be made in restoring and maintaining a healthy 
South Florida coastal ecosystem including Florida Bay. It is essential 
that decisions be made based on reliable scientific information. That 
is the objective of the South Florida Ecosystem Restoration Prediction 
and Modeling program. Which is collaboratively managed and conducted by 
the National Oceanographic Atmospheric Administration's Atlantic 
Oceanographic and Meteorological Laboratory and the National Marine 
Fisheries Service Miami Laboratory and the Rosenstiel School of Marine 
and Atmospheric Science.
    My colleagues at the Rosenstiel School of Marine and Atmospheric 
Science urge you, Mr. Chairman, to provide $6 million in dedicated 
funding for SFERPM. This project is a multi-agency activity in which 
more than 80 Florida entities are at work seeking solutions to these 
critical issues.
    Mr. Chairman, my colleagues and I know what a difficult 
appropriations year you face. However, again, we respectfully request 
that you give very serious consideration to providing dedicated support 
for the South Florida Ecosystem Restoration Prediction and Modeling 
program so that sufficient information is available upon which to base 
decisions for maintaining a healthy South Florida coastal ecosystem 
including Florida Bay.
                                 ______
                                 
   Letter From B. Sharon Meeker, Chairperson, Lamprey River Advisory 
                               Committee
                                    New Market, VA, March 17, 1997.
Hon. Slade Gorton,
Chair, U.S. Senate, Interior Appropriations Subcommittee,
Washington, DC.
    Dear Senator Gorton: The Lamprey River Advisory Committee is 
writing request your support of appropriations for two National Parks 
Service programs: The Wild and Scenic River Coordinator Program; and 
the Watershed implementation Program, under the Rivers and Trails 
Conservation Assistance Program.
             a. wild and scenic river coordination program
    The Lamprey River was designated into the National Wild and Scenic 
Rivers System in November of 1996. Our local River Management Advisory 
Committee has successfully developed a River Management Plan with the 
invaluable assistance of the National Parks Service. To foster the 
implementation of this Plan, our Committee hopes to have the continued 
support of the Parks Service in coordinating efforts between us and 
appropriate state and federal agencies--an often daunting role for 
local citizens
    While our goals have been defined and accepted by our towns, our 
Committee frequently relies upon the knowledge and experience of Parks 
Service staff to help us choose the best means for accomplishing those 
goals. We are in particular need of NPS technical advice in reviewing 
development proposals affecting the river and in designing future 
studies which will help us in our mission.
    Some specific examples: First: a golf course on miles of river 
frontage has been proposed. The NPS has helped our Committee to contact 
the state and federal agencies able to help us evaluate and comment on 
the proposal. Second: in order to meet the River Management Plan goals 
of preserving important habitat, our Shoreland Conservation 
Subcommittee needs fieldwork done to identify key lands. The NPS helps 
to find those experts, oversees the studies, and connects us with 
public and private organizations which can offer landowners incentives 
for protecting those areas. Third: an early dam and mill site on the 
National Register of Historic Places, long neglected, has become a 
public safety hazard and was being closed off from the public. An NPS 
planner is working with neighbors and town officials to redevelop the 
area so it is a safe passive recreation and historic area with good 
access.
    The Lamprey River Advisory Committee is counting on the continued 
help of the National Parks Service under this program to make the 
nation's newest Wild and Scenic River an asset to all.
                    b. watershed plan implementation
    After achieving Wild and Scenic designation for the lower three 
towns in the Watershed, it has become obvious that achieving our 
Management Plan goals must involve the whop Lamprey Watershed. Based on 
surveys of riverfront landowners and data from State agencies, the 
Lamprey's Local River Advisory Committee has taken a particular 
interest in point- and nonpoint-source pollution originating both 
within and upstream of the Wild and Scenic designated river segment. We 
are also concerned about the need for river resource protection in some 
upstream towns.
    With the help of the National Parks Service, the Lamprey River 
Management Advisory Committee has just initiated an outreach effort to 
support other conservation groups throughout the Watershed. Our goal is 
to coordinate more consisted protective land and water use policies and 
public education/public support efforts in the nine towns.
    The Parks Service has helped us break the ice with upstream towns. 
Expanding our efforts to include another 30 miles of river and hundreds 
of square miles of watershed is a challenge, and we are relying heavily 
on NPS expertise. The Northeast Regional Office has proven invaluable 
in guiding our initial efforts, arranging for an intern from the 
Quebec-Labrador Foundation to help produce the first watershed-wide 
newsletter. This effort connected conservation-minded groups throughout 
the area in a common effort that is already bearing fruit.
    As drought strikes the Northeast more frequently, we are also 
concerned-with water withdrawals from the river, especially coupled 
with wastewater treatment plant discharges into it. This must be 
addressed in a watershed-wide effort We are looking forward to Parks 
Service technical assistance in researching options and negotiating 
with the various interests involved.
    In sum, the Lamprey River Management Advisory Committee is deeply 
appreciative of the support of the National Parks Service in providing 
guidance, technical assistance and coordination with public and private 
organizations in helping us reach our goals for the enhancement and 
protection of the Lamprey River. We ask that you support the 
appropriations for the Wild and Scenic River Coordination Program and 
the Watershed Plan Implementation program under the Rivers and Trails 
Conservation Assistance Program.
            Sincerely,
                                          B. Sharon Meeker,
                                                             Chair.
                                 ______
                                 

Prepared Statement of Eric Hertfelder, Executive Director, on behalf of 
    the National Conference of State Historic Preservation Officers

national conference of state historic preservation officers request for 
        fiscal year 1998 from the historic preservation fund \1\
State Historic Preservation Programs....................     $31,000,000
National Trust for Historic Preservation................       3,500,000
Tribal grants/Tribal Preservation Offices...............       2,750,000

      national conference of state historic preservation officers
    The National Conference of State Historic Preservation Officers is 
the professional association of the State Historic Preservation 
Officers, the officials designated by each State's governor to act for 
the Secretary of the Interior in carrying out the National Historic 
Preservation Act (16 U.S.C. 470) within each State.
   historic preservation fund: the keystone of historic preservation
    The Nation's approach to historic preservation is based on team 
work. Beginning in the 1960's, the federal government defined a 
national approach to the preservation and productive use of our 
heritage and asked the States to do the work--and pay half the cost.
    The Historic Preservation Fund provides the essential foundation 
for the national historic preservation program. The federal dollars 
attract the State, local and private match; the federal dollars provide 
the incentive for States to team up for preservation and run the 
nation's preservation program within their borders.
    Without that federal investment, States lack the incentive and the 
ability to run the nation's program and would focus solely on State 
initiatives.
       where the historic preservation fund goes: the states \2\
    A. Survey: ``Ground zero'' for the national historic preservation 
program is historic sites survey: locating and recording places that 
are part of the nation's 13,000 year history. State Historic 
Preservation Offices maintain maps, photographs and written 
descriptions of the historic places within their borders.
    B. National Register: The National Register of Historic Places is 
the national standard for defining historic significance, defining 
which properties should receive historic preservation treatments and, 
importantly, which will not.
    C. Planning: State Historic Preservation Offices, working with the 
public, take a comprehensive look at their State, their State's 
historic resources, opportunities and needs and craft a set of 
priorities for historic preservation actions.
    D. Local governments: Since 1980, local governments have had the 
option of becoming official partners with State Historic Preservation 
Of fires. Certified local governments' primary responsibility is 
participation in the National Register nomination process. However, 
States and certified local governments agree on other partnership 
activities. In Georgia, several certified local governments assume the 
State Historic Preservation Office's role in consultation with federal 
agencies.
    E. Rehab tax credit: State Historic Preservation Offices' work with 
developers interested in investing in the rehabilitation of National 
Register-listed buildings.
    F. Federal agency coordination and consulting: State Historic 
Preservation Offices assist federal agencies and applicants, on roughly 
100,000 projects nationally each year, in avoiding harmful effects to 
historic places.
    G. Monitoring past restoration grant easements: State Historic 
Preservation Offices continue to monitor the covenants placed on 
properties that received grants (Pre-1981).
    H. Public education: Providing information and training on historic 
preservation is an on-going responsibility of State Historic 
Preservation Offices from monthly newsletters, to annual conferences, 
to local government training.
                 what the federal investment has earned
    A. Construction generated through historic rehabilitation credits: 
\3\ $757,000,000 for fiscal year 1996 from 509 projects rehabilitated 
following the Secretary of the Interior's Standards for Rehabilitation. 
State Historic Preservation Offices assisted developers in the three-
part review process prior to the National Park Service staff re-review.
    B. New housing units: 6,009 units of housing of which 3,513 are 
low/moderate income were created in fiscal year 1996 because of the 
rehab credits.
    C. Interest in heritage: In the thirty years since the National 
Historic Preservation Act, historic preservation has entered the 
American vocabulary. The success of such magazines as Colonial Homes, 
and television programs as ``This Old House,'' attests to the interest 
in historic preservation among the general public. Analysis of tourism 
statistics shows that visiting historic sites ranks high (second 
highest motivator for tourists--in Massachusetts, Virginia and 
Maryland) among the reasons for tourism. The spontaneous popularity of 
heritage areas across the country spans the nation from Tracks Across 
Wyoming, to Silos to Smokestacks in northeastern Iowa, to the Ohio and 
Erie Canal, to Essex County in Massachusetts.
    D. Inventories are the foundation for heritage area development and 
cultural tourism:
    1. The Alaska Gold Rush Centennial Task Force is co-chaired by the 
State Historic Preservation Officer and the State director of tourism 
and involves a decade-long program. 1996 projects included 
commemorative license plate, a Gold Rush Era Pioneers and Properties 
Recognition Program, a U.S. postage stamp and a historic signage 
project in cooperation with the State transportation department.
    2. Pennsylvania heritage parks program started with research done 
by the Bureau of Historic Preservation from their inventories of 
historic sites. Currently the Pennsylvania Office is preparing a 
historic context on the anthracite coal industry making it easier to 
assess the significance of coal industry resources and providing 
information for interpretation of historic sites.
    3. California State Historic Preservation Office is working with 
Mexico's National Institute of Anthropology and History on the El 
Camino Real Misionero de Las Califomias Heritage Corridor. The 
international agreement was signed on April 27, 1997. The New York 
Times on Sunday January 26, 1997, recognized the work of Mario Sanchez 
of the Texas State Historic Preservation Office on the Los Caminos del 
Reo heritage area.
    4. The Alabama Historical Commission's long-time research historic 
places related to the civil rights movement set the foundation for the 
Federal Highway Designation of designation of U.S. 80 between Selma and 
Montgomery as an All American Highway and National Historic Trail.
    E. Benefits from consultation with federal agencies on section 106:
    1. The Section 106 process opened a dialog between the Alabama 
Historical Commission and federal agencies to prevent the demolition of 
the Montgomery Greyhound Bus Station, a major Civil Rights movement 
historic site, and led to its restoration as a museum and a long-
distance learning center with connections to students across the 
nation.
    F. Affordable housing:
    1. The Ohio State Historic Preservation Office initiated 
discussions among federal, state and local agencies with housing 
responsibilities which resulted in a State task force on affordable 
housing and historic preservation to facilitate compliance with federal 
standards.
    2. The Illinois State Historic Preservation architect working with 
a HUD-funded rehabilitation in Chicago showed the developer how the 
housing goals could be met within the Secretary of the Interiors 
Standards for Rehabilitation therefore making the National Register-
eligible building eligible for historic rehabilitation tax credits.
    3. The New Hampshire State Historic Preservation Office encouraged 
the Drewsville Mansion Affordable Housing and Head Start Project in 
Walpole to use the historic rehabilitation tax credit in addition to 
the low-income housing credit for the preservation aspects of the 
1880's stick style building creating links between Southwestern 
Community Services, the New Hampshire Housing Finance Authority, the 
Office of State Planning, and the Preservation Office.
    G. Historic Preservation and industry work together:
    1. American Samoa Historic Preservation Office established a 
partnership with the American Samoa Power Authority to identify 
historic sites, prepare National Register nominations and expedite the 
construction of a sewer line.
    2. The Georgia Power Company funded the reprinting of the Georgia 
State Historic Preservation Office's driving tour publication 
Preserving the Legacy: A Tour of African American Historic Resources in 
Georgia in time for the Olympics.
    3. The First Hawaiian Bank funded the publication of the Hawaii 
State Historic Preservation Office's book On Bishop Street tracing a 
century of history of Honolulu's financial and corporate center.
    H. Rural preservation: historic barns:
    1. The Illinois State Historic Preservation Office's subgrant to 
Kane County, a certified local government, resulted in ``That Darn 
Barn'' calendar which has become a successful tool for promoting the 
significance of rural heritage as citizens face land use planning 
decisions.
    2. The Ohio State Historic Preservation Office and the Ohio State 
University Extension Service conducted workshops for and provided 
notebooks to rural property owners on technical issues related to the 
continued use and preservation of barns.
    3. The New York State Historic Preservation Office provided the 
Governor with ideas on the preservation of historic barns which 
resulted in legislation creating tax incentives for barn owners.
    4. The Wisconsin State Historic Preservation Office's barn 
preservation program includes workshops on preservation techniques and 
a 14,000-entry publication to help owners understand the significance 
of their buildings, prepare National Register nominations and apply for 
federal rehabilitation tax credits.
                             vi. conclusion
    The State Historic Preservation Of fleers express their 
appreciation to the Subcommittee for its past support. The need to 
identify our nation's historic properties, and to find ways to preserve 
them is continuous, and is a responsibility borne by all levels of 
government as well as the private sector. The Historic Preservation 
Fund programs are key components of the federal government's 
contribution to this effort, and enable the intergovernmental 
partnership that has accomplished so much in the past 30 years.
    Although directed toward appropriations from the Historic 
Preservation Fund, our testimony would not be complete without 
requesting continuing support for our key federal government partners 
the Advisory Council on Historic Preservation at $2.745 million and the 
National Park Service, National Recreation and Preservation, at $42.063 
million.
                               end notes
    1. NCSHPO request for federal preservation partners: Advisory 
Council on Historic Preservation: $2.745 million, National Park Service 
National Recreation and Preservation: $42.065 million.
    2. The National Conference testimony addresses the State Historic 
Preservation Office programs, not the National Trust or tribal grants.
    3. Source for figures on the rehabilitation tax credit: Heritage 
Preservation Services Program, National Park Service, ``Federal Tax 
Incentives for Rehabilitating Historic Buildings, fiscal year 1996 
Report and Analysis,'' Washington, DC, 1997.
                                 ______
                                 

  Prepared Statement of Samuel N. Penney, Chairman, Nez Perce Tribal 
                          Executive Committee

    Mr. Chairman, members of the subcommittee, my name is Samuel 
Penney, and I appreciate the opportunity to submit testimony for the 
record. The Nez Perce Tribe appreciates your efforts to solicit our 
views and to stretch scarce federal dollars to meet our needs.
                        cadastral survey station
    As the Committee knows, we have repeatedly sought an appropriation 
to the Bureau of Indian Affairs real property program to assist in the 
establishment of a Bureau of Land Management cadastral survey station 
on the Nez Perce Reservation. The survey is necessary for several 
reasons including the successful management of our natural resources. 
It is also necessary to help Indian and non-Indian residents of the 
reservation in the resolution of boundary disputes. Our reservation has 
been heavily checker boarded through the allotment process over the 
years. Because of the lack of accurate survey data, we are encountering 
a growing number of disputes that arise because of uncertainty of 
property boundaries. The boundary disputes create ill will among the 
residents of the reservation and lead to unnecessary expenditures of 
public and private funds.
    We have recently executed an interagency agreement with the Bureau 
of Indian Affairs and the Bureau of Land Management to establish a 
cadastral survey station on the reservation, if funds are allocated. 
The agreement calls for a budget of $100,000 for fiscal year 1998, with 
an additional $450,000 to be spent over the following four years. 
Establishment of a survey station is a significant commitment by the 
Bureau of land Management and they have requested at least a three-year 
funding commitment. Currently, there are enough boundary disputes to 
require a survey station for at least three years. Given the recent 
experience in only two of these disputes that became highly 
controversial, we believe that the expenditure of funds on a cadastral 
survey is the most cost-effective use of federal funds.
                         wolf recovery program
    We have been proud to participate in the Wolf Recovery Program with 
the U.S. Fish and Wildlife Service. This is the only effort in the 
nation in which a tribe is leading the recovery effort for an 
endangered species. Through a contract with the Service, the Tribe has 
produced the recovery plan for wolves in Central Idaho and is 
implementing the plan, now approved by the Service.
    However, the project is badly under funded. The funding shortfall 
threatens our ability to adequately monitor the new pairs, which are 
scattered throughout fifteen million acres, to determine whether they 
will produce litters this spring. The recovery standard for these 
wolves is reaching ten breeding pairs for three consecutive years. If 
sufficient funds are not available to determine how many pairs are 
breeding, we will be unable to determine when the recovery standard is 
met. We are very pleased with the progress the project has made over 
the last two years, but need additional funds to accurately assess the 
extent of its success. We are asking for a supplemental appropriation 
for fiscal year 1997 of $100,000 and for annual appropriations for 
fiscal year 1998 and following fiscal years of $250,000.
            indian health service clinic construction funds
    The IHS clinic which serves the largest tribal community on the 
reservation is an antiquated, inadequate, hazardous facility. We are 
seeking congressional funding and support for an IHS joint venture 
authorization to replace it. The IHS architectural survey completed 
over two years ago calculated constructions costs for a 17,000 square 
foot facility at approximately 2.2 million dollars. Land has been 
identified on which this facility could be build. The need for a new 
clinic is urgent.
          snake river basin adjudication negotiations funding
    Since 1987, the Nez Perce Tribe has been engaged in an adjudication 
of its water rights in the Snake River basin. This litigation commenced 
by the State of Idaho, is the largest water rights adjudication in the 
entire nation. We are represented in this proceeding by our own in-
house counsel and by the Native American Rights Fund (NARF) in Boulder, 
Colorado. The litigation has been stayed for most of the last year. 
During this time the Tribe has worked intensively on negotiations of 
its water rights in four separate sets of negotiations, each relevant 
to a particular geographic area covered by the tribal claims. The 
parties, including the Tribe, the Departments of Justice and Interior, 
the State of Idaho, and the private water users in each area have been 
quite successful in narrowing issues. Currently, we are in a critical 
period of negotiations which may determine whether they can ultimately 
succeed. The trial court judge has made it very clear to all parties 
that he will not stay this litigation indefinitely. Therefore, our 
negotiations are increasingly intensive and our funding needs for the 
negotiations are that much more critical.
    For fiscal year 1998, we are requesting $710,000 be made available 
in the BIA's Water Resources and Rights Protection account to NARF for 
its work on the Tribe's behalf. Of that amount, $520,000 would cover 
consultant contracts with experts assisting the Tribe and NARF in the 
negotiations. These would include experts in fisheries and engineering, 
an economist, and the tribal attorney assigned to the case. The 
remaining $190,000 would cover the NARF staff time and expenses for the 
two attorneys and an assistant assigned to the case.
    This concludes our written testimony. Again, thank you for this 
opportunity to submit testimony before the Senate Interior 
Appropriations Interior Subcommittee. Please do not hesitate to contact 
me if I can provide further information regarding our requests on 
behalf of the Nez Perce Tribal Executive Committee.
                                 ______
                                 
  Letter From Bobby Whitefeather, Chairman, Red Lake Band of Chippewa 
                                Indians
                                       Red Lake, MN, March 7, 1997.
Hon. Bill Frist,
Public Health and Safety Subcommittee, Senate Labor and Human Resources 
        Committee, Dirksen Senate Office Building, Washington, DC.
    Dear Senator Frist: I thank you for the opportunity to provide 
written testimony on behalf of the Red Lake Band of Chippewa Indians on 
the Indian Health Service Budget for fiscal year 1998.
    The Indian Health Service (IHS) provides vital health care services 
to Red Lake Band members. Recent attempts by Congress to balance the 
federal budget, at the expense of the health care needs of the Red Lake 
people, has to stop. The continued downsizing and streamlining of the 
Federal government should not be at the expense of the IHS or the 
tribes. We demand that the IHS be spared from future cuts to balance 
the federal budget. We recommend that a separate line of funding be 
established and/or that additional dollars be earmarked for IHS to 
fully fund the health care needs as identified by tribes. If Congress 
cannot fund IHS at 100 percent of actual need, then they should 
authorize the $2.4 billion for fiscal year 1998 as recommended by the 
National Indian Health Board.
    The budget for the Indian Health Service continues to be identified 
as discretionary funding. We recommend that Congress acknowledge the 
IHS as a guaranteed annualized budget line item which is a result of 
treaties made between the United States Government and Indian Nations 
in which the federal government guaranteed health care to Indians in 
exchange for land, timber, minerals and other natural resources. Trust 
responsibility cannot be categorized as discretionary.
    We support the concept of Congress designating IHS as their own 
Department, separate from the Department of Health and Human Services 
or legislation that would elevate the IHS to the Assistant Secretary 
level within Health and Human Services. Either concept would eliminate 
unnecessary bureaucracy and reductions in the IHS budget.
    The concept of ``means testing, or taking into account tribal 
income when making federal appropriations,'' should not be allowed. 
Language needs to be restored that prohibits the billing of an Indian 
for health care based on the Ability to pay and Congress cannot use 
gaming revenues against tribes when funding health care. The health 
care of Indian people is a trust responsibility of the federal 
government and cannot be based on means testing, gaming revenues or 
financial status.
    The Indian Health Service receives funding for only 42 percent of 
the health care needs of Red Lake members. As a result, the Red Lake 
Indian Health Service Hospital and the Red Lake Tribe has had to rely 
on, and subsequently has become dependent on, collections from third 
party sources to provide health care for the Red Lake people. The 
majority of the Hospital's third party collections are from Medicaid, 
totaling almost $3.5 million dollars in fiscal year 1996. Third party 
collections now provide 25 percent of the operating budget at Red Lake. 
Medicaid collections should not be used as a means to reduce or not to 
increase the IHS budget. As Medicaid and welfare reform progress and 
third party collections decrease, we would expect the federal 
government to fund inevitable shortfalls. Medicaid reform proposals 
should include guarantees for full funding of Medicaid eligible Indians 
with a direct set aside for IHS and tribes that is not based on state 
caps.
    The Red Lake IHS Hospital and the Red Lake Tribe have effectively 
used these third party dollars to provide needed health services for 
the Red Lake people. Medicaid recipients at Red Lake are able to seek 
additional health services at other health care facilities throughout 
Minnesota when needed. They do not have to wait until funds are 
available through the IHS to get their health care needs taken care of. 
When Medicare and Medicaid recipients are referred to other health 
facilities, there is very little cost to the IHS. The facility where 
the receipts are sent, bill Medicaid for the services that they 
provide. As the Medicaid and Welfare Reform develops many of these 
people may no longer qualify for this benefit and will have to use the 
IHS Contract Health Services dollars where the priority system is used 
to determine who needs care now and who can wait. This will increase 
the rationing of health care to the Red Lake people. We would also have 
to decrease direct health care services to the people.
    One of the Red Lake Indian Health Service Hospital's major under 
funded cost of providing health care is Contract Health Services. This 
cost occurs when one of our tribal members is referred for additional 
medical services at off reservation private or public hospitals and 
health facilities. The Red Lake Hospital only receives $1 million 
dollars a year for this critical need. These dollars only last about 
six months of each fiscal year. The only reason the dollars last this 
long is that only life threatening emergencies are approved. Many of 
our Indian people are denied this service because their need to be 
referred to alternative and/or continued care is considered non-life 
threatening. They have to wait until the problem is life threatening 
and then it may be to late. Some of our members never get their health 
problem taken care of. It is outrageous and irresponsible of the 
federal government that Red Lake people needing alternative health care 
are frequently put on a waiting list, and only if their health problem 
is deemed life-threatening will IHS authorize services. One of the 
requirements when and before IHS authorize contract health services, 
Red Lake people, who are guaranteed health care, are frequently forced 
to apply for Medical Assistance in order to receive this service. This 
is an unnecessary burden and embarrassment for Indian people. Our 
Elders have dollars taken out of their small security checks to pay for 
their health care. They feel and we feel that this is wrong. Their 
health care was prepaid, they should not have to pay again. If IHS 
wants Medicare as a form of third party collection for our elderly then 
they should pay the premiums.
    According to the National Indian Health Board, IHS Contract Health 
Service needs are currently $20.6 million. We support the need for an 
increase in Contract Health Service dollars, Red Lake's request alone 
is an additional $5 million for fiscal year 1998. As Medicaid and 
Welfare Reform progress Contract Health Service dollars for Red Lake 
will increase up to $10 to $15 million dollars annually.
    We implore Congress to restore $104 million for mandatory cost 
increases to pay for the mandated pay act increases and the growing 
cost of inflation. These pay act increases should be equally 
distributed between IHS and Tribal Health Services.
    We need Congress to appropriate an additional 75 million for 
contract support costs. As we take over more functions of the federal 
government using Public Law 93-638, the Indian Health Service is 
informing Red Lake that there is no money for contact support. The Red 
Lake Band of Chippewa Indians should not have to bear the cost of 
administrating these services on behalf of the federal government.
    We implore Congress to reauthorize Public Law 102-537, The Indian 
Healthcare Improvement Act and provide the full funding needed to carry 
out the intentions of the Act. This Act is critical to the continued 
success of the tribes and the IHS in providing healthcare. The major 
problem with the act is that not all programs and services identified 
in the Act were funded.
    Congress needs to appropriate dollars for Indian Health Service to 
provide for elders needing short term and long term care in skilled 
nursing or extended care facilities. The authorization is in the Indian 
Healthcare Improvement Act for Indian Health Service to provide skilled 
nursing care, but, they say there was no dollars that were appropriated 
for this purpose. We have operated our own 47 bed Extended Care 
Facility since 1989. Our facility is added on the Red Lake IHS-PHS 
Hospital and was built on the premise that we would be 100 percent 
reimbursed by the federal government. This happened for about the first 
8 months of operation, then Indian Health Service informed the State 
that in their opinion we were not a ``facility of the service''. Since 
that opinion we have not been able to collect the 100 percent 
reimbursement from the federal government.
    The Red Lake Tribal Council, has worked extensively over the years 
to acquire funding for our unique and culturally sensitive programs 
that treat drug, alcohol and other forms of substance abuse. We need 
these services to continue and we do not want to have the dollars that 
we have used to operate these services reprogrammed by the federal 
government and given to the States for the general population. We need 
more dollars and a separate set-aside allocation specifically for 
tribes. Our share of the set aside could come directly to the Red Lake 
tribe as a federal block grant, or it could be administered by the IHS 
and come directly to tribes through our Public Law 93-638 Programs.
    We direct your attention to the fact that our Red Lake Indian and 
Free Drug Program, which was established in 1973, continues to be 
funded as a direct block grant and that this is the only federal funded 
block grant in the United States that goes directly to an Indian tribe.
    The Red Lake Chippewa Nation has given up land, minerals and other 
natural resources as a prepayment for health services. We refuse to be 
identified as part of the minority population or a special organization 
or people of color that receives health care. We are a Nation. We 
cannot support Federal or State Health Care Reforms if they threaten 
our sovereignty and ignores or relieves the federal government of its 
treaty obligations and trust responsibilities and the government-to-
government relationship between the Red Lake Band of Chippewa Indians 
and the United States
    Government or authorizes State's control over tribes in providing 
health care.
    We need you to support the Tribes and fully fund the Indian Health 
Service budget, protect our prepaid health services and to remind those 
that feel that the IHS is a welfare program that it is not. Indian 
Health Care is based on the trust responsibility of the federal 
government and that Congress has the legal obligation to provide these 
benefits to Indian Nations, regardless of the tribes or individual 
American Indians financial status.
            Respectfully Submitted,
                                        Bobby Whitefeather,
                                                          Chairman.
                                 ______
                                 

   Prepared Statement of the Indigenous People's Council for Marine 
                                Mammals

    Mr. Chairman Gorton, Members of Interior and Related Agencies and 
the Senate Subcommittee of the Appropriations Committee. On behalf of 
the Alaska Native Community, the Indigenous People's Council for Marine 
Mammals (IPCoMM) is requesting the Senate Subcommittee of the 
Appropriations Committee to appropriate, for fiscal year 1998, $750,000 
to the Secretary of Interior to implement Section 119 of Public Law 
103-238, 1994 Amendments to the Marine Mammal Protection Act (MMPA). It 
is our understanding the Congressional add-on of $250,000 for fiscal 
year 1997 will be continuing appropriations to the Department of the 
Interior in future years. Section 119 authorizes the Secretary of 
Interior to * * * ``enter into cooperative agreements with Alaska 
Native Organizations to conserve marine mammals and provide management 
of subsistence use by Alaska Natives.'' It also authorizes Congress to 
appropriate $1 Million annually for fiscal years 1994-99 to implement 
Section 119. The only funding provided since 1994 was a $250,000 
congressional add-on to the Department of the Interior's fiscal year 
1997 budget which allowed U.S. Fish and Wildlife Service (USFWS) to 
enter into co-management agreements with Alaska Native Organizations 
for conservation and subsistence use of walrus, polar bears and sea 
otters.
    Despite the lack of funding, significant progress has been made in 
Alaska in terms of implementing Section 119 of the MMPA. The Alaska 
Native Community, represented by IPCoMM, the Alaska Federation of 
Natives (AFN), and the Alaska Inter-Tribal Council (AI-TC) recently 
completed negotiations on an umbrella ``Memorandum of Agreement for 
Negotiation of Marine Mammal Protection Act Section 119 Agreements'' to 
conserve marine mammals and provide co-management of subsistence use 
with the Department of the Interior--Fish and Wildlife Service. Final 
negotiations with the Department of Interior was completed on March 5, 
1997. This umbrella agreement between IPCoMM and USFWS will provide the 
foundation and direction for how individual co-management agreements 
will be negotiated between the federal agencies and Alaska Native 
Organizations for the three (3) species under USFWS jurisdiction. The 
parties are in the process of planning a formal signing ceremony to 
commemorate the historic agreement which will enhance the conservation 
and utilization's of the marine mammal resources for subsistence uses 
consistent with the public policy embodied in Section 119 of MMPA. In 
addition, to the successful negotiations with NMFS and USFWS on the 
umbrella agreement, three Marine Mammal Commissions (Eskimo Walrus 
Commission, the Alaska Nanunq Commission and the Alaska Sea Otter 
Commission) recently signed individual co-management agreements with 
the USFWS for specific co-management agreement activities involving 
three species used for subsistence purposes in Alaska (walrus, polar 
bear and sea otters). These Agreements were made possible due to the 
$250,000 appropriation to the Department of the Interior for fiscal 
year 1997.
    Although significant progress has been made in implementing Section 
119 of the MMPA, it is imperative that Congress fully fund Section 119 
of MMPA if this progress is to continue for the three (3) marine mammal 
species used by Alaska Natives. Congress has recognized that the best 
way to conserve and wisely utilize marine mammal resources used for 
subsistence purposes is to allow the full and equal participation by 
Alaska Natives in decisions affecting the management of marine mammals 
taken for subsistence. That can only happen if Congress provides 
adequate funding for co-management activities.
    Background.--Early in the discussions leading to the 1994 
reauthorization of the Marine Mammal Protection Act, a number of Alaska 
Native Marine Mammal groups banded together and formed the Indigenous 
People's Council for Marine Mammals (IPCoMM) to insure a united Native 
voice during the reauthorization process As a result, the Native 
exemption for taking of marine mammals for subsistence uses was 
retained, and language was added in Section 119 to authorize the 
Secretaries of the Department of Commerce and Interior to enter into 
co-management agreements with Alaska Natives Organizations for the 
conservation and co-management of subsistence uses of marine mammals
    In the spring of 1994, Congress enacted Public Law 103-238, the 
1994 amendments to the Marine Mammal Protection Act. In doing so, 
Congress expressed its intent that the Secretary of Commerce and the 
Secretary of the Interior extend full cooperation as partners to Alaska 
Native Organizations in the development and implementation of marine 
mammal management plans. In order to insure proper implementation of 
Section 119, the Alaska Native Community requested that NMFS and USFWS 
work with IPCoMM in the development of an ``Umbrella'' Agreement with 
specific language that the federal agencies would consider when 
developing individual co-management agreements with Alaska Native 
Tribes and organizations pursuant to Section 119. The purpose of the 
umbrella agreement is to provide the direction and foundation for 
individual co-management Agreements. It will serve as a guide to the 
Fish and Wildlife Service (USFWS), National Marine Fisheries Service 
(NMFS) and Biological Resources Division, Geological Survey (USGS) when 
these federal agencies enter into individual agreements with Alaska 
Native Organizations or Alaska Native Tribes for the co-management of 
subsistence use of marine mammals.
    At this time IPCoMM is concerned about all marine mammals which are 
utilized by Alaska Natives, however harvest limitations are allowed and 
discussions have taken place concerning three listed species for which 
we have grave concern; bowhead whale (endangered), North Pacific Fur 
Seal (threatened), Steller Sea Lion (threatened).
    The Alaska Native Community stands ready to work with USFWS and 
NMFS in implementing Section 119 of Public Law 103-238 to its fullest 
extent. It has already made significant progress toward that end. While 
Section 119 provides an effective way for Alaska Natives to participate 
in decisions affecting the management of marine mammals taken for 
subsistence, full realization of that goal will not be possible unless 
Congress provides adequate funding for co-management agreements. For 
that reason, we urge this Committee to appropriate $750,000 to the 
Department of Interior to enable it to enter into individual co-
management agreements pursuant to Section 119 of the MMPA. We trust 
that our request will be given due consideration during the 
deliberations of the Committee.
                                 ______
                                 

  Prepared Statement of John Blackhawk, Chairman, Winnebago Tribe of 
                                Nebraska

    This testimony addresses the fiscal year 1998 budget and 
appropriations for the Bureau of Indian Affairs and the Indian Health 
Service. The Tribe is concerned about funding for the Tribal Priority 
Allocation program and the Tribally Controlled Community Colleges 
program within the BIA and about funding needs at the IHS.
    The Tribe and Economic Development.--The Winnebago Tribe of 
Nebraska is a federally recognized Indian Tribe organized pursuant to 
Section 16 of the Indian Reorganization Act of June 18, 1934. Our 
forefathers were forcibly relocated from lands in and near what is now 
the state of Wisconsin. Our Treaty of 1865 is the first in history to 
require that the United States provide health care services to tribal 
members. The Tribe's 120,000-acre reservation includes lands in both 
Iowa and Nebraska and only about 30,000 acres of land within the 
reservation is now tribally controlled. There are 3,780 enrolled 
members, of whom about 1,150 reside on the reservation.
    The Winnebago Tribe of Nebraska is very active on the economic 
front. The Tribe operates several business enterprises, including the 
WinnaVegas Casino in Sloan, Iowa, and the Heritage food store and the 
Company A Convenience Mart, both in Winnebago, Nebraska. Additionally, 
the Tribe has developed a small strip mall located on the reservation; 
added tribal revenue is generated by leasing tribal land to outside 
agricultural interests. Ho-Chunk, Inc., a wholly-owned tribal 
development corporation, owns a Rodeway Inn in Sloan, Iowa, 
approximately 3 miles from the Tribe's casino. Ho-Chunk has also opened 
hotels in Omaha and Lincoln. Even with the economic contribution of 
these projects, tribal per capita income remains significantly below 
the poverty level at just over $5,000.
    Unlike states, the tribes have little or no tax base or other 
revenue sources with which to operate tribal government programs. 
Gaming has given a jump start to our economy but those revenues are 
decreasing because of commercial competition. The Tribe still relies 
heavily on federal funds to provide even the most basic level of 
services to tribal members.
                        bureau of indian affairs
    Tribal Priority Allocation (TPA) Program.--Under the BIA's TPA 
program, the Tribe contracts to operate aid to tribal government, 
judicial services, employee assistance, higher education, credit, law 
enforcement communications, real estate services related to land 
management, and wildlife and parks. The total 1997 TPA master contract 
was $817,500, a decrease of $42,000 from the contract amount for 1996 
which was $866,000; the Tribe supplemented this amount with $380,259 
from tribal gaming revenues. In the 1998 budget, the Administration 
requests $889,000 for the Winnebago Tribe TPA, an increase of just 
$23,000 from 1996, and $71,500 from the current year level.
    Aid to tribal government funds three positions, an 
intergovernmental liaison person and 2 receptionists to assist the 
Tribe's administrative functions. We have significantly cut back on 
this function to make more money available for direct services which 
are sorely needed. For example, the judicial services program averages 
500 cases a year; since October, 1996, our court has received 402 new 
civil, criminal, juvenile, family and traffic cases. The Tribe needs 
funds for court automation. Because we have only one probation officer 
for all adults and juveniles, we are unable to monitor compliance with 
court orders. We are also having difficulty in enforcing child support 
orders simply because we do not have the necessary staff. The Tribe 
needs at least another $55,000 for judicial services. The Tribe's 
Supreme Court which hears all appeals is funded entirely by the Tribe.
    The Tribe uses the real estate services function to help locate 
homesites for tribal members, many of whom own fractional interests in 
larger pieces of land. The program is also responsible for ensuring 
that trust and fee land is managed in accordance with environmentally 
sound practices to guarantee a solid future for generations to come. 
The funds are sufficient to hire a program director and administrative 
assistant to assist the land consolidation process. The Tribe pays for 
a lease monitor for the Tribe's agricultural lands from tribal funds. 
The TPA-contracted social service program is also underfunded and pays 
for only one director and one caseworker to service all of the Tribe's 
welfare caseload. Children with behavioral and/or emotional problems 
are sent to a detention center off the reservation because we do not 
have services on the reservation for them. The center is about an hour 
away and, while the facility does allow the Tribe to provide services 
for tribal children, there are rarely sufficient funds to provide the 
kinds of services the children need. There is a significant need to 
enhance prevention programs aimed at this group. Most state and federal 
programs focus on treating symptoms, leaving the tribe responsible for 
funding and implementing prevention.
    The Tribe is reorganizing the social service program to try to 
realize more benefit from the dollars expended. For example, people are 
often referred to different places for needed services. We are 
implementing a more holistic approach to stretch dollars by making sure 
that as a condition for income support, the individual enrolls in 
treatment, if needed, or job training, if needed, or both. In other 
words, we hope to consolidate all referrals so that money, time and 
energy will be saved. This is difficult to do as federal and state 
funds are extremely compartmentalized and laden with bureaucratic red 
tape.
    The wildlife and parks program funds three conservation officers 
and one part-time biologist. Without them, there would be no law 
enforcement for hunting on the reservation. The Tribe has an agreement 
with the State of Nebraska whereby the Tribe monitors and manages the 
reservation wildlife. We must maintain at least the current level of 
funding for this vital governmental program.
    The Tribe is very supportive of the increases shown in the 
President's budget request for the TPA account and strongly urges the 
Subcommittee to recommend these increases or even higher levels if 
possible. While these increases won't meet the full need, they will 
prevent us from slipping further behind. We cannot function at the most 
basic level of services if more cuts are made: in 1996 we lost 16 
percent from 1995 levels, and in 1997, we lost over 5 percent from the 
1996 level of $866,000. While the Tribe has been able to supplement TPA 
federal funding with gaming revenues, the opening of non-Indian 
competitive gaming has caused these revenues to decrease significantly. 
Given the dual hit caused by depletion of gaming revenues and 
reductions in federal funds, coupled with an increasing reservation 
population--more children and people living longer--we are in for some 
very hard times.
    Other BIA Contracts.--For the Subcommittee's information, the Tribe 
has separate contracts for other programs, including Indian Child 
Welfare, Johnson-O'Malley, Social Services, and Water Resources. We 
supplement all but the ICWA program with $124,000 from gaming revenues. 
We also have a contract to maintain Bureau of Indian Affairs offices 
and employee quarters and receive road maintenance funds which the 
Tribe matches ($40,234).
    Tribally Controlled Community Colleges.--The President's budget 
requests an increase of $3,000,000 for this vitally needed program. The 
Winnebago Tribe formerly participated as a member of a Nebraska 
Intertribal Consortium in establishing the Nebraska Indian College. 
Last year, for various good reasons, the Tribe elected to go its own 
way and is now operating Little Priest Tribal College. We are very 
pleased with the first year of operations and hope to become a 
candidate for accreditation in the very near future. This means that 
while we lost our eligibility for funding in the current year, in 
fiscal year 1998, the new College will probably be participating in the 
formula distribution of funds to tribal colleges based on Indian 
student count.
    As the members of the Subcommittee are aware, the current 
distribution to colleges on the basis of per student count is less than 
$3,000. The authorized amount if $5,820 per student. No other 
government funds its college on so low a per student basis. The average 
for public colleges is about $4,500.
                         indian health service
    The Tribe's community health programs, including CHRs, Public 
Health Nursing (PHN), National Child Health (NCH), Health Education, 
and the Diabetes and Podiatry programs, have positively impacted tribal 
preventive health efforts. For example, amputations have decreased, 
immunizations have increased, and infant mortality and morbidity rates 
are declining. The Tribe has proven its ability to plan, develop, and 
implement outreach programs but we desperately need trained staff to 
provide services.
    The dental program has been extremely successful in educating and 
providing early treatment which is vital in a community plagued with 
diabetes. One dentist averages between 200-225 appointments per month.
    The PHN program averages about 2,000 patient contacts per year and 
coordinates an additional 1,500 contacts for patient care. This level 
of service is provided by 2 RNs and 2 assistants. The Public Health 
Nurses provide Maternal Child Health outreach for over 200 clients each 
year--reaching 80 percent in the first trimester. This work has 
resulted in a significant reduction in fetal deaths and an increase in 
live births without serious complications. The Tribe's immunization 
clinics and outreach has exceeded our goal of reaching 60 percent of 
the eligible population by 8 percent (reaching 68 percent).
    Mammography and cervical cancer screening programs were initiated 
in 1994, and tribal staff have worked hard to provide cost-free 
services to all eligible clients. This has significantly reduced the 
more costly treatment of advanced cancers and increased life expectancy 
for tribal members.
    Health care for American Indian and Alaska Native (AI/AN) people 
must be guaranteed through an amendment to Title XIII (Medicare) of the 
Social Security Act. Treaties initiated by the federal government 
obligated this nation to provide health care, education, and protection 
services in exchange for the very lands upon which this nation now 
resides. The existing appropriation for AI/AN programs has never been 
adequate to meet the health care needs of our people. Historically, 
only 75 percent of IHS level of need has ever been funded. This has now 
eroded to 40 percent and is still dropping which is directly 
attributable to Tribal ``compacting'' under Public Law 100-713 (and its 
subsequent amendments) and NO program increases. There is a very real 
risk that decreased access to needed health care is imminent as well as 
a set-back for the advancements thus far made by IHS.
    The legislation also mandated that there be ``no adverse impact'' 
for ``non-compacting'' Tribes, it also mandated a report be submitted 
on this critical issue. To date we have not seen that report! Even 
though not a single Tribe in the Aberdeen Area, who all have Treaties, 
has elected to compact, we have suffered cutbacks directly related to 
this legislative process. The Aberdeen Area is notorious for its high 
infant mortality rate: 18.5 percent per 1,000 live births versus the 
national level of 14.5 percent (it's a victory when a newborn lives 
beyond the age of three!), high morbidity rate, and high incidence of 
diabetes. These conditions will only worsen under the policies and 
practices of the current director of IHS. We understand that he 
succumbed to pressure by the ``compacting'' Tribes and authorized that 
they be funded at 100 percent of their level of need at a great 
sacrifice to the ``non-compacting'' Tribes as well as to IHS! We demand 
that this issue be investigated and that the IHS Director be held 
accountable for his abuse and neglect of duty and power, and that the 
mandated report on ``adverse impact'' to ``non-compacting'' Tribes be 
immediately undertaken.
    Our Service Unit's budget supports only 71 positions out of an 
authorized 163. They are mandated to collect third party resources to 
augment operational costs. In fiscal year 1996 our local service unit 
collected $135,000 out of their mandated amount of $185,000. The 
national projection for third party resources was set at an unrealistic 
amount of $4 million. Although additional resources are used to augment 
critical operational shortfalls, this optimistic but deceptive 
methodology must be realistic and based on historical collections and 
data.
    IHS's goal is to raise the health status of AI/AN people to the 
highest possible level. We quote from a recently published paper 
written by Everett Rhoades, MD, former director of IHS: ``[A]t first 
glance (the goal) appears to be abstract and platitudinous. It has 
consistently proven otherwise. On the contrary, it includes the 
extremely important concept of community-oriented preventive, as well 
as curative, care. It is a concept that the country should immediately 
adopt as it struggles with new approaches to health care for the 
nation.'' Notwithstanding IHS's flaws, AI/ANs have long known this 
approach to be efficacious and cost effective. The Tribe strongly 
suggests that the Congress use it as a prototype for the rest of the 
nation in your health care reform strategy, and that you call upon our 
cooperation and experience in developing your strategy.
    We're curious about the GAO's 1995 study on ``Issues Related to the 
Need for the Public Health Service's Commissioned Corps.'' We 
understand that substantial savings, estimated at roughly $1 billion, 
could potentially be realized by converting this quasi military group 
to civilian employees. The PHS Corps has the same benefits as the armed 
military without the risk. Even though they wear an officer's uniform, 
they are performing civilian jobs and will never see combat. They don't 
pay taxes on subsistence and housing allowances and are entitled to 
other types of tax exclusions; they don't keep track of hours on the 
job; and they don't pay for health care. Even without being privy to 
the GAO study, we recommend that the PHS Corps be converted to the work 
force of tax paying civilian employees, and that the savings be 
redirected to local IHS hospitals and clinics serving AI/AN country, 
Tribal ``638'' contractors, and especially to the Community Health 
Representative (CHR) program. Resources that now support one PHS Corps 
officer could support 3 to 5 CHRs who work at the grassroots level 
promoting health and preventing disease as well as support for their 
program operations. Thank you.
                                 ______
                                 

  Prepared Statement of David M. Gipp, President, and Russell ``Bud'' 
         Mason, Board Chairman, United Tribes Technical College

                           summary of request
    United Tribes Technical College (UTTC) \1\ and its board of 
directors submits this testimony regarding the fiscal year 1998 BIA 
appropriations for our institution. We want you to know of the success 
of UTTC in moving Indian families into self-sufficiency and why we 
deserve the continued support of this Subcommittee.
    United Tribes Technical College, which is chartered by the five 
tribes in North Dakota, is a ``full service'' postsecondary vocational 
education institution--we provide vocational education services for 
adults, run a nursery, pre-school and elementary school for the 
children of our adult students, and operate a dormitory system and a 
health clinic. We believe that this community setting has a great deal 
to do with the success of our students--students who, by and large, 
come from impoverished homes and communities.
    The UTTC fiscal year 1998 request is for a $728,000 increase over 
the fiscal year 1997 enacted level, consisting of the following: (1) 
$86,000 for personnel costs; (2) $250,000 to improve facilities for 
computer technology, (3) $200,000 to improve course offerings and 
student services, and (4) $192,000 for emergency maintenance and 
facilities. A $728,000 increase would bring the UTTC funding in the BIA 
budget to $2,538,000.
                       funding history/shortfalls
    BIA funding for UTTC has not even come close to meeting basic cost-
of-living increases. From fiscal year 1990 through fiscal year 1997, 
BIA funding for UTTC has increased only 1.06 percent (from $1,708,000 
in fiscal year 1990 to $1,810,000 in fiscal year 1997). The operating 
and purchasing strength of our budget has diminished by some 20 percent 
since 1991. As described the section of this testimony regarding our 
need for personnel funding, our faculty and staff receive salaries that 
are lower than even the lowest paid faculty in any state college 
system.
    While our funding has remained flat since fiscal year 1990, our 
expenses have increased. The College has experienced a large increase 
in the cost of utilities, with electricity expenses rising about 20 
percent per unit and the per unit gas cost increasing approximately 113 
percent. Over the years the College has been able to partially offset 
utility rate increases by implementing stringent conservation measures 
such as improved weatherization and reductions in building 
temperatures. However, energy consumption cannot be further reduced 
because of the College's location and the harsh winters in the northern 
plains.
    Lack of available resources has also meant a limitation on the 
repair and maintenance of physical facilities. The College occupies the 
old Fort Lincoln Army Post. Other than the more recently constructed 
skills center and part of the community center, UTTC's core facilities 
are 80 to 90 years old. Estimates for new facilities total over $12 
million, according to a 1993 U.S. Department of Education report to 
Congress. Continuing a course of nonrepair will ultimately prove more 
costly as the repairs will be greater. This is especially true of the 
water and sewage systems on campus. Fire and safety reports document 
these needs. Neither UTTC nor other tribal colleges are included in the 
BIA Facilities budget through the Office of Construction and 
Management.
    Finally, the fixed and related costs approved under our annual 
Indirect Cost proposal to the U.S. Inspector General have decreased in 
recovery by over $100,000 annually (fiscal year 1996), with another 
possible loss of $110,000 for fiscal year 1997. We are in dire need of 
adequate recovery for this year, as well as prior years.
            the record of uttc and the need for our services
    At United Tribes Technical College most of all our students receive 
some form of public assistance. Yet we have a job placement rate of 80 
percent--a record sustained over the past 10 years. This is well above 
the job placement rates required in the Personal Responsibility and 
Work Opportunity Reconciliation Act of 1996 (Public Law 104-193). Our 
calculations show that a UTTC graduate pays back in taxes over a 6.4 
year period the costs of receiving an education at our institution.
    The enactment last August of welfare reform legislation makes the 
work of UTTC even more critical. We want to be a full partner in moving 
Indian families into jobs with living wages, but as it stands now we 
have to turn away students due to lack of institutional resources. We 
do no recruiting at UTTC, but yet we have a current waiting list of 
about 200 students who want to attend our institution. Some potential 
students do not apply, knowing of the waiting list.
    Our 300+ students come from all over Indian country--some years we 
have students representing 45 tribes. A large proportion of our 
students are from the 14 tribes in North Dakota and South Dakota. 
Indian people in the Dakotas, as you know, have enormously high jobless 
rates. BIA Labor Force data reports unemployment rates among Indian 
people on and near reservations at 50 percent and 59 percent in North 
Dakota and South Dakota, respectively. Of Indian people on and near 
reservations in South Dakota who are employed, only 17 percent earn 
over $7,000. The comparable figure in North Dakota is 19 percent.
    As far as we are concerned, we would be justified in asking for a 
very large budget increase--based our success rate, based on need, and 
based on the financial return which comes from an educated and employed 
population.
              additional information on our budget request
    While we would like to ask for funding to meet our construction 
needs, we are realistic enough to know that such funding is simply not 
in the cards for fiscal year 1998. We are limiting our request for a 
$728,000 increase over the fiscal year 1997 level for a total of $2.5 
million. The funding would be utilized for the following purposes, all 
of which have been identified through accreditation ageney visits and 
observations:
    $86,000 for costs of staff and faculty ($44,000 over the BIA 
request). The request we make would provide a 4 percent salary and 
fringe benefit increase. Our staff and faculty work for considerably 
lower compensation compared to other similar institutions. We are at a 
critical juncture, and face an eminent risk of losing qualified, 
capable staff and faculty due to low salaries. The dedication of our 
staff cannot sustain them indefinitely.
    North Dakota salaries for higher education faculty rank 50th--the 
lowest in the nation--but the average faculty salaries at UTTC are 
lower even than those in the North Dakota state system.\2\ The average 
faculty salary at UTTC is $24,476, while the average faculty salary at 
the community colleges in North Dakota range from $29,900 to $32,800. 
This translates to our faculty receiving an average salary which ranges 
from $5,500 to $8,400 less than their peers at neighboring community 
colleges. Salaries for non-faculty staff would show a disparity at 
least as wide as that for faculty. Unlike most federal and private 
institutions which are able to provide salary increases to employees 
based on the length of service (unrelated to cost of living increases), 
UTTC does not have the financial ability to provide a guaranteed system 
of incremental salary increases based on length of employment.
    $250,000 to improve facilities for computer technology, life 
science laboratories, and building trades.
    $200,000 to improve course offerings and student services. This 
funding would allow hiring/training of faculty so that existing 
programs can be improved to meet new market demands. For example, we 
want to expand the allied health professions program and also to expand 
the business clerical program into the business administration area.
    In the area of student services, we want to expand our diagnostic 
capabilities in tribal-specific areas and also in the areas of literacy 
and math-science deficiencies. This will allow us to provide better 
remidiation services to students. Finally, we want to make improvements 
in our student follow up, career development, and job market research 
efforts. While $200,000 is inadequate to meet all these needs it would 
allow us to make progress in some of these areas.
    $192,000 for emergency maintenance on both single and family 
student housing, instructional facilities, and support facilities. This 
amount will obviously not cover major renovations or new facilities.
                             uttc services
    United Tribes Technical College offers ten (10) Certificate and ten 
(10) Associate of Applied Science degree programs.\3\ Entrepreneurship 
and new technology skills are being integrated into appropriate 
curricula. All programs are accredited through the North Central 
Association of Colleges and Schools at the certificate and two-year 
degree granting levels.
    We also provide institutional services that are fundamental to the 
delivery of quality vocational education, including those related to 
its residential nature. These services include:
    Adult education for students needing advanced basic education 
skills or who desire to pursue vocational programs requiring GEDs or 
high school diplomas;
    Academic instruction which allows our graduates who wish to pursue 
additional college education a sufficient background;
    Instructional supplies and equipment for all vocations;
    Services including student housing, cafeteria, local student 
transportation, library, financial aid office, counseling and 
placement, facilities maintenance, and overall administrative and fixed 
costs for UTTC's 105 acre campus base;
    Early childhood (nursery and pre-school) services for approximately 
100 children, ages 8 weeks to five years. Nearly half of these children 
are under age two, and so the staff to child ratio of necessity is very 
high in order to provide proper supervision and to meet the North 
Dakota licensing requirements;
    The Theodore Jamerson Elementary School (K-8th grades) serving over 
100 Indian students;
    Modest offering of cultural, athletic, and recreational activities 
to supplement student learning experiences and campus-based family 
services.
    UTTC's enrollment now averages 300 students annually. Combined with 
family members and our pre-school and elementary students, the UTTC 
campus population exceeds 500. Our students represent as many as 45 
different Indian Nations and 15 states. The majority of the students 
have never spent more than one continuous year away from their home 
reservations. They have also experienced chronic unemployment due to 
the extremely depressed local economy and to education limitations 
which are well below the national average.
    Thus, UTTC is committed to not only its post-secondary mission, but 
to the economic, social, and cultural advancement of American Indian 
and Alaska Native people. The mission of UTTC is to provide an 
environment where students and staff can preserve and transmit 
knowledge, values, and wisdom to ensure the survival of native people 
and Indian Nations along with the vocational training and job placement 
of native students. There is no other post-secondary vocational 
education institution in the country that in a residential setting is 
Tribally-controlled, culturally-based, family-oriented, and focused on 
both Tribal economic needs and mainstream employment training.
    Thank you for your consideration of our request. We need your 
assistance to ensure that the unique educational opportunities offered 
by United Tribes Technical College will be available for what we hope 
will be an increasing number of Indian and Alaska Native students and 
their families next year and in the future.
                                endnotes
    1. Established in 1969, United Tribes Technical College is a 
unique, inter-Tribal vocational technical education institution located 
on a 105 acre campus in Bismarck, North Dakota. The Tribal college is 
owned and operated by five federally-recognized Tribes situated wholly 
or in part in North Dakota. These Tribes are the Devils Lake Sioux 
Tribe, the Sisseton-Wahpeton Sioux Tribe, the Standing Rock Sioux 
Tribe, the Three Affiliated Tribes of the Fort Berthold Reservation, 
and the Turtle Mountain Band of Chippewa. Control of the institution is 
vested in a ten-member board of directors comprised of elected Tribal 
chairpersons and Tribal council members.
    2. Source: Integrated Postsecondary Education Data Systems (IPEDS) 
Report of the U.S. Bureau of the Census and the Department of Education 
Office of Education Statistics.
    3. The following Certificate Programs are offered: Administrative 
Office Support, Automotive Service Technician, Building Trades 
Technology with options in Carpentry, Electrical, Plumbing, and 
Welding; Early Childhood Education; Criminal Justice; Hospitality 
Management: Food & Beverage Specialization; Medical Secretary.
    The following Associate of Applied Science (A.A.S.) degrees are 
offered: Arts/Marketing; Automotive Service Technology; Building Trades 
Technology with options in Carpentry, Electrical, Plumbing, and 
Welding; Criminal Justice; Early Childhood Education; Health 
Information Technology; Hospitality Management: Food & Beverage 
Specialization; Office Technology with emphasis in Computer 
Applications or Accounting; Practical Nursing; Small Business 
Management.
                                 ______
                                 

  Prepared Statement of the National Indian Child Welfare Association

    The National Indian Child Welfare Association \1\ submits this 
statement on those portions of the fiscal year 1998 Bureau of Indian 
Affairs budget concerning the Indian Child Welfare Act programs--the 
Indian Child Welfare Act (ICWA), Title II grant program under the 
Tribal Priority Allocations (TPA) budget category and the ICWA, Off-
Reservation program which was funded through fiscal year 1996, but is 
not identified in the Administration's request for fiscal year 1998.
---------------------------------------------------------------------------
    \1\ The National Indian Child Welfare Association is based in 
Portland, Oregon and provides a broad range of services to its 
constituents. These services include, (1) professional training for 
tribal and urban Indian child welfare professionals; (2) consultation 
on social service program development; (3) facilitating by request 
child abuse prevention efforts in reservation communities; and (4) 
analysis and dissemination of policy information that impacts Indian 
children and families. Our constituents consist of tribal governments 
and urban Indian child welfare programs throughout the United States. 
Our organization works closely with the Affiliated Tribes of Northwest 
Indians and National Congress of American Indians, as well as having 
members on the Indian Child Welfare Committees of both organizations. 
This will be our fifth year in providing written testimony to this 
Subcommittee.
---------------------------------------------------------------------------
    Our organization is requesting that the Subcommittee:
    (1) Recommend an increase to TPA similar to the Administration's 
fiscal year 1998 request so that additional funding would potentially 
available to assist tribal ICWA programs;
    (2) Recommend an increase of $2 million in the Special Programs and 
Pooled Overhead category for the express purpose of restoring historic 
funding for the Off-reservation ICWA grant program; and
    (3) Require the BIA to utilize additional data in developing its 
budget request regarding ICWA services and to provide this data to 
Congress. We have listed on page two of our statement the types of data 
we believe should be utilized in this process.
          the bia does not measure tribal child welfare needs
    Under TPA tribes are essentially provided a block grant from which 
they must fund a broad variety of services. Under this system tribes 
must make decisions about which services they can fund and at what 
level. However, many times tribes encounter situations when they must 
transfer funding from one financially strapped service to another, even 
though both services are overwhelmed by the human need they face. The 
BIA looks at this transfer as a measure of decreased need, which they 
use when developing its budget request. This measure does not take into 
consideration any information on human need. Under this method, 
Congress and the Administration will never know what the actual need 
for any program under TPA is and how well funds being allocated are 
doing in trying to meet that need.
    Data provided to Congress should accurately describe human need not 
just budget priorities. Amazingly, the BIA has been allowed to provide 
only superficial data to justify budget requests and evaluate their 
performance in the area of human services. To our understanding, no 
other federal agency that administers human services funding is allowed 
to provide such incomplete information to Congress. The BIA should be 
held to no less of a standard.
    Another important factor in determining the need for ICWA program 
funding is tribal access to other program services and funding. Of the 
top four federal sources of child welfare funding guaranteed to states 
under the Social Security Act, tribes only have guaranteed access to 
one, Title IV-B Child Welfare Services, and the amounts of funding 
available from this source for tribes are extremely limited 
(approximately $5.0 million projected for fiscal year 1998). This 
situation combined with dwindling state resources, lack of expertise, 
and states reluctance to provide community-based services in Indian 
communities based on financial and jurisdictional issues, has created a 
serious crisis for tribes in their efforts to protect their children 
and establish permanency and stability for those children who need 
help. Funding from the ICWA, Title II grant program is the only viable, 
ongoing source of child welfare funding for all tribes. Without strong 
ICWA programs tribes have few options available to them to protect 
their children from child abuse and help them secure a safe, permanent 
home.
                      tribal icwa, title ii grants
    Until fiscal year 1995 with the revised Final Rule for the Indian 
Child Welfare Act, Title II grant program taking effect, Tribes have 
been forced compete for child welfare funding from year to year. This 
competitive process has been extremely disruptive and in most years 
only allowed approximately 50 percent of the tribes nationwide to 
receive any ICWA funding. Improvements in the grants process and 
increases to funding have enhanced tribal access to this resource, but 
there is still a need to continue the effort to make ICWA funds more 
available and reflective of tribal needs. These efforts must include:
    A more careful analysis of the child welfare needs for tribes by 
the BIA for the purposes of budgetary recommendations. This analysis 
should be based on more than just population figures and how tribes are 
able to prioritize their limited Tribal Priority Allocation funds. Data 
should be provided on: types of services provided; number of children 
and families to whom services were provided; number of out-of-home 
placements of children; average length of time children are in out-of-
home care; numbers of children who are able to receive permanence 
through reunification, guardianship kinship care, or adoption.
    Funding increases for the tribal portion of ICWA, Title II that 
reflect need as identified through careful analysis of several factors, 
such as access to other child welfare funding, relative costs of 
providing basic child welfare services on tribal lands, and needs data 
identified in the paragraph above. This is data that is routinely used 
with other federal child welfare programs and provides Congress with 
meaningful data that can define need.
    Current estimates provide a picture of need that is clearly as high 
as that of any ethnic group for these services. The most recent 
research on risk assessment of child abuse for Indian children 
indicates that 34.4 percent of Indian children are at risk for being 
abused (1993 National Indian Justice Center study on Indian child 
maltreatment funded by the Indian Health Service). In 1986, the most 
current year for which data is available, it was reported that Indian 
children were placed in substitute care at a rate that is 3.6 times 
that of non-Indian children (1988 study entitled, ``Indian Child 
Welfare: A Status Report.'' Funded by the Departments of Health and 
Human Services and Interior). Many other documented indicators of the 
need for these services are also highly visible in many Indian 
communities such as extreme poverty and high rates of substance abuse.
                 off-reservation icwa, title ii grants
    Off-reservation programs can provide a number of important services 
to tribes, states, and individual Indian children and families. The 
ICWA does not make a distinction between who should benefit from the 
Act, and is designed to protect Indian children and families 
everywhere. These off-reservation programs, where they have been able 
to exist, can provide key linkages to tribes when their members become 
involved in state child welfare systems, all of which are designed to 
meet the purpose of the Indian Child Welfare Act. Common services that 
these programs can provide include:
    Monitoring compliance with the Indian Child Welfare Act in urban 
areas;
    At the request of tribes, provide case advocacy or other services 
such as foster care to tribal children who do not live on the 
reservation and whose tribe may not even be in the state;
    Provide training to state administrators, child welfare workers, 
and court personnel on how to improve compliance with the Indian Child 
Welfare Act and provide more cost-effective services;
    Recruiting and licensing Indian foster and adoptive families, an 
activity that states often do not have resources for and at which they 
are not successful.
    Off-reservation programs have suffered from the instability of 
inadequate funds and a competitive grants process. Historically, 
funding levels for off-reservation ICWA programs have been between $1.5 
to $2.0 million. This has enabled the BIA to minimally fund about 40 
programs a year that serve the 65 percent of the Indian population that 
lives in primarily urban settings. These programs have also tried to 
access private foundation funding and state contracts to supplement 
their ICWA grants. However, these funds have been increasingly 
difficult to secure, especially in light of increased competition for 
these resources due to reductions in state and federal funding.
    We also know that many of these children may be served by state 
child welfare agencies at some point. Because of the small number of 
off-reservation ICWA programs operating in the United States, many of 
these children in urban areas are at great risk for not being given the 
protections of the Indian Child Welfare Act. This seems especially 
relevant when you consider the budgetary problems that states are 
experiencing that result in minimal resources for staff training and 
services in general.
                               conclusion
    The ICWA, Title II program is a resource that has shown to be 
extremely effective in protecting Indian children and helping Indian 
families stay together. A study in 1988 commissioned by the Department 
of Health and Human Services and Department of Interior entitled, 
``Indian Child Welfare: A Status Report'', revealed that tribal ICWA 
programs outperformed the BIA and state child welfare programs, 
notwithstanding the limited funding available to tribes. Specifically, 
Indian children in substitute care had shorter stays in foster care and 
higher rates of permanency when served by tribal programs. In 1994 the 
Office of Inspector General issued a report entitled, ``Opportunities 
for ACE to Improve Child Welfare Services and Protections for Native 
American Children'', which clearly showed that most states were either 
not willing or able to share federal funds for child welfare services 
with tribes. This clearly demonstrates that tribes, when provided the 
opportunity, are able providers of child welfare services, while 
currently not being able to depend on other funding sources or services 
outside of the ICWA, Title II grant program.
    We must also take into consideration other factors which impact the 
ability of tribes and off-reservation programs to protect their 
children and give them a sense of permanence. The new welfare reform 
law provides tribes with an opportunity to operate their own welfare 
programs, but does not provide the additional resources that will be 
needed to achieve full self-sufficiency for Indian families. States 
will have additional pressures under the new law to target their 
resources carefully. This will most likely mean that states historic 
reluctance to provide services on tribal lands will continue and 
possibly get worse. In addition, Congress and the Administration have 
set out to increase adoptions and permanence for children in this 
country. If tribes are not given the resources to help achieve this 
goal, then Indian children will likely continue to be the most 
unprotected class of children in this country with the least access to 
services that help provide permanency.
    Please consider our request carefully and help tribal governments 
and off-reservation ICWA programs continue to offer proven, locally 
designed and controlled programs for Indian children and families.
                                 ______
                                 
 Prepared Statement of Harry Wilde, Co-Chair, Lower Yukon; and Gilbert 
Huntington, Co-Chair, Upper Yukon of the Yukon River Drainage Fisheries 
                              Association
                            resolution 97-8

In support of Federal appropriations to implement the Interim Agreement 
      on Yukon River Salmon and the Yukon River Salmon Act of 1995

    Whereas the Yukon River Drainage Fisheries Association (YRDFA) 
represents commercial, subsistence and sport users of salmon and other 
fish within the Alaska portion of the Yukon drainage;
    Whereas the Interim Agreement on Yukon River Salmon, affirmed by 
Congress in the Yukon River Salmon Act of 1995, necessitates effective 
management and research programs for both U.S. and Canadian spawning 
stocks;
    Whereas the Interim Agreement also established a Yukon River Panel 
and said Panel requires significant administrative and operational 
support to assure effective user and agency participation in the 
implementing the Agreement as well as continued negotiations towards a 
long-term treaty;
    Be it Resolved That the YRDFA hereby requests the U.S. Congress to 
fully fund the following items necessary to implement the U.S./Canada 
Interim Agreement on Yukon River Salmon and the Yukon River Salmon Act 
of 1995; $1,062,100 for Yukon River research and management by the 
Alaska Department of Fish & Game, funded via the U.S. Department of 
Commerce; $400,000 deposit to the Yukon River Restoration & Enhancement 
Fund; $200,000 for Panel operations and administration; $210,000 for 
additional USF&WS programs in the Yukon drainage; $713,000 for NMFS to 
conduct salmon radio telemetery studies; $100,000 to USGS/BAD for chum 
salmon ecology studies; $1,000,000 to the Bering Sea Fishermen's 
Association, from the Bureau of Indian Affairs Western Alaska Salmon 
Investigations.
    Copies of this resolution to be sent to the Alaska Congressional 
delegation and to the members of the U.S. House and Senate 
Appropriations Committee.
    Approved unanimously this 13th day of February 1997 by the Board 
members and Delegates of YRDFA assembled at their Seventh Annual 
Meeting held in Mountain Village, Alaska.
            Certified:
                                   Harry Wilde,
                                           Co-Chair, Lower Yukon.
                                   Gilbert Huntington,
                                           Co-Chair, Upper Yukon.
            Attest:
                                   Dan Senecal-Albrecht,
                                           Executive Director.
                                 ______
                                 

  Prepared Statement of Gordon James, Chairman, Skokomish Indian Tribe

                                Abstract

    constructive resolution of skokomish river fisheries and water 
                          conflicts [$400,000]
    The Tribe requests that Congress direct the Bureau of Indian 
Affairs to provide the Tribe $400,000 in fiscal year 1998 for technical 
and legal assistance required to achieve constructive resolution of 
fisheries and water conflicts associated with the Cushman hydroelectric 
project on the Skokomish River in western Washington.
    Congressional funding during the last four fiscal years for 
essential technical and legal assistance has allowed the Tribe to make 
substantial progress in developing and building consensus for a 
pragmatic and equitable settlement of Cushman Project related issues. 
Absent a negotiated settlement, a cascade of costly and divisive 
litigation and political conflict is imminent.
    It is apparent that further conflict can be avoided and all 
parties' reasonable interests can be accommodated through a creative, 
pragmatic negotiated settlement of all Cushman Project related issues. 
However the window of opportunity for a settlement is rapidly 
narrowing. This is it--there will not be another opportunity to 
constructively resolve Cushman Project issues.
    The Tribe asks that Congress support continued funding for 
necessary technical and legal assistance in this pivotal year. This 
will allow the Tribe to capitalize on progress to date--and on 
Congressman Norm Dicks' settlement initiative--to secure the enormous 
public benefits of a negotiated settlement.
    constructive resolution of skokomish river fisheries and water 
                          conflicts [$400,000]
    The Tribe requests that Congress direct the Bureau of Indian 
Affairs to provide the Tribe $400,000 in fiscal year 1998 for technical 
and legal assistance required to achieve constructive resolution of 
fisheries and water conflicts associated with the Cushman hydroelectric 
project on the Skokomish River in western Washington.
    The Skokomish Tribe is committed to achieve a constructive, win-win 
settlement of Cushman hydroelectric project issues that will produce 
enormous public benefits and avert an imminent cascade of costly and 
divisive litigation and political conflict.
    Congressional funding during the last four fiscal years for 
essential technical and legal assistance has allowed the Tribe to make 
substantial progress in developing and building consensus for a 
pragmatic and equitable solution to Cushman Project-related issues.
    The Tribe asks that Congress support continuation of funding in 
this pivotal year, so that progress achieved to date can be converted 
into a constructive settlement. This long and arduous process is now 
coming to a conclusion, aided by settlement initiatives from 
Congressman Norm Dicks. There will not be another opportunity to 
constructively resolve Cushman Project issues.
    For nearly 70 years, the heretofore unlicensed Cushman 
hydroelectric project has diverted the North Fork Skokomish River out 
of its watershed. This has severely disrupted the Skokomish River 
watershed/ecosystem and wreaked environmental, social, economic and 
cultural havoc on the Skokomish Tribe and general public.
    Working collaboratively with local, state and federal agencies, 
Skokomish Valley residents and a host of public-interest groups, the 
Tribe has achieved substantial consensus on a plan for future Cushman 
Project operation that would restore damaged salmon runs, reverse 
degradation of the largest estuary on Hood Canal, and reduce the 
Cushman Project's contribution to flooding problems on the main stem 
Skokomish River.
    The Tribe's collaborative approach has also achieved unprecedented 
consensus with Mason County on a Skokomish River flood plan. The flood 
plan, Cushman Project plan, and South Fork forest plan are being folded 
together into an overall plan to reduce public costs and increase 
public benefits from the Skokomish River watershed.
    The Federal Energy Regulatory Commission's final licensing proposal 
for the Cushman Project would perpetuate tens of millions of dollars in 
annual damages to the Tribe and general public. It would satisfy no one 
and set off an uncontrollable chain reaction of legal conflict and 
political turmoil with far reaching consequences, if allowed to stand.
    The Tribe believes strongly that further conflict can be avoided 
and all parties' reasonable interests can be accommodated through a 
creative, pragmatic negotiated settlement of all Cushman Project 
related issues. Continued funding in fiscal year 1998 will allow the 
Tribe to build on substantial progress to date--and on Congressman Norm 
Dicks' recent settlement initiative--to secure the enormous public 
benefits of a negotiated settlement.

Proposed budget

Legal consultants.............................................   $90,000
Technical consultants.........................................   300,000
Meeting and travel expenses...................................    10,000
                    --------------------------------------------------------------
                    ____________________________________________________

      Total costs.............................................   400,000

    Technical Consultants: Negotiation and implementation of a global 
settlement for Cushman Project related issues by the Tribe, City of 
Tacoma, and Federal Government requires that the Tribe have the 
assistance of highly skilled, specialized professionals. Consultants 
will include a project manager/coordinator; planner/negotiation 
advisor; tribal negotiating team members; and specialized technical 
consultants including engineers, economists, anthropologists, 
biologists, geophysicists, hydrologists.
    Legal Consultants: Legal advice and representation will be required 
to assist in finalizing a negotiated settlement of Cushman Project 
issues among the City of Tacoma, the Tribe and Federal Government.
    Meeting and Travel Expenses: Cost of meeting space, meals and 
travel for tribal advisory committee and negotiating team members.
                                 ______
                                 

          Prepared Statement of Bristol Bay Area Health Corp.

    The Bristol Bay Area Health Corporation (``BBAHC'') is a private, 
non-profit corporation organized in June, 1973, by the Alaska Native 
villages of the region. BBAHC provides a wide variety of health 
services, including hospital services, family medicine, and other 
preventive and community health services. BBAHC serves more than 7,000 
year-round residents and 32 villages within the Bristol Bay and Calista 
regions, two of the twelve regions into which Alaska was divided under 
the Alaska Native Claims Settlement Act of 1971. In 1980, BBAHC became 
the first tribal organization in the United States to take over the 
operation of a hospital from the Indian Health Service (``IHS'') under 
the authority of the Indian Self-Determination and Education Assistance 
Act (``ISDEA''). In 1994, BBAHC entered into the Alaska Tribal Health 
Compact and, since that time, has been administering its health 
programs under Title III of the ISDEA. Since 1973, the Kanakanak 
Hospital in Dillingham has been accredited by the Joint Commission on 
the Accreditation of Healthcare Organizations.
    BBAHC Priority Budget Items. Focusing specifically on fiscal year 
1998 IHS budget items which are of highest priority in our region (as 
well as in other regions within the state of Alaska) we respectfully 
ask the Subcommittee to: fund mandatory cost increases--$80 million 
above the administration's request; fully fund contract support costs; 
provide requested $90 million for IHS Sanitation Facilities Account; 
provide $5 million in recurring funds for patient travel costs; provide 
the Administration's requested amount for the Community Health Aide 
Program in Alaska; increase authority and funding for the Alaska Area 
Office so that 10 additional leases may be funded under the clinic-
built village leasing program and provide additional funds for 
improving existing clinics; provide BBAHC $1.5 million to support Phase 
I of Kanakanak Hospital building rehabilitation plan, including roof 
replacement; and reinstate the statutory prohibition on charging a co-
payment to any IHS beneficiaries or to means testing beneficiaries.
    Mandatory Cost Increases.--BBAHC respectfully requests the 
Subcommittee to appropriate sufficient funds in fiscal year 1998 to 
cover all mandatory cost increases incurred by the IHS and tribal 
health care providers, including medical inflation, mandatory payroll 
increases, and population growth. The fiscal year 1997 funding level 
for IHS included a less than one percent increase for inflation and no 
adjustment for population growth. Consequently, tribal and IHS health 
programs had to absorb over 50 percent of mandatory cost increases in 
fiscal year 1997. The fiscal year 1998 budget would require absorption 
of 90 percent or $80 million in mandatory cost increases.
    Underfunding of IHS mandatory cost increases is particularly 
inequitable when compared to other federally-funded health care 
programs. In fiscal year 1997, while IHS received less than a one 
percent funding increase for inflation--far below the actual inflation 
rate, which exceeded 10 percent in some areas--the Medicare and 
Medicaid programs received a 7 percent funding increase for inflation. 
In addition, the IHS, which provides services to over 1.4 million 
patients residing primarily in rural areas, is limited in its ability 
to realize the same kinds of cost savings which other federally-funded 
health care programs have been able to achieve through managed care 
programs In urban areas.
    Contract Support Costs.--Contract Support Costs (``CSCs'') is an 
area of the IHS budget that is chronically underfunded. While we are 
pleased that the Administration has requested a $12 million increase in 
fiscal year 1998 over the fiscal year 1997 level, it still is not 
sufficient to cover anticipated shortfalls in funding for CSCs. If the 
$12 million request is fully funded, the shortfall for the Indian Self-
Determination Fund alone is still estimated by IHS to be $39 million. 
The National Indian Health Board estimates the unmet need for contract 
support for existing contracts at $12 million and the projected need 
for new contracts at $60 million.
    We urge the Committee to work with the Department of Health and 
Human Services to assure that sufficient funds are included in the 
fiscal year 1998 budget to meet the contract support requirements set 
forth in section 106(a)(2) of the Indian Self-Determination Act (``the 
Act''). Furthermore, we urge that reporting requirements be changed so 
that the IHS is required to provide the Congress with information on 
every contract or compact which is in the negotiation process and which 
will require funding from the contract support fund. Presently, the IHS 
is only required to report a shortage of Contract Support funding for 
the current and previous year.
    Sanitation Facilities.--We appreciate efforts by Congress and the 
Administration to systematically address the need for sanitation 
facilities. As pointed out in the Administration's fiscal year 1998 
budget request, there is a direct link between improved sanitation 
conditions and improved health. The IHS, as required by the Indian 
Health Care Amendments of 1988, has prepared a 10-year plan to address 
sanitation facility deficiencies and also prepares an annual report to 
Congress to identify the current inventory of deficiencies. The 
Administration's request for fiscal year 1998 for construction of 
sanitation facilities nationwide is $90 million, $2.2 million above the 
fiscal year 1997 enacted amount of $87.9 million. The IHS has estimated 
that annual appropriations of $146.5 million would be required to meet 
the 10-year plan by the year 2000 to serve existing Indian homes.
    Even with full funding of the IHS 10-year plan, however, Alaska 
would still be seriously deficient in sanitation facilities. In Alaska, 
alone, there is an unmet sanitation need exceeding $1 billion. Much of 
rural Alaska lives without an adequate supply of safe drinking water 
and without essential sanitation facilities. It should also be noted 
that the calculation of need for the 10-year plan only includes the 
estimated cost of so-called ``economically feasible'' projects. We 
believe the IHS should also include on this list those projects which 
they consider ``not economically feasible.'' Many of the villages in 
Alaska, which have very high construction costs due to climatic and 
geologic conditions, were not even considered in this cost estimate. 
Therefore, even if the 10-year plan were fully-funded, a number of 
Alaskan villages would still have inadequate sanitation facilities.
    Patient Travel.--A special concern for BBAHC, and rural Alaska, 
generally, is the high cost of patient travel. BBAHC serves a 45,000 
square mile area--an area larger than the state of Ohio. Therefore, we 
depend on local air taxi services to assist with medical evacuations 
from our 32 villages. The difficult nature of travel within BBAHC's 
service area, and the need to transport patients to the Alaska Native 
Medical Center in Anchorage for health care which cannot be provided in 
Dillingham make adequate funding of patient travel imperative. In past 
years, patient travel has been seriously underfunded. One result of 
inadequate funding for patient travel is that many patients are forced 
to forego or postpone care until an easily treatable condition has 
become a full-blown emergency. Thus, underfunding patient travel in 
fiscal year 1998 will actually cost more and will force BBAHC to choose 
between funding patient travel, an absolute necessity for providing 
access to services in Alaska, and paying for actual patient care. BBAHC 
fully supports the Alaska Native Health Board's request for a separate 
appropriation in the IHS budget of $5 million for travel costs.
    The Community Health Aide Program in Alaska.--The Community Health 
Aide Program (``CHAP'') is the primary health care delivery system for 
approximately 171 rural Alaskan villages and is a very cost-effective 
program. We appreciate the funding that was provided in fiscal year 
1997 to update the Community Health Aide/Practitioners Manual which we 
understand is currently underway. We urge the Subcommittee to support 
the President's request for fiscal year 1998 which maintains the fiscal 
year 1997 level of funding of $43.9 million.
    Village Built Clinic Leasing Program.--BBAHC strongly urges that 
the leasing authority of the Alaska Area Native Health Service 
(``AANHS'') under the Village Built Clinic leasing program (``leasing 
program'') be increased from the current level of 170 to 180, and that 
a commensurate increase in funding be appropriated for the ten 
additional leases. BBAHC has two outstanding requests for clinic leases 
under the leasing program, one for a clinic at Portage Creek and the 
other for a clinic at South Shore Aleknagik. According to the AANHS, it 
has already funded 169 out of the 170 leases it is authorized to fund 
and the remaining lease will go to another tribally-operated clinic in 
the Alaska Area which is not within the BBAHC service area. Part of the 
problem for BBAHC is that, under the leasing program, we need four 
additional health aides (two per clinic) to meet eligibility 
requirements for the two requested leases, amounting to a total 
estimated cost of $150,000. An additional $50,000 would be required for 
training of these individuals, thus amounting to a total cost of 
$200,000 per year for staffing of the two new clinics.
    We would also like to request additional funds for making upgrades, 
modifications and additions to existing village-built clinics and where 
appropriate, replace existing clinics. These much-needed improvements, 
which could be funded through a new program similar to the Maintenance 
and Improvements (M&I) Program, are above and beyond the realm of the 
current leasing program.
    Kanakanak Hospital.--BBAHC has recently concluded a long range 
facility plan for upgrade and expansion of the existing Kanakanak 
Hospital in Dillingham to accommodate changing and growing, health care 
and housing needs. BBAHC requests $1.5 million to support Phase I of 
the planned $20 million overall project which would be used for 
expansion of the Hospital Emergency Room. The long range facility plan 
addresses a number of existing facility needs, including replacement of 
the hospital roof which is in danger of collapsing. The flat roof is 
designed to withstand a snow load of only 40 pounds per square foot in 
an area where the minimal design load for buildings is 70 pounds per 
square foot. At least nine similar flat roofs have collapsed in other 
southwest Alaska facilities, including a roof of a local Dillingham 
school. The estimated cost of replacing the roof alone is $1.6 million.
    Renew the statutory prohibition on charging a co-payment to IHS 
beneficiaries.--On behalf of the Alaska Native patients we serve, BBAHC 
urges Congress to reinstate appropriations language which would 
prohibit the Indian Health Service from establishing means-testing for 
IHS beneficiaries, or charging a co-payment fee for any IHS program or 
service. The provision of Indian health care is one of several 
responsibilities the United States took on in return for land and other 
resources relinquished by tribes. We believe that this responsibility 
should not be diminished and respectfully request that the statutory 
prohibition language which was removed from the fiscal year 1997 
appropriations bill be reinstated.
    We appreciate the opportunity to voice our concerns in connection 
with the proposed IHS budget for fiscal year 1998 and would be happy to 
provide any additional information concerning our testimony to the 
Committee.
                                 ______
                                 

Prepared Statement of Margie Mejia, Chairperson, Lytton Ranceria/Lytton 
                   Band of Pomo Indians of California

    The Lytton Rancheria/Lytton Band of Pomo Indians wishes to submit 
this testimony for the record regarding the fiscal year 1998 budget for 
programs in the Bureau of Indian Affairs. Specifically, we express our 
support for the requested $4 Million increase for the Small and Needy 
Tribes Program, for a proposed fiscal year 1998 total of $8 Million.
    Located in Sonoma County, California, Lytton Rancheria is a newly 
restored/recognized Tribe [Scotts Valley Band of Porno Indians, et al 
v. United States of America et al. USDC No. Civ. No. C-86-3660-WWS; 
Sept. 6, 1991]. The Tribe has been removed from federal services for 
the past thirty years--the efforts to restore our status as a Tribe 
spans a period of ten years, five of which were spent in legislation. 
During this time the ill effects of termination have continued to take 
their toll on our people in terms of loss of property; education and 
health benefits; increased poverty; high unemployment; disruption of 
families; death of Tribal members due to alcohol and related illnesses 
or accidents; and the destruction of hope.
    The Tribe is currently landless, comprised of approximately 200 
Tribal members, and governed by a Council consisting of seven Tribal 
Officers, elected on May 14, 1995. Mrs. Margie Mejia is the current 
Chairperson and representative of the Tribe. The Tribal membership is 
47 percent male and 53 percent female, of these 40 percent are adults 
and 60 percent are children under 18. Tribal member residences are 
primarily in Sonoma County (57 percent), followed by Del Norte County 
(27 percent), with the remainder scattered throughout the State of 
California and the continental United States (16 percent).
    The Tribe plans to empower its constituents through education and 
training. The general membership approved a constitution on January 
20,1996, to establish laws that the Tribal members have agreed to live 
and abide by. Other empowering documentation which has recently been 
developed and is currently being utilized include: Enrollment Manual, 
Election, Enrollment and Voting Procedures Code, Tribal Government 
Tribal members have agreed to live and abide by. Other empowering 
documentation which has recently been developed and is currently being 
utilized include: Enrollment Manual, Election, Enrollment and Voting 
Procedures Code, Tribal Government Operations Manual, Tribal Court 
Procedures and related codes. The Tribe is willing to devote its time, 
energy and resources in order to become self-sufficient.
    Currently, the Tribe operates under several grant programs 
sponsored and overseen by the BIA, IHS, HHS, ANA, EPA, etc. A Library 
Services Grant provides publication materials needed for education and 
advancement. A Health Services Grant provides for the position of a 
Community Health/Alcohol Abuse Prevention Worker, which the Tribe only 
recently hired and expects to have a fully operational program running 
within three months. Other programs educate and support our leadership 
(ANA, ATG), tend to the health needs of members (SCIHP, CRIHB), our 
children (ICWA) and empower us with the ability to create our own 
economic development project(s) to ensure our future self-sufficiency 
and self-sovereignty (ANA, ATG, BIA Multi-Year). Since we are a 
landless Tribe with critical needs in the area of land acquisition and 
housing development, I would recommend that funding for the Native 
American Housing Assistance and Self-Determination Act of 1996 (Public 
Law 104-350) be increased to $850 Million for funding an Tribes. In 
addition, I would like to have monies set aside within the bill for 
small and needy Tribes funding.
    Without continued funding, especially in the crucial formative 
years for new Tribes, our membership will stagnate and revert back to 
the downward spiral of life quality experienced by so many Native 
Americans for so many years.
                                 ______
                                 

  Prepared Statement of Jaime Pinkham, President, Intertribal Timber 
                                Council

                                summary
    Mr. Chairman, I am Jaime Pinkham, President of the Intertribal 
Timber Council. I hereby submit the following summary and comments 
regarding the Bureau of Indian Affairs Forestry program and its 
proposed fiscal year 1998 budget: Add $300,000 to Area Forestry for 
four adrenal foresters, and add $150,000 to Central Office Forestry for 
two additional foresters; add $1 million to Forest Management Inventory 
arid Planning; add $500,000 to Woodlands Management, and add $3 million 
for a new I.R.M.P. line item.
                 intertribal timber council background
    The Intertribal Timber Council (I.T.C.) is a twenty one year old 
organization of sixty forest owning tribes and Alaska native 
organizations that collectively possess more than 90 percent of the 7.3 
million forest acres--and a substantial portion of the 8.6 million 
woodland acres--that are under B.I.A. trust management. These lands are 
vitally important to their tribes. They provide habitat, watershed, 
cultural and spiritual sites, recreation and subsistence uses, and 
through commercial forestry, income for the tribes and jobs for their 
members. In Alaska, the forests of Native corporations and thousands of 
individual allotments are equally important to their owners. To all our 
membership, our forests are essential to our physical, cultural and 
economic well-being, and assuring their proper management is our 
foremost concern.
          overview of declining bia forest management planning
    Mr. Chairman, the Intertribal Timber Council's fiscal year 1998 
testimony focuses, for the third year in a row, on the growing 
deficiency of the B.I.A.'s forest planning capability. Mr. Chairman, it 
is an unfortunate truth that the Bureau, despite its legal obligations 
as trustee, has never fully provided current and appropriate management 
plans for the forest and woodland resources it holds in trust for 
tribes across the country. Prior to 1985, B.I.A. records document that 
only 21 percent of the nation's Indian forestlands were managed under 
approved forest management plans. To help redress this appalling state 
of affairs, Congress instituted a separate $1.2 million program in 
fiscal year 1985 for forest management inventory and planning (FMI&P). 
That, along with increased levels of Forestry staffing at the B.I.A. 
Area and Central Offices, enabled the status of Native American forest 
planning to begin to improve. With continued vigilance by Congress and 
consequent attention from senior Bureau officials, along with an fiscal 
year 1991 funding increase to FMI&P of $300,000, the volume of trust 
forestland acres in compliance with planning requirements rose to above 
80 percent in 1993.
    However, since then, that figure has steadily declined. According 
to the B.I.A.'s most recent Status of Forest Management Inventories and 
Planning report, dated September 30, 1995, the volume of trust 
forestland acres covered with current management plans has declined to 
62 percent. But even that figure does not present the true scope of 
B.I.A. forest management planning shortcomings. Most of the acreage 
with current plans is concentrated among a relatively few reservations 
with large forests whose comparatively large staffs can develop forest 
management plans on their own. On a reservation-by-reservation basis, 
only 36 percent of forested reservations had current plans in place as 
of 1995.
    Since 1995, although we are not aware of any updated tables or 
records, we are certain the situation has continued to decline, most 
likely at an accelerated rate. Because, since 1995, funding for B.I.A. 
forest management inventory and planning, while remaining flat, has 
effectively been further eroded by both inflation and the increasing 
complex requirements of forest management planning. Moreover, since 
1995, B.I.A. Forestry personnel at the Area and Central Office levels, 
who provide the planning expertise for the great majority of smaller 
forested reservations, has been roughly cut in half.
    This is intolerable. With increasingly insufficient funds for FMI&P 
activities, and with sharply reduced manpower needed to oversee those 
activities, interpret data, and develop the actual plans, it is quite 
possible that soon only 25 percent or less of reservation forests will 
have current management plans. A forest without a current management 
plan is, in effect, out of control. For even the most basic commercial 
forest activity, timber harvest, the managers have little certainty 
they are harvesting too many trees or the right trees. The consequences 
are nothing more than guesswork, and given the long term production 
cycles of forests, the cumulative effects could easily be the severe 
damaging of a tribe's forest resource, if not its outright destruction.
    To assure that the most basic rudiments of forest planning can be 
provided tribal forestlands, we request that $300,000 be added to the 
Area Office Forestry budget for four additional professional foresters, 
that $150,000 be added to the Central Office Forestry budget for two 
additional professional foresters, and that $1 million be added to 
Forest Management Inventory and Planning.
    In addition, we request that Woodlands Management be increased by 
$500,000, and that $3 million be added for integrated resource 
management planning.
    Each of these four requests are discussed in further detail below.
 add $300,000 to area forestry and $150,000 to central office forestry 
            for additional professional forester capability
    Between fiscal year 1995 and today, B.I.A. Area Office Forestry 
personnel have been reduced from about 25 to about 15. In the same 
time, Central Office Forestry personnel have been reduced from about 19 
to about 8. Although reduced by roughly half from fiscal year 1995 
levels, these personnel are called upon to try to provide the 
professional and scientific expertise required for the successful trust 
planning and management of 7.3 million forest acres and 8.6 million 
woodland acres on more than eighty reservations throughout the entire 
United States. They are trying to do this at a time when forestlands 
are being recognized as never before for their biological significance 
and when forestlands are being intensely scrutinized and challenged on 
many aspects of their management, and particularly on any commercial 
utilization. Yet, with or without current plans, many tribes have 
little choice but to rely on the commercial use of their forest for at 
least some portion of essential tribal revenues.
    Of the 83 reservations with economically viable timberlands, many 
with smaller forests have no resident professional forestry personnel. 
And the great majority of the 83 reservations do not have personnel 
with the specialized expertise necessary for the development of a 
forest management plan. So those tasks, by necessity, fall upon the 15 
Area Forestry personnel spread throughout the B.I.A.'s twelve Area 
Offices, and upon the four technicians in the Central Office's Branch 
of Forest Resources Planning. It is, quite simply, well beyond any 
realistic expectation that such limited manpower can develop, review, 
and oversee implementation of management plans required by law for the 
83 reservations. In fact, the Branch of Forest Resources Planning has 
been forced by staff reductions to eliminate any forest planning 
capability, and today principally provides only inventory analysis.
    Today's request for six additional personnel is an exceptionally 
modest plea to begin the restoration of the B.I.A. forest planning 
capability, because tribal forests, without plans, are open targets for 
mismanagement or legal challenge, either of which would diminish or 
interrupt what for many tribes is a critical source of essential 
operating revenue.
       add $1 million to forest management inventory and planning
    The Forest Management Inventory and Planning budget covers the 
special one time costs associated with the periodic development of 
forest management plans. These funds are scheduled for application to 
various tribal forestlands as they renew their management plans. The 
funds are supposed to cover the costs of planning activities not 
provided in a reservation's regular, on-going forestry budget, such as 
remote sensing, mapping, inventory, management and implementation 
planning, and environmental assessments. These funds are particularly 
needed for those smaller tribal forests where there are few or no 
forestry personnel. But since fiscal year 1985, when the program was 
funded at $1.2 million, these funds have not kept pace with either 
inflation or the expanding requirements of forest planning and 
management.
    One particular example where additional FMI&P funding is needed is 
N.E.P.A. compliance. As of the end of fiscal year 1995, which is the 
most current data available, approximately 30 percent of Category 1 
forests (a major forested reservation with more than 10,000 acres of 
trust commercial timberland or an annual allowable cut of more than one 
million board feet) were without current environmental assessments, 
rendering them technically out of compliance with the National 
Environmental Protection Act and so subject to possible challenge and 
shut down. One of the larger tribal forests, that of the Navajo Nation 
has been shut down for several years because of challenge to planning 
and N.E.P.A. assessments.
    For the smaller Category 2 forests, the shortcomings are even more 
appalling. Only about 39 percent have accepted annual allowable cuts or 
a current plan. Less than a quarter of them have environmental 
assessments.
    To correct these deficiencies, the I.T.C. requests that the program 
be increased by $1 million for fiscal year 1998. While B.I.A. documents 
indicate a needed FMI&P increase of $5.1 million a year, the I.T.C. is 
seeking a $1 million increase in hopes that a more modest sum may be 
more achievable and provide at least a modicum of desperately needed 
improvement in the Bureau's planning capability.
                 add $500,000 for woodlands management
    We also request an increase of $500,000 for B.I.A. Woodlands 
Management, a doubling of the requested level. Mr. Chairman, in 1988, 
the B.I.A. Division of Forestry was formally assigned responsibility 
over the 8.6 million acres of tribal woodlands, including 4 million 
acres with commercial capability. At that time, B.I.A. data indicated 
$3 million was needed to properly initiate trust management of 
woodlands. $500,000 was provided, and has essentially stayed at that 
level ever since. Today, those funds cover the costs of woodlands 
managers at three Area Offices in the Southwest and the costs of on-
the-round projects. None of these woodlands have formal management 
plans, and only a few have rudimentary inventories. With little or no 
firm data, the three Area Woodlands Managers are essentially flying by 
the seat of their pants in trying to cover the millions of acres within 
their responsibility. Yet woodlands are intensively used across a wide 
range of activities, particularly for subsistence and small economic 
undertakings. An additional $500,000 would allow a greater degree of 
inventory and planning, a few additional personnel for increased 
oversight, and the implementation of an increased percentage of the 
annual backlog of submitted projects.
         add $3 million for funds for a new i.r.m.p. line item
    Finally, Mr. Chairman, I would like to request that $3 million be 
added as a new line item for Integrated Resources Management Planning 
in Non-Recurring Natural Resources Management.
    Mr. Chairman, it is generally accepted today that forestlands are 
vital, complex ecosystems, and that the harsh ``cut and plant'' 
approach of the past is grossly inadequate for the perpetuation of a 
healthy forest resource. Everywhere you look, whether it is the forest 
industry, state forestry, or federal forestry on B.L.M. and U.S. Forest 
Service lands, you see a new focus on comprehensive ecosystem 
management. Tribes are gratified by the growing understanding that our 
natural resources are precious and must be nurtured. Yet it is also 
frustrating to tribes that our Federal trustee, while heaping attention 
on comprehensive land management in other agencies, is turning a blind 
eye on its land management obligations to tribes. Other than one person 
in the B.I.A. Division of Forestry, the Bureau has no funds dedicated 
to comprehensive ecosystem management planning, also referred to as 
integrated resource management planning. Yet, among all Federal 
agencies, I.R.M.P.s are most appropriate, and needed, for tribal trust 
lands.
    Mr. Chairman, the Indian people live on and from their land. While 
our population is rapidly expanding, our land base is generally static. 
As a result, our land base is under increasing pressure. As noted in 
the 1994 report of the Indian Forest Management Assessment Team, tribes 
are progressive, dedicated stewards of our land, but the severely 
limited planning resources available to us are precluding options and 
flexibility. Moreover, should I.R.M.P.s not be available for tribal 
lands, reservations will become management blank spots in the broader 
fabric of surrounding land.
    B.I.A. has recently estimated an annual need of $15 million for ten 
years to develop I.R.M.P.s for all tribes. And on Indian forestlands 
alone, the I.F.M.A.T. report noted that $94 million is needed annually 
to bring B.I.A. other-than-direct timber production management 
activities up to parity with the U.S. Forest Service. Yet, B.I.A. has 
next to nothing. Accordingly, we request the establishment of a new 
I.R.M.P. line item, and that it be funded at $3 million to begin to 
address these shortcomings.
    Mr. Chairman, that concludes my testimony. Thank you.
                                 ______
                                 

Prepared Statement of Stephen A. Janger, President, Close Up Foundation

    Mr. Chairman, distinguished members of this Subcommittee, my name 
is Stephen A. Janger and I am President of the Close Up Foundation. It 
is a privilege for me to submit this testimony regarding Close Up's 
efforts to provide citizenship education opportunities for American 
Indian and Alaska Native students and educators.
    Before I begin to discuss Close Up's funding request for fiscal 
year 1998, I want to thank the Subcommittee for its past support. The 
civic education of thousands of American Indian and Alaska Native 
students has been enhanced by funds this Subcommittee made available 
through the Bureau of Indian Affairs (BIA). Unfortunately, no funds 
were made available for current Close Up programs in the fiscal year 
1997 Appropriations Act. Through this testimony, I hope to convince 
this Subcommittee that Close Up's work with American Indian and Alaska 
Native students and educators is a very worthwhile expenditure of 
scarce federal funds. In this regard, we respectfully request $300,000 
in fiscal year 1998 funding.
                                overview
    American Indian students hold a unique place in American society as 
citizens of both the United States and their Indian Nation, yet there 
are few opportunities in school to examine the implications of this 
``dual citizenship.''
    Nearly a half million American Indian and Alaska Native students 
are enrolled in schools across the nation, and there are many 
indications that their education is not comprehensive and needs 
enhancements to enable these students to be competitive. In 1991, the 
Indian Nations At Risk Task Force established a set of education goals 
to guide the improvement of all federal, tribal, private and public 
schools that serve American Indians and Alaska Natives and their 
communities. These goals call for all Native American students to 
``demonstrate civic, social, creative and critical thinking skills 
necessary for ethical, moral and responsible citizenship and important 
in modern tribal, national and world societies.'' Simply, native 
students must understand the implication of their dual citizenship to 
be actively involved in both tribal governments and the democratic 
process.
    Close Up's Washington High School Program responds to the need for 
educational tools for Native students and their teachers. The Close Up 
Washington program uses a hands-on approach to civic learning that 
picks up where traditional textbooks leave off. Close Up participants 
don't just listen to lectures, they take part in debates, role-play 
activities, simulation exercises, group work, cooperative learning 
situations, and directed discussions. They are challenged to apply what 
they learn to real world scenarios.
    Close Up participants meet with the people who make government 
work. In seminars, students discuss the process of government with 
leading decisionmakers, policy experts, diplomats, and journalists. 
They also have the opportunity to hear their leaders' views first-hand, 
and share their opinions and concerns directly with their elected 
officials. These opportunities serve to de-mystify U.S. government and 
its elected members, making the system of government accessible and 
engaging to young people.
    Based on the unique relationship between the federal government and 
the tribes, it is especially important that Native American students 
understand the process.
                      the need for civic education
    In February 1997, the Washington Post Magazine featured an article 
on Native American issues that included statistics outlining the status 
of Native Americans in society. While not new, the statistics reflected 
an alarming reality: of any ethnic group in America, Indians have the 
highest rates of poverty, unemployment, and disease. In his article, 
Peter Carlson asserted that ``Native Americans remain at the bottom in 
almost every measurable economic category.'' With Indians making up 
less than 1 percent of the population in the United States, it is vital 
that Native students learn to be leaders on behalf of their tribes if 
these statistics are to ever change for future generations.
    The Native American people of the United States are embarking on a 
new course in their relationship with the federal government. As 
federal funding decreases each year, those living on federally 
recognized Indian reservations will require educated, skilled leaders 
who can be vocal advocates for the needs of their tribes. Senator John 
McCain, former chairman of the Senate Indian Affairs Committee, 
confirmed this need when he stated that few legislators know ``* * * 
about the clause in the Constitution that says Congress has a special 
responsibility in dealing with Native Americans.'' Without appropriate 
education, American Indian struggles will continue with nominal support 
from voters and politicians who could have an impact on the lives of 
American Indian people.
    But balancing these worlds and their role in them can be very 
difficult for young people. Close Up's American Indian and Alaska 
Native program provides Native students with an opportunity to study 
what it means to have a foot in two cultures, or ``two worlds.'' For 
Native students, traditional values taught at home often conflict with 
what is taught in school. Through their Close Up experience, students 
start to see a circle being woven: They learn to respect tribal elders 
for their roles in the tribal council; They realize if they want to 
protect their sovereign rights as American Indian citizens, they need 
to obtain a comprehensive knowledge of government at all levels, 
federal, state, and tribal; and by sharing their life experiences with 
students from completely different backgrounds, Native students develop 
more pride in, and recognize the value of, their own culture.
    This increased pride enables students to begin looking at their 
culture from other perspectives. By visiting their nation's capital, 
students have the opportunity to see first-hand how vital it is for 
them to take a role in preserving their sovereign rights. They observe 
first-hand how their tribal leaders represent the tribe to the federal 
government. Students also study the process of working directly with 
the federal government. This information is particularly relevant to 
Native American students who may one day use this familiarity with the 
government as a vehicle to preserving their rights as both American 
citizens and members of their tribe.
    This is perhaps best enunciated by a social studies teacher at 
Santa Fe Indian School who wrote, ``Our young people are living in two 
worlds, and in the non-Native world they need to learn to be just as 
competitive as everyone else. Our tribal leaders and elders always tell 
our young people that they'll be the future leaders, but no one's doing 
anything to prepare them. That's what this program is all about.''
    Close Up's message of informed participation is not limited to the 
federal government. The Foundation encourages educators to develop 
civic education programs at the local level. We know that we have 
inspired Native American educators to conduct local programs, one 
example is the local program held annually at the Santa Fe Indian 
School. The 1995/96 topic, ``Unity and Sovereignty/Empowerment of 
Youth,'' involved student participants most of whom were enrolled 
members of one of the New Mexico Pueblos. The goal of this two-day 
program conducted for New Mexican Native American youth, tribal 
leaders, community leaders, and educators was to train youth to become 
responsible and knowledgeable in the areas of sovereignty, Indian law, 
tribal government systems, cultural awareness, leadership, and 
citizenship.
    Another example is a program established by Marilyn King-Johnson 
(Navajo), the project manager for the Navajo Nation Youth Incentive 
Program. Ms. King-Johnson said her interest in establishing a local 
program came to her while attending the Close Up Washington program. 
``I kept thinking `why can't we do this at home'? We tell our youth to 
learn about the state and national government, but we don't teach about 
the Navajo Nation. I wanted to teach the young people something not 
taught in school.''
    The enthusiasm generated by attending the Close Up Washington 
program multiplies the reach of expanded civic learning many times 
over. Teachers and students return home with newfound knowledge, 
teaching methodologies, and self-esteem, and they are anxious to share 
all of this with their community. Without federal funding, however, 
this program and its contribution to Native American students and their 
teachers will cease to be available to most of them.
            american indian and alaska native participation
    For more than twenty-five years, the Close Up Foundation has 
promoted responsible participation in the democratic process through 
educational programs in government and citizenship. With the help of 
this Subcommittee, Close Up has developed and tried to sustain an 
outreach policy to act on the belief that civic education is important 
to all students regardless of their families' financial status. This 
outreach policy, supported by fellowships to assist students with 
financial need, has ensured that a diverse student body is able 
participate in the Close Up program.
    During the last year that Close Up received federal support (1995-
96 program year), we had 248 students and teachers from 38 BIA high 
schools, and 103 Alaska Native students from remote villages, rural 
settings, and urban areas participate in the Close Up Washington High 
School Program. The vast majority of these students received fellowship 
support. We now find that without federal fellowship support we are 
losing the participation of many schools, and our forecast is that we 
will lose many more schools next year.
    Most of the schools no longer able to participate are exactly the 
schools you want to reach with a program like Close Up. These are 
schools in the most remote and isolated regions of the country, schools 
that have few, if any, outside educational opportunities, and, 
generally speaking, schools with a student population that would 
receive the greatest benefit from our program. Although Native 
students, as they have in the past nine years, are conducting 
fundraising drives to try to raise at least some of the money 
themselves, the desperate financial situation of many of these students 
and their communities makes it impossible for them to raise the 
necessary funds. The lack of a financial base within the community that 
could sustain a student fundraising effort makes the need for federal 
support all that more urgent.
    Despite all of the challenges these communities face, Close Up 
enjoys strong support in the Native American community. One example is 
at their January 1997 conference the National Congress of American 
Indians adopted a resolution of support for the Close Up program. We 
are very proud to have received such an endorsement.
    Mr. Chairman, the glaring need for civic education opportunities 
for American Indian and Alaska Native students has been clearly 
demonstrated by many educators and experts. The past support of this 
Subcommittee has made it possible for the Close Up Foundation to try to 
address this need. We are very proud of what we have been able to 
accomplish. Without federal support, however, we cannot continue our 
work with the multiplier effect that leads to important learning 
productivity. Therefore, we respectfully request $300,000 from the 
fiscal year 1998 Interior and Related Agencies Appropriations bill for 
our programs for American Indians and Alaska Natives. We would be glad 
to respond to any questions and to provide any additional programmatic 
or budgetary detail. Thank you very much.
                                 ______
                                 

 Prepared Statement of Virgil J. Murphy, Chairman, Stockbridge-Munsee 
                   Community Band of Mohican Indians

    The Stockbridge-Munsee Tribe appreciates this opportunity to 
present our requests for funding in fiscal year 1998 for the Indian 
Health Service. We request that this Subcommittee provide fiscal year 
1998 funding for our two priority projects: $3.6 million for a new 
wastewater treatment facility for the Stockbridge-Munsee Community, and 
$2.8 million for a new health clinic for the Stockbridge-Munsee 
Community.
    The Stockbridge-Munsee Tribe was once located in what is now the 
northeastern United States. However, in the early 1800's, we were 
removed from our ancestral lands to Indiana, and later relocated to 
what became the State of Wisconsin. Since 1856, our homeland has been a 
46,000-acre reservation in central Wisconsin. The Mohican Nation has 
nearly 1,600 tribal members, over 800 of whom live on the reservation. 
The Tribe's major economic opportunity has been our small but 
successful casino and bingo operation. In 1996, the Mohican North Star 
casino employed some 550 people, about one-third of whom are tribal 
members. As a result of gaming, we are now the largest employer in 
Shawano County, WI. The Community uses gaming proceeds to supplement 
funding for such tribal governmental programs as Elderly Assistance, 
Higher Education and Vocational Training, Housing Assistance, and 
Economic Development. In addition, we have built two homeless shelters 
and made numerous donations for assistance for needy tribal members 
from our gaming proceeds. The Tribal Council has two funding requests 
we have determined to be of highest importance, and we submit them for 
this Subcommittee's consideration.
       wastewater treatment facility and sewage collection system
    The fiscal year 1998 budget request for the Indian Health Service's 
Sanitation Facilities Construction account proposes a modest increase 
of $2.2 million over the fiscal year 1997 enacted level. While we 
support this requested increase, we note that the age of deficit 
reduction is evident here, because in the fiscal year 1997 budget 
request, the Administration requested an increase of $43 million over 
the previous year's funding level for sanitation facilities 
construction. Clearly, the Administration, Congress and tribes are 
forced to struggle to determine priority programs which will receive 
funding as efforts to balance the federal budget continue.
    As this Subcommittee knows, over the last several years, roughly 
one-half of the Sanitation Facilities Construction account has been 
used to address the backlog of sanitation facilities deficiencies in 
Indian communities which are included in the congressionally-directed 
10-year funding plan. The total need in Indian communities for water 
and sewer facilities is currently some $1.8 billion. Using the 
Administration's fiscal year 1998 budget request as a starting point, 
unless Congress appropriates additional funding over the budget request 
for Sanitation Facilities, only some $40-50 million of the requested 
$90 million will go toward the backlog. At this rate, Indian country is 
looking at 40 years before the existing backlog of water and 
sanitation--something most Americans take for granted--is addressed.
    The Stockbridge-Munsee Community itself is in the Bemidji IHS 
Service Area, which serves Wisconsin, Michigan, Minnesota and Indiana. 
The total level of need in our Service Area last year was more than $27 
million. The amount provided, by allocation to the Bemidji Area, was 
slightly over $1 million.
    With this in mind, the Stockbridge-Munsee Tribe is in desperate 
need of a wastewater treatment facility and sewage collection system. 
The Tribe currently does not have a regional treatment facility, but 
uses a three-cell lagoon system community water and wastewater system. 
Concerns about the health and safety risks associated with an outdated 
and inefficient wastewater system--including some seepage of wastewater 
out of the lagoon cells during drought years, and groundwater seepage 
into the cells during wet years--led to the Tribe receiving joint 
funding in fiscal year 1996 through IHS and HUD to repair and upgrade 
the existing lagoon system.
    The Tribe is grateful that fiscal year 1996 funding was provided to 
upgrade our existing system, which services our main housing 
development area. However, that area is made up of only 30 households. 
Even the upgraded lagoon system is not able to meet all current 
community sanitation needs. The Tribe's Planning Department projects 
that the Tribe will need to build 50 to 60 new homes for our members in 
the course of the next 10 years. Although several existing residential 
units on the reservation utilize individual septic tanks, due to the 
soil types on the reservation, it is very unlikely that these new homes 
will be able to utilize individual septic tanks. According to data 
stored on the Geographical Information System, almost 93 percent of the 
soil types located on the Tribe's trust lands have severe septic 
limitations. The remaining 7 percent of the land has moderate 
limitations. These limitations make it is very difficult to find 
suitable areas on which to build housing for our members. As a result, 
the Tribe is seeking funding to construct a master wastewater treatment 
facility which will enable us to construct these homes on lands that 
would otherwise be unsuitable because of the septic limitations.
    The proposed wastewater treatment facility would service an 
existing 80 residential dwellings within the regional service area, 
tribal offices, our health clinic, and the casino. In addition, the new 
facility would service the contemplated new housing development and 
other commercial development, including a planned hotel. It would also 
be able to handle future increases in wastewater flow.
    The IHS Field Engineer has estimated that the cost of the new 
master wastewater treatment facility and collection system will be $3.6 
million. The need for such a system has been documented and submitted 
to the Indian Health Service for inclusion on the Sanitation Deficiency 
System (SDS) Listing. But, as this Subcommittee well knows, there are 
many tribal projects currently on the SDS list.
    Without adequate funding to the IHS, necessary and essential 
projects like the Stockbridge-Munsee's wastewater treatment facility 
and sewage collection system will not be constructed. We ask that the 
Subcommittee support the Administration's requested increase of $2.2 
million to the Sanitation Facilities Construction account, and provide 
the necessary $3.6 million to the IHS to fund our Tribe's very needed 
project.
                 new health clinic and wellness center
    For the IHS Facilities account, the President's fiscal year 1998 
budget request proposes an increase of $39 million over the fiscal year 
1997 enacted level for construction of two replacement health 
facilities in Arizona. The Stockbridge-Munsee Community strongly 
supports this request, and urges the Subcommittee to support it. We 
know from our Tribe's own experience that many tribes throughout the 
country share our great and urgent need of a new health facility.
    The Tribe has a small health clinic on our reservation which was 
built in 1973. It is only 14,000 square feet, while the Facilities 
Management Office of the IHS recommends a facility between 17,000 and 
20,000 square feet in size. In addition to being severely limited in 
space, the clinic is in poor condition, with existing structural 
problems such as leaking roofs. After a point, further additions to the 
clinic--and there have already been two--are not economically 
efficient.
    During a typical month, the clinic provides medical services to 
over 1,200 patients, dental care to 200 patients, and fills over 1,000 
prescriptions at the pharmacy. Annually, the current staff of 35 full-
time and 14 part-time employees and 6 full-or part-time physicians and 
dentists provides necessary and essential medical treatment to over 
2,300 people--Mohican tribal members and Indians who are members of 
other tribes but live on our reservation, and numerous non-Indians who 
live within the original boundaries of the reservation.
    The severe space limitations and poor condition of the clinic make 
providing necessary medical services very difficult. As a result, in 
1996, the Tribe applied for and received a Community Development Block 
Grant from the Department of Housing and Urban Development. A grant of 
$300,000 was provided in fiscal year 1997 to design a new health clinic 
and wellness center. Currently, the Tribal Council is preparing a 
Request for Proposals for the purpose of contracting with an 
architectural firm to prepare the final construction and design of the 
new facility. The Tribe is seeking fiscal year 1998 construction 
funding in the amount of $2.8 million through the Indian Health 
Service.
    We are very proud of the services we provide our people and members 
of the surrounding community. We appreciate this Subcommittee's 
consideration of providing us with additional resources in fiscal year 
1998 through the Indian Health Service to improve our programs and 
services. Thank you very much.
                                 ______
                                 

   Prepared Statement of Frances G. Charles, Chairwoman, Lower Elwha 
                             Klallam Tribe

                                summary
    Lower Elwha Klallam Tribal requests:
    Support the Administration's request for an additional $76.4 
million in Tribal Priority Allocations.
    Continuation of Elwha River Restoration funding through the Tribe's 
BIA Self Governance Annual Funding Agreement: from the Water Management 
and Development account or Water Rights Negotiation Litigation account.
    Support National Park Service funding of $25 million toward the dam 
acquisition cost pursuant to Elwha River Restoration, Public Law 102-
495. And, authorization for $83.3 million to complete dam removal.
    $405,000 to implement initial phases of the Elwha chum salmon 
recovery program, as outlined in the Elwha River Restoration 
Environmental Impact Statement; and, $100,000 for salmon habitat 
improvements building upon the work begun in 1996.
    Increase in treaty shellfish implementation, management and 
enforcement, to $350,000 (as part of Point No Point Treaty Tribes' 
request for $1,400,000 for shellfish implementation).
    Full Contract Support (indirect cost) funding for BIA compact and 
IHS contract amounts for fiscal year 1998.
           lower elwha klallam tribe: elwha river restoration
    The Lower Elwha Klallam Tribe has been involved as one of the 
principal participants in examining the full restoration of the Elwha 
River through the removal of the Elwha and Glines Canyon Dams on the 
Olympic Peninsula in Washington State. Since 1989, the Tribe's 
involvement has been supported through the Bureau of Indian Affairs--
usually through the Water Rights Negotiation/Litigation account. 
Funding for the Tribe's efforts has decreased from a steady funding 
level of $470,000. The fiscal year 1995 amount was reduced to $375,000 
and in fiscal year 1996 the grant to the Tribe was only $94,000. The 
Tribe requests the assistance of the Committee in restoring the funding 
for the Lower Elwha Klallam Tribe. Since the 104th Congress amended the 
Elwha Act to include the State of Washington in the process, the Tribe 
is facing brand new challenges with regard to treaty rights protection.
    The Administration has requested $25 million for acquisition of the 
dams. The Tribe requests $405,000 for the initial phases of the chum 
salmon recovery program, including enhancement of the tribal hatchery 
to achieve the production of the fish needed to restore the fisheries. 
The Tribe also supports the Administration's request for authorization 
of $83.3 million in additional funds toward the removal of the dams.
                           fisheries program
    The specific needs in the fisheries services program are: Shellfish 
implementation, management and enforcement funding increase to 
$1,400,000 for the Point No Point Treaty Tribes ($350,000 for each of 
the four Tribes).
    Continuation of Jobs for the Environment program. The Tribe has 
done restoration work on the Little Hoko River in which several miles 
of river were rehabilitated and are once again suitable for salmon 
spawning. This project has provided three years of employment for five 
displaced timber workers, both Tribal and non-Indian.
    Support continued funding for US/Canada Pacific salmon negotiations 
to resolve the current impasse in the development of fishing 
regulations, as well as to continue management of fisheries under US/
Canada jurisdiction.
    Continuation of Wild Stock Initiative funds for the Tribes and 
State of Washington.
                         indian health service
    The Administration has requested a small increase from clinical 
services and contract support. We ask the Committee to support these 
requests: they are funds which go directly to the tribes for health 
care delivery.
                                 ______
                                 
  Prepared Statement of the Sault Ste. Marie Tribe of Chippewa Indians
    Mr. Chairman and members of the Committee. On behalf of the Sault 
Ste. Marie Tribe of Chippewa Indians, I want to thank you for this 
opportunity to appear before you to discuss our fiscal year 1998 
appropriations concerns.
    The Sault Ste. Marie Tribe of Chippewa Indians is the largest 
federally recognized tribe in Michigan. The Tribe is dedicated to 
achieving true self-determination and self-governance. Over the past 
few years we have opened schools, built health centers, established a 
tribal court system and worked to restore and enhance our economy and 
our land base. While much has been done, considerably more is needed to 
enable us to fulfill the promise of the self-determination policy. We 
urge this Committee and Congress to reaffirm its commitment to 
providing funding sufficient to enable tribes to maintain basic core 
services funded through the BIA and IHS.
                         indian health service
    One key to a brighter tribal future is ensuring that adequate 
health care services are provided to our people. Along these lines, we 
strongly urge the Committee, at a minimum, to support the 
Administration's request for funding levels for all IHS programs. In 
particular, we stress that many health care services for our people 
must be provided through contract health care--a program that has been 
chronically and severely underfunded. In this time of growing Indian 
populations and rising health care needs and costs, it is vitally 
important to provide a significant increase in funding for contract 
health services.
    The Tribe is a strong supporter of Self-Governance. We firmly 
believe that the best way to provide governmental services is to 
administer programs at the tribal level--tailored to the needs of our 
people. We entered a Self-Governance compact with the Indian Health 
Service on October 14, 1994, to maximize our ability to manage our own 
health care delivery systems and programs. While we see Self-Governance 
as the proper federal policy for government to government relations 
between the United States and our Tribe, we also have experienced some 
frustrations regarding how IHS implements Self-Governance. For example, 
while we have been an IHS Self-Governance Tribe for well over two 
years, we have not yet received any contract support costs regarding 
the administration of our tribal shares. These are funds which were 
negotiated as part of our annual funding agreement. They are critical 
to the success of Self-Governance. But the IHS continues to indicate 
that it does not have the funds to pay these key contract support 
costs.
    We also have found that another key promise of Self-Governance--the 
reduction of the federal bureaucracy and the transfer of resources to 
the tribes--has been painfully slow to take place. We urge the 
Committee to take additional steps to assure that Self-Governance leads 
to appropriate downsizing of the IHS, and a corresponding increase in 
the transfer of those savings to the tribes.
                        bureau of indian affairs
    The programs funded by Tribal Priority Allocations within the BIA 
are at the heart and soul of tribal governments. They include police 
protection, education, social services, tribal courts and other 
government functions necessary to protect the well being of our people. 
TPA is vitally important to Indian people and communities--and cuts in 
TPA would have devastating impacts on crime, education and tribal 
justice systems. We urge the Committee to increase funding for TPA, 
supporting at least the Administration's modest requested increase.
    The Sault Ste. Marie Tribe has recently entered into a Self-
Governance compact with the BIA. Here again, we are concerned that full 
funding for Self-Governance is not being provided. With respect to the 
BIA, no Central Office tribal shares are being made available, as was 
required by language included in this year's Appropriations Act. We ask 
the Committee to revisit this issue, and to require that BIA Self-
Governance compacts include Central Office tribal shares.
                     office of the special trustee
    The Office of the Special Trustee for American Indians was 
established by Congress to examine the longstanding and well documented 
mismanagement of trust assets by the BIA, and to recommend the reforms 
needed to correct these broad ranging problems. The Special Trustee has 
recently issued a draft ``Strategic Plan'' outlining his 
recommendations in this regard. Among other things, the Special Trustee 
calls for the consolidation of trust resource management, trust funds 
management and land title and records management in a new agency--the 
American Indian Trust and Development Administration. The thrust of the 
proposal is that the United States must dramatically change the manner 
in which it manages its trust responsibility to American Indians, and 
that the regulatory standards and best practices of private sector bank 
trust departments must be incorporated into the federal management of 
Indian trust assets.
    The work of the Special Trustee is long overdue. For too long, the 
mismanagement of trust assets by the BIA has been well documented--but 
no comprehensive solutions were advanced. Now, the Special Trustee is 
proposing a major overhaul of this key area. The proposal of the 
Special Trustee has significant implications for the future of federal/
tribal relations and the trust responsibility. Accordingly, it is 
vitally important that the work of the Special Trustee be fully 
funded--both to enable his work to advance, and to provide an 
appropriate level of guidance and consultation from the Tribes. We urge 
the Committee to concur with the Administration's recommendation of 
providing $37.5 million (a $5 million increase) for the Office of the 
Special Trustee. We must not repeat the mistakes of history by failing 
to provide the resources necessary for the government to fulfill its 
responsibilities regarding the management of Indian trust assets.
                           policy initiatives
    The trust responsibility--as well as elementary notions of 
fairness--require that tribes have an opportunity to express their 
views to Congress before any significant changes in federal Indian 
policy are undertaken. Nevertheless, over the last couple of years 
there have been a number of major legislative initiatives that, if 
enacted, would have had a major impact on Indian tribes and their 
members--but which were advanced in a manner that limited tribal 
participation in the process. These included provisions to waive tribal 
immunity from suit, to prohibit land from being taken into trust 
without a tribal-state tax agreement, to prohibit new gaming compacts 
and prevent the Secretary of the Interior from issuing gaming 
procedures, and to reformulate the manner in which the BIA provides 
funding to tribes, among others. These were advanced within the context 
of the appropriations process--as riders to the Interior appropriations 
bill--without any hearings from the Committees with jurisdiction over 
Indian affairs, and without any prior opportunity for tribes to have 
input in the process.
    We urge the Committee to resist any such efforts this year, and in 
the future. Congress must not enact legislation that fundamentally 
alters the rights of tribes, without at least hearing from the tribes 
themselves. If there is a view that changes in Indian policy are 
needed, let them be considered and debated through the normal 
legislative process, in the light of day, with the full participation 
of the tribes. The appropriations process is simply not a proper 
vehicle for overhauling key elements of the relationship between the 
United States and the tribes.
                               conclusion
    We thank you for this opportunity to address the Committee on 
behalf of the Sault Ste. Marie Tribe of Chippewa Indians.
                                 ______
                                 

Prepared Statement of the Assiniboine and Sioux Tribes of the Fort Peck 
                           Indian Reservation

    Mr. Chairman and members of the Committee, I am Caleb Shields, 
Chairman of the Assiniboine and Sioux Tribes of the Fort Peck Indian 
Reservation, in Montana. It is an honor to appear before you today to 
present the Tribes' fiscal year 1998 appropriations testimony. While 
our concerns are many, we would like to focus on certain areas 
regarding BIA and INS appropriations. We attach a list describing all 
of our needs in the BIA and IHS.
                      tribal priority allocations
    The Tribal Priority Allocations system is intended to give tribes 
an additional measure of flexibility in determining how to use 
available funds to best meet local needs. The Administration has 
requested an increase of $46 million for programs under TPA. This 
request would essentially restore overall funding for TPA to fiscal 
year 1995 levels. While we support this restoration it would still fall 
far short of allowing the Fort Peck Tribes to meet the needs of our 
people in key areas including law enforcement, education, welfare 
assistance and housing. We urge the Committee to do all it can to 
increase TPA above the level requested by the President.
Law enforcement
    The President's budget requests $79 million for BIA/tribal law 
enforcement nationwide. This is an $8.2 million increase over last 
year's level, but is about $1 million less than was provided in fiscal 
year 1995. This modest funding must meet the needs of 200 Indian 
Reservations with 198 BIA and tribal law enforcement agencies covering 
approximately 100,000 square miles. At Fort Peck alone, we have a $1.3 
million shortfall in our law enforcement department. Our Reservation 
covers 6,000 square miles. We have a population of 13,000 living on the 
Reservation. We only have a police force of 18. We need a minimum of 25 
police of fleers to safely patrol the Reservation. Although our of 
ricers are well trained and dedicated, there are simply not enough of 
them to meet the day to day law enforcement needs of my community.
    In addition, our law enforcement department is in desperate need of 
equipment. We have only 8 aging police cars, to patrol the entire 
Reservation. Our Department also needs additional criminal equipment 
such as car radios, bulletproof vests, roll bars and protective 
shields. Several recent incidents of violent crime have plagued our 
Reservation. The community is currently working to understand the 
causes of these crimes and to develop mechanisms to lessen the risk of 
such crimes in the future. While there will undoubtedly be many parts 
to any solution, it is clear that one fundamental component is a strong 
police presence. This will send a strong message that violent crimes 
will not go unpunished in our community. It is critical that this 
Committee endorse the Administration's full request for law 
enforcement.
Education
    The President's budget requests $30 million for scholarships for 
Indian students to accredited post-secondary schools, an increase of $3 
million. We support this request. Encouraging our people to take the 
step to attend post secondary school is one of the Tribes' top 
priorities. Attending college--particularly for those individuals from 
families that have not previously sent anyone to college--takes courage 
and often considerable personal sacrifice. We believe it is our 
responsibility to support the efforts of our people to attend college. 
Unfortunately, current funding provides scholarships to only 60 percent 
of the people who applied for assistance. This means that 40 percent of 
our eligible people who wish to further their education are shut out. 
This is tragic, as it diminishes the number of educated Tribal members 
who would return to our communities to work with our youth, our elders 
and otherwise enhance the well-being of the Tribes.
Welfare assistance
    We strongly support the Administration's requested increase for 
welfare assistance. However, this request is still $7 million less than 
what was provided for this program in fiscal year 1995. Since 1995, the 
caseload for assistance under this program has increased substantially. 
The BIA and the tribes expect the caseloads to rise significantly, 
particularly during the initial stages of the implementation of the 
welfare reform law. As Indians are denied assistance under state plans, 
they will increasingly turn to the tribes.
    In communities like mine with an unemployment rates as high as 59 
percent, welfare assistance ensures that at least some of our people 
will not go without the most basic needs in life. Currently, we need an 
additional $600,000 for welfare assistance. Because of the significant 
shortfall, we can provide assistance to only 66 percent of the people 
who apply. The other 34 percent must do without. The Administration's 
requested increase will not even meet the existing needs for this 
program, let alone the expected increases. While we support the 
increase as a minimum, we urge this Committee to restore funding to 
this critical program to at least the fiscal year 1995 level.
    The Fort Peck Tribes are very concerned that the Administration has 
failed to request any money for programs under the Indian Child 
Protection and Family Violence Prevention Act. The Administration 
budget includes a new funding line item, but that tiny step does not 
provide any services to prevent child abuse, or help its victims. I 
cannot accept the Administration's statement that neither the BIA nor 
the entire Department of the Interior could ``secure resources to begin 
operation of these programs.'' These programs should be a priority for 
all of us who choose to work for the people of our communities and the 
Nation. Congress recognized the significance of this problem when it 
enacted the Act. This Act must be funded. I urge this Committee to 
provide $10 million to begin the operation of these programs.
                        tribal school ($102,200)
    In the fall of 1995, the Fort Peck Tribes authorized the operation 
of the Fort Peck Tribal School, an alternative school to meet the 
educational needs of our children who have problems that prevented them 
from continuing in the public schools. The Fort Peck Tribes realized 
that unless we stepped in and took on the responsibility to educate 
these children, they would not be able to complete their education and 
would likely be lost to us forever. The Tribes were able to open the 
tribal school with a small grant from the Walmart Corporation and in 
kind contributions by the Tribal College and our parents. The school 
now has an enrollment of fourteen children. These are children who were 
expelled from public school for behavioral or other reasons and had no 
hope of completing their public education. Because of a lack of space 
and personnel, we have had to turn away ten additional children. We are 
now asking this Committee for $102,200 to continue this important 
initiative.
    The school provides a full day of instruction. Academic classes 
include instruction not only in math, biology, and history, but also in 
the languages of my people. We are proud of our children in this school 
and the progress that they have made in improving their lives. We 
understand that there is a freeze on adding schools to the BIA system, 
but if we do not try to address the needs of these at risk children 
through education programs, we will almost certainly be forced to meet 
their needs through our juvenile justice programs, our substance abuse 
programs and our welfare programs. Our innovative approach to 
alternative education must be explored and rewarded. I am confident 
that it will prove to be an investment that not only helps students, 
but saves the government money in the long run.
             detention facility renovations ($2.4 million)
    In June 1995, the BIA completed a needs assessment of the Fort Peck 
Detention Facility, the only adult detention facility on our 
Reservation. The needs assessment found that the facility was in need 
of several repairs to address structural deficiencies that would result 
in violations of both building codes and BIA standards for detention 
facilities. As the report makes clear, the facility needs additional 
inmate housing. It also needs new fire alarms and monitoring systems 
and a new intake/booking area with holding cells. The estimated cost of 
these items is $2.4 million dollars. We request this Committee to 
include this amount in the BIA's construction budget.
                            tribal colleges
    We support the Administration's $30 million request for tribal 
colleges. This request is consistent with the President's Executive 
Order on Tribal Colleges, which supported enhancing federal support to 
tribal colleges and universities nationwide. The twenty-four tribal 
colleges are important institutions to remote tribal communities. On 
the Fort Peck Reservation, we operate the Fort Peck Tribal College, a 
fully accredited institution, offering Associate Degrees in arts, 
science and applied sciences. We also offer a vocational certificate 
for our students. We have a current enrollment of 366 students. Last 
year twenty-eight of our students graduated. Of these twenty-eight who 
graduated, 7 went on to continue their education in a four-year 
institution.
                             indian health
    We strongly support the Administration's requested increase for 
contract health care, which provides valuable assistance on 
Reservations like mine where there is no IHS hospital. On the Fort Peck 
Reservation, we have a shortfall of $1.1 million in contract health 
care. The Administration's request of $374 million for contract health 
care will certainly not enable us to meet all of the health care needs 
of our people, but it will allow us to provide services to additional 
people. We urge the Committee to provide additional funds for contract 
health care.
                                 ______
                                 

Prepared Statement of Tom Maulson, Tribal Chairman, Lac du Fambeau Band 
                   of Lake superior Chippewa Indians

    Mr. Chairman and members of the Committee. My name is Tom Maulson 
and I am the Tribal Chairman of the Lac du Flambeau Band of Lake 
Superior Chippewa Indians, located in Wisconsin. I am here to testify 
on behalf of my people, to discuss their issues, concerns and needs.
    The message from my people is that the United States must keep its 
obligations to the Lac du Flambeau Band. The United States is obligated 
by Treaty to provide critically needed social, education, health and 
governmental services to the Band and its members in exchange for the 
land and peace provided by our forefathers. This is the heart of the 
federal government's trust responsibility to the Band. And, this trust 
responsibility is very much on the minds of my people--who know how 
much we gave up in exchange for the promises of the federal government. 
We urge you to keep this in mind as well, as you consider funding for 
Indian programs.
    I turn now to some specific funding issues arising out of the 
President's fiscal year 1998 Budget.
                              health care
    Health care on the reservation remains a major concern of our 
tribal members. Currently, the IHS Budget for our service unit funds 
only about 60 percent of the Band's need for health care services. The 
overall IHS Budget of $2.12 billion must serve a rapidly expanding 
Indian population, now in excess of 2 million people, in a time of 
rising health care costs. The impact of the shortfalls is seen most 
dramatically at the Reservation level. At Lac du Flambeau, most of the 
health care for our people is provided through the IHS contract health 
care system. Funding for contract health care meets less than half of 
our need. We are forced to undertake a terrible rationing of health 
care--addressing only emergencies. If a child requires an MRI or CT 
scan, we cannot provide these services--unless a life is in imminent 
danger. We cannot provide eyeglasses or hearing aids for our elderly. 
In many ways, current funding levels are leaving our people without 
funds for health care which, by any humane view, should be provided. We 
urge the Committee to provide an increase of 10 percent (about $36 
million) for contract health services to enable tribes to provide an 
appropriate and decent range of health care services to our people.
                            indian education
    I was glad to note that the President has set education as one of 
his fundamental priorities. I urge the Committee, and Congress, to join 
with the President in providing the resources and programs necessary to 
improve the educational opportunities throughout the United States. At 
the same time, I urge the Committee to work with the tribes to find 
ways to target the particular educational needs that arise in Indian 
country.
    For example, the BIA Higher Education Program provides desperately 
needed scholarship funds to tribal members. But, while we strongly 
support this program, it does not meet a critical need of many of our 
members--payment for child care and transportation expenses to enable 
them to attend college.
    We currently have 41 students participating the Higher Education 
Program. Most of these are older students, who have families and did 
not pursue higher education immediately after high school. The average 
age of these students is 29. Our Reservation is in a remote area of 
northern Wisconsin, with the nearest 4 year college located 90 miles 
away. Transportation to and from school is a major burden for many. 
Likewise, child care is very expensive in our area. In many cases, the 
costs of transportation and child care create insurmountable barriers 
for qualified students who wish to remain in school. Currently, most 
financial aid programs, including those for individuals with very low 
incomes, do not cover child care and transportation costs. The Band 
urges the Committee to provide funding for needed child care and 
transportation within the BIA Higher Education Program--to enable more 
of our students to be able to stay in school and pursue their dreams.
                           natural resources
    The natural resources of the Lac du Flambeau Band are our most 
valuable and significant asset--apart from our children. Our natural 
resources provide my people with cultural, spiritual, subsistence, 
social and economic opportunities. The Reservation is located in the 
heart of Wisconsin's tourism and sportfishing region. Tourism and 
related industries provide livelihoods for Indians and non-Indians 
alike. The land, the water, the air and all the animals and plants that 
live along with us on this Reservation, help make us what we are as a 
people. We need funding to assure that we can fulfill our 
responsibilities to keep these resources clean and available for the 
generations to come.
    The Lac du Flambeau Band has developed considerable expertise in 
the management of our natural resources. We have a fish hatchery that 
is a central element of our overall natural resources program. Our 
activities also include conservation law enforcement, development of 
tribal management codes, fish population studies and habitat 
improvement. Unfortunately, there are growing stresses on our natural 
resources from increased local development. We have a dedicated staff 
of 20 in our Natural Resources Department. But funding for our staff 
and these critical programs has not increased since 1990, a period 
which saw our costs escalate rapidly. Unless there is an increase in 
funds, we will either have to reduce services, or lose some of our 
qualified staff. We urge the Committee to increase our Tribal 
Management and Development funds by $125,000 to enable us to maintain 
our critical natural resource programs.
    We strongly support full funding for the Circle of Flight program 
(also known as the Wetlands and Waterfowl Management program). This 
program addresses the critical problem of the decreasing number of 
waterfowl and the deterioration of our wetlands. The program emphasizes 
locally developed tribal programs, involving wetlands restoration, 
refuge creation, waterfowl nesting site development and others. Under 
this program, tribes are contributing needed wetlands and some of the 
best waterfowl areas in the Nation. We urge the Committee to provide a 
total of $1 million (an increase of about $400,000) to promote worthy 
Circle of Flight programs.
    The Band is responsible for managing 55,000 acres of forest land on 
our Reservation. We must handle broad needs including tree planting, 
prescribed burning, timber road design and maintenance, timber sale 
administration, and integration with wildlife management. In addition, 
our Forestry program is responsible for cultural resource surveys under 
section 106 of the National Historic Preservation Act, although we 
receive no funds for that labor intensive and important responsibility. 
We request an additional $40,000 to enable our Forestry program to 
undertake the necessary activities in managing our forest lands.
                            law enforcement
    Police protection is a major government function in every 
community. At Lac du Flambeau, our tribal police have cross-
deputization responsibilities--which require that they obtain a full 
measure of federal and state law enforcement training and 
certification. Moreover, because the local Vilas County Sheriff's 
Department in our area has reduced patrols on the Reservation, 
increased law enforcement presence by the Band is necessary. To provide 
the required services, we need 10 law enforcement officers. We need an 
additional $224,000 to assure the safety of residents of our 
communities.
                      tribal priority allocations
    At Lac du Flambeau, our education, law enforcement, forestry and 
other key programs are included within Tribal Priority Allocations. The 
TPA system allows the Band to move funds from one TPA program to 
another, in line with the priorities set by the Band. But, particularly 
for the last two years, TPA programs have been insufficiently funded 
across the board, and have not met the needs of the tribes. This has 
forced tribes to ``rob Peter to pay Paul''--even though neither Peter 
nor Paul had enough in the first place. For fiscal year 1998, the 
President has called for an increase of $53.3 million. While this is a 
good start, it falls short of the actual needs in Indian country. We 
urge the Committee to increase TPA by an additional $50 million, above 
the Administration's request.
    Thank you.
                                 ______
                                 

  Prepared Statement of the Fond du Lac Band of Lake Superior Chippewa

    Mr. Chairman, Members of the Committee, the Fond du Lac Band of 
Lake Superior Chippewa would like to thank you for this opportunity to 
present our testimony on fiscal year 1998 appropriations for the 
Department of Interior and Related Agencies. We urge the Committee's 
continued support for tribal programs, which are so important to the 
lives of our people. In particular, we seek your support for our 
natural resources and forestry initiatives, which are essential to 
protect the resources on which our people depend. We also seek your 
support for our Fond du Lac Ojibwe School which is needed to provide a 
safe setting in which we can educate our children.
    The Fond du Lac Reservation is one of six Chippewa Bands in the 
Minnesota Chippewa Tribe. The Reservation was established by Treaty 
with the United States on September 30, 1854. The Reservation 
encompasses approximately 100,000 acres. There are currently about 
3,350 members of the Fond du Lac Band.
    Our message to the Committee is this: There continues to be 
substantial unmet needs in health, education, and the protection/
management of our natural resources. Any reductions in funding, no 
matter how small, for Indian programs would have severe, adverse 
impacts on our people. While the BIA may not be as efficient or 
accountable as it should be, that is no reason to reduce federal 
funding in ways that will harm Indian people. The relatively small 
amount of federal funds that actually reaches the Tribes and serves the 
needs of Indian people must be preserved.
    On-Reservation Needs.--The waters, wildlife, wild rice, and forest 
resources of our Reservation are vitally important to the members of 
the Band, as these resources provide the foundation of our culture, 
subsistence, employment, and recreation. The Fond du Lac Reservation 
includes some 3,200 acres of lakes, 1,900 acres of wild rice lakes and 
associated wetlands, 66 miles of cool water streams, and 17,500 acres 
of forest. Unfortunately, our resources are under great stress. The 
loss of wild rice lakes and wildlife habitat, and the decline of forest 
biodiversity are of great concern to the Band. Therefore, we are 
seeking an additional $240,000 for our natural resources and forestry 
program to enable us to address the challenges we face in this critical 
area. The main area of concern is the Aquatic Resource Protection and 
Restoration. It is imperative that we continue to protect these 
resources for the future generations on Fond du Lac by the 
implementation of anti-degradation monitoring program with emphasis on 
mitigation of contaminants.
    Likewise, it is essential that we provide proper management of our 
forests, to assure that those resources are properly managed and remain 
productive over time. Our original white pine forests were largely 
destroyed by uncontrolled cutting early in the century. We need to 
mange our remaining forests with selective cuts, extended rotations and 
smaller staged cuts, to conserve the resource. Our goals are to 
increase our harvest from 130 acres to 350 acres per year, to enhance 
the forest wildlife habitat [particularly for game species], and to 
increase biodiversity. We will accomplish these objectives through our 
Integrated Resource Management Plan, with the cooperation of state, 
county, and private forest and wildlife managers. We also feel it is 
important to support the funding of the BIA's Forest Development, and 
Inventory and Management Planning add-on funds.
    A third component of our natural resources initiative involves our 
waterfowl and related wetlands resources. The Band has been a 
participant in the ``Circle of Flight'' program, by which a number of 
tribes have had a high level of success with local initiatives in 
wetlands and waterfowl habitat restoration. We urge the Committee's 
continued support for this critical program.
    Ceded Territory Needs.--The Fond du Lac Band has had its rights re-
affirmed in the 1837 Ceded Territory. This means the Band is 
responsible for an approximate 3,000,000 acres of land and must 
implement a system similar to the one used in the 1854 ceded territory 
to protect the exercise of treaty reserved rights. We are seeking an 
additional $186,551 to be added to the Bureau of Indian Affairs base 
budget and earmarked for Fond du Lac and the 1837 ceded territory. We 
also ask that you to support the joint request of the 1854 Authority 
and Fond du Lac to increase the base budget of the 1854 Authority by an 
additional $255,507. This request is important to continue the 
enforcement, monitoring and assessment activities in the 1854 Ceded 
Territory.
    Fond du Lac Ojibwe School.--Our top priority is education. Our 
greatest concern in this area is that our children are currently forced 
to attend a school that is unsafe. Four years ago a BIA report examined 
our existing grant school, and concluded that ``The building poses a 
clear and immediate danger to its occupants. Any attempt to continue to 
use this facility on other than a short-term, interim basis, is 
imprudent.'' 1992 BIA Construction Validation Report. As this 
conclusion reflects, our current school, which serves students from 
kindergarten through 12th grade, is in a decrepit and unsafe condition. 
The building does not meet building codes or BIA space guidelines. We 
are concerned that the physical plant of our school leaves our children 
in serious jeopardy, and places them at a significant disadvantage in 
terms of education opportunity. Children can not be properly educated 
in an inadequate and deteriorating school.
    In 1992, the Fond du Lac Reservation submitted an application to 
the Bureau of Indian Affairs for New School Construction. Following an 
October 1992 Construction Validation Study, the Fond du Lac Ojibwe 
School was ranked 14 on the ``Education Facilities Construction 
Priority List of fiscal year 1993.'' In 1996, Fond du Lac received a 
Public Law 100-297 Grant in the amount of $578,989 for the planning and 
design phase of the school project. Planning and Design will be 
completed by July 1, 1997. It would be expedient if construction 
funding were appropriated at this time rather than fiscal year 2000 or 
later as the BIA has projected.
    We urge the Committee to provide additional funding in the amount 
of $12 million for a new school on the Fond du Lac Reservation.
    Additional Education Program Needs.--The Band strongly supports the 
Administration's request for Indian Education programs including: $296 
million for the Indian School Equalization Program (ISEP); $34 million 
for Student Transportation; $74 million for Facilities Operation and 
Maintenance; $44 million for Administrative Cost Grants; and $5.4 
million for Early Childhood Development. Funding should also be 
continued for flow through programs serving tribes including: Title I; 
Individuals with Disabilities Act (IDEA); Substance Abuse and Title IX. 
We are however very concerned that the Administration has requested 
only $17.2 million for the Johnson-O'Malley program. This is a $1 
million cut from last year's level. A number of our youth go to public 
schools and the Johnson-O'Malley program is critical to their success 
in the public school system. I urge this Committee to reject this cut.
    We support the Administration's $30 million request for tribally 
controlled Community Colleges. However, it is clear that this amount of 
funding is not sufficient to meet the growing need of tribal colleges. 
The Fond du Lac Tribal and Community College is unique in the United 
States as it is jointly a tribal college and a member of the Arrowhead 
Community College Region in Minnesota. Continued financial support for 
American Indian students and educational programs at this Tribal 
College is vitally important. Tribal Colleges provide an important and 
unique educational opportunity for many of our students. These 
institutions must be strongly supported.
                               conclusion
    The needs at Fond du Lac and on other Reservations throughout the 
country remain massive. We appreciate the Committee's consideration of 
our appropriations request and we urge the Committee to do all it can 
to preserve funding for Indian programs.

Attachment.
                                 ______
                                 

  Supplemental Information on Fond du Lac Ojibwe School Construction 
                                Proposal

    The Fond du Lac Band of Lake Superior Chippewa proposes to 
construct and equip a new facility for its tribally-controlled school, 
the Ojibwe School, in order to replace its present, run-down facility.
    The existing Ojibwe School is a grant school under the Tribally 
Controlled Schools Act of 1988 (Public Law 100-297, Title V, Part B.; 
the ``Tribally Controlled Schools Act'') serving approximately 210 
children in grades K-12. The facility is old and decrepit. It utilizes 
four temporary portable buildings to house its Middle School (Grades 6-
8) and library. It is not large enough to handle existing enrollment. 
The facility is in violation both of applicable building codes and BIA 
space guidelines. The 1992 BIA Construction Validation Report stated 
that, ``The building poses a clear and immediate danger to its 
occupants. To not replace the facility could be construed as negligence 
in the even a fire occurred. Any attempt to continue to use this 
facility on other than a short-term interim basis, is imprudent.''
    Notwithstanding these facility handicaps, the school has been able 
to provide high quality education to the students it is able to admit. 
The Fond du Lac Community, School Board, Reservation Business 
Committee, Education Administration and Staff have continually sought 
to improve Indian Education since the inception of the Ojibwe School. 
The involvement of the community has been instrumental to the existence 
of the school. With the help of tribal, state and federal programs, the 
Ojibwe School has evolved into a leader in tribal education. The school 
has been in operation since 1980 with a current annual operating budget 
of $3.3 million.
    The school operates as a pre-K-12 optional school by North Central 
Association (NCA) of Accreditation. As an accredited school, the 
program is required to satisfy all the components established by the 
NCA. In 1996, the Ojibwe School was second-warned for violation of 
Standard XII, School Facilities. A school may be dropped from NCA 
membership if steps are not taken to correct the cause for warning. In 
the meantime, serious health and safety problems, outlined by annual 
BIA and Indian Health Service surveys, continue at the Fond du Lac 
Ojibwe School.
                               new school
    The new 90,000 square foot school proposed by Fond du Lac, to be 
built at an estimated cost of $12 million, would serve approximately 
365 students in grades K-12. It would be built on the Reservation, near 
the existing school in accordance with BIA educational space 
guidelines, North Central Accreditation Standards and educational space 
recommendations of the Minnesota Department of Education.
                                 ______
                                 

Prepared Statement of John Wilmer, Sr., Chairman, the Bad River Band of 
                     Lake Superior Chippewa Indians

    Mr. Chairman and members of the Committee. I am John Wilmer, Sr., 
Chairman of the Bad River Band of Lake Superior Chippewa Indians, of 
Wisconsin. I appreciate this opportunity to provide the Committee with 
the Band's testimony on fiscal year 1998 appropriations.
                              health care
    A. Contract health services.--The need for health care services has 
risen dramatically at Bad River--with our user population increasing 
from about 1100 in 1991 to about 2500 today. But funding has failed to 
keep pace. The shortfall is particularly critical with respect to 
contract health services--which is the major source of funding for most 
of our health care needs. As a result of funding limitations, contract 
care must be limited to emergency care only. (We urge the Committee to 
increase funding for contract health care.)
    B. Dental services.--Our dental program is able to pay only for 
emergency dental work for adults. With a current budget of $104,000 our 
dental program has a list of 221 adults waiting for dental services, 
for which no funds are available. Of these, 33 are elders. Often, the 
inability to obtain needed dental work for elders makes it difficult 
for them to eat--which in turn leads to further medical problems. We 
need an additional $200,000 to provide services to those now waiting 
for needed dental care.
    C. Diabetes.--As the Committee is well aware, diabetes is a major 
problem in Indian Country. At Bad River, we have 215 diabetes patients. 
Among these patients, we have witnessed a tragic increase in the number 
of amputations in the past year. To help address this, our diabetes 
patients need education and counseling on a range of nutrition issues. 
We request $50,000 for nutrition services for our diabetes patients. In 
addition, our diabetes patients need preventative and acute foot care. 
We seek $18,000 to contract with a podiatrist to promote healthy foot 
care among our diabetes patients.
                               education
    A. Johnson-O'Malley program.--A key to the success of many of our 
students in the public school system is the Johnson-O'Malley program. 
Our JOM program provides needed counseling and support services--and 
study skills training--to about 475 students. There is no question that 
the personal attention provided by JOM staff has helped innumerable 
students complete high school and go on to higher education. But, over 
the past four years, funding for our JOM program has been seriously 
cut, diminishing our ability to provide the level of personal care that 
our students need and deserve. This year, the President is proposing to 
cut JOM again--this time by $1.1 million. We urge Congress to reject 
such a cut, and restore full funding for the JOM program.
    B. Mashkisibi School.--Over the years, we have learned at Bad River 
that not all of our students thrive in a typical public school 
environment. Some students--particularly those with a history of 
difficulties in the public schools as a result of emotional or other 
problems--need an alternative environment. At Bad River, we have taken 
the initiative to address the needs of these children--by establishing 
the Mashkisibi School, an alternative school for grades 9-12. The 
School, established in 1995, serves 12 to 15 students each year. These 
are students who would drop out if public school was their only option. 
The Mashkisibi School seeks to engage these students by integrating 
Ojibway language and culture into all aspects of the curriculum, and by 
focusing on the practical impact of all areas of learning. The School 
also provides a higher teacher/student ratio than the public schools, 
and seeks to provide a more personalized approach to learning. The 
School has demonstrated considerable success, keeping these children in 
school, and helping them to thrive.
    We have had no federal funds supporting this worthwhile endeavor. 
While we have been able to begin the School on a shoestring, to be able 
to survive in the long term, we will need federal support. To operate 
the school--providing salary to our fine staff--we need $82,000 for 
fiscal year 1998. And, to have a proper facility for our School, we 
need $200,000. We recognize that there is currently a moratorium on new 
BIA funded schools. But, in this case, where the Band has stepped in to 
educate a segment of the student population that was not otherwise 
receiving the services needed to keep them in school, an exception 
should be made.
                           natural resources
    Our natural resources are key to our cultural and economic survival 
as a people. Wild rice, deer and walleye are central to our lives, and 
subsistence use of these resources is widespread and increasing. The 
population on our Reservation has grown sharply over the past few 
years, as our members return from urban areas. Unfortunately, 
employment has not kept pace. With greater numbers of tribal members 
and too few jobs on the Reservation, more stress is placed on our 
finite natural resources. Proper management and enforcement efforts are 
more critical than ever to preserve the integrity of our Treaty rights 
and resources for members of the Band.
    In 1995, the Band entered a cooperative agreement with the State of 
Wisconsin regarding subsistence and commercial fishing in Lake 
Superior. This agreement enhanced the practical opportunities for 
tribal members to exercise their Treaty rights in Lake Superior. At the 
same time, it has increased the Band's regulatory and monitoring 
responsibilities. Among other things, the Band is required to perform 
on-board monitoring and patrol activities. This requires the allocation 
of trained staff. Beyond the increased costs involved in these 
cooperative activities on Lake Superior, our overall fish and game 
program costs (cost of living, insurance, equipment, fuel, supplies, 
etc.) have been spiraling. We request an additional $50,000 to enable 
us to meet our responsibilities under the Tribal-State agreement and to 
protect our resources for future generations.
    We also support full funding for the Circle of Flight program and 
BIA Fish Hatchery Maintenance, and the restoration of funding for BIA 
Fish Hatchery Rehabilitation.
                          indian child welfare
    Our Indian Child Welfare staff works with the victims of child 
abuse and neglect, and with families at risk of child abuse and 
neglect. They investigate incidents, provide on-call services for 
crisis situations, and serve as advocates for children in the court 
systems. They provide educational services to families to prevent abuse 
and neglect.The program is also involved in the placement of
    Indian children. The staff undertakes home studies for foster care 
and adoptive care placements. They seek Indian adoptive homes for 
Indian children--to assure continuity within our tribal community. And, 
they protect the interests of Indian children and the Tribe, by seeing 
that the terms of the Indian Child Welfare Act are met. All of these 
critically needed services are being provided with a staff of 3 and 
federal funds of a meager $55,000. We urge you to provide additional 
funds for Indian Child Welfare programs--to help us limit child abuse 
and neglect, and to find suitable Indian families for our Indian 
children.
                            white pine mine
    The people and resources of Bad River face a significant threat 
from a proposed mining project at White Pine, Michigan. This project 
would involve injecting massive quantities of sulfuric acid into a 
copper mine in an effort to leach copper from the rocks. In preparation 
for mining activities, railroad cars filled with sulfuric acid have 
repeatedly crossed our Reservation on their way to the mine. Both the 
mining, and the transportation of the sulfuric acid, present terrible 
risks to our Reservation and our tribal members. Among other things, a 
spill of sulfuric acid would be a major catastrophe.
    Unfortunately, the proposal to undertake this mining is advancing 
rapidly. The owner of the mine, Copper Range Company, is seeking a 
permit from EPA to begin the solution mining activities. It is also 
seeking a permit to construct a smelter adjacent to the mine. And, EPA 
is currently undertaking an environmental analysis (EAn) to examine a 
broad range of issues associated with the proposed mine and related 
transportation.
    The Band needs resources to enable it to adequately participate in 
the permitting and EAn processes--to address the potential adverse 
impact of the mine and transportation activities on the Band, its 
resources and its members. We need expertise in the following areas (1) 
a transportation engineer, to evaluate the risk of a spill, (2) a 
mining engineer, to study safety issues relating to the mining 
activities, (3) an hydrologist, to study the potential movement of 
fluids in the groundwater, (4) an environmental toxicologist, to 
determine the adverse impacts of a potential discharge on plants, 
animals and humans, (5) a geochemist, to examine the interaction of the 
sulfuric acid and rocks, to determine if containment is possible, and 
(6) an economist, to determine the feasibility of the proposal to pump 
and treat fluids in the mine site forever.
    The Band requests $200,000 from the BIA for a mining assessment 
program to enable us to obtain baseline data and analysis and to be 
full participants in the permitting and EAn process. This participation 
is vitally important to the future of the Band, as a wrong decision on 
this mining proposal could jeopardize the health of our people and the 
integrity of our Reservation homeland.
                               conclusion
    We emphasize to the Committee that your work affects the lives of 
my people, and urge you to preserve adequate funding for Indian 
programs.
                                 ______
                                 

 Prepared Statement of Leonard Loretto, Governor of the Pueblo of Jemez

    Mr. Chairman and members of the Committee, I am Leonard Loretto, 
Governor of the Pueblo of Jemez in New Mexico. Thank you for the 
opportunity to testify before the Committee today concerning the Pueblo 
of Jemez.
           jemez irrigation project phase iii ($3.0 million)
    Farming is a fundamental part of the Pueblo's culture. We have 
grown corn and chili since prehistoric times. These products are not 
only a vital food source, but also necessary to our religious 
ceremonies. Our goal in this area is to maintain our culture and 
tradition and improve our economy by expanding our agricultural base.
    We need to complete the work on our irrigation system that is in 
the last phase of completion. We thank the Committee for its support 
for the first two phases. The first two phases have already resulted in 
a significant improvement in our farming capabilities due to the 
concrete lining of the main canals. This permits us to save water that 
was previously being lost through seepage. However, we still have more 
than 27 miles of lateral ditches that must be lined.
    As the Committee knows, the BIA priority list for theses types of 
projects results in only the large projects being funded. Last year, 
one irrigation project--the Navajo Irrigation Project--received more 
than $20 million in funding. While projects like Jemez's that is only 
one phase away from completion was left unfunded. We request the 
Committee to complete this work, by directing the BIA to provide enough 
money to complete Jemez's irrigation project. The benefits that this 
will produce for our People will be well worth the investment.
                  walatowa cultural center ($700,000)
    The Pueblo of Jemez wishes to enhance our tourism and outdoor 
recreation programs: (1) through the establishment of a Walatowa 
Cultural Center; and (2) by implementing the infrastructure required to 
accommodate outdoor enthusiasts who frequent the Holy Ghost and Dragon 
Fly fishing lakes. We are requesting $500,000 in support of 
construction of Phase 2, Walatowa Cultural Center, which is a 4,600 
square foot facility. We are further requesting and additional $200,000 
in support of infrastructure development for our fishing lakes.
    The establishment of the Walatowa Cultural Center for the Pueblo of 
Jemez will expand economic development potential through tourism by: 
(1) offering quality tourism attractions to the visiting public; (2) 
providing information which will facilitate a safe and enjoyable 
recreational learning experience; and (3) generating a higher 
expenditure per visitor, thus creating new revenue for the Pueblo. The 
establishment of the Cultural Center will support the preservation of 
tribal traditions, cultural values, arts and crafts and beliefs among 
new generations of Towa people.
                        bureau of indian affairs
Tribal priority allocations
    We strongly support the President's request for Tribal Priority 
Allocations. TPA funds the core services of every tribal government. It 
includes funding for education, welfare, roads and tribal courts, which 
are necessary for any sovereign to prosper. While, we strongly support 
the President's budget request, we echo the Senate Committee on Indian 
Affairs' concern that the funding for Indian programs has steadily 
declined since 1978. Thus, tribes are continuously forced to do more 
with less.
Social service funding ($126,000)
    In 1993, the Pueblo working with the Department of Justice 
developed a pilot project to address issues surrounding juvenile 
justice and delinquency. This project enabled the Tribe to work with 
its youth in a traditional counseling program. In addition, through the 
program we were able to assess the many factors that affect the life, 
styles and behaviors of our youth and develop solutions to the problems 
experienced by them.
    Since this program was initially only a three-year pilot project, 
DOJ did not renew the funding. When this project ended in 1996, the 
Pueblo was left without a specific program designated for youth. The 
Pueblo believes that this pilot program was a success and must be 
supported. We request an earmark of $126,000, to continue this valuable 
program. We are also concerned that while the BIA has created a line 
item for programs authorized under the Indian Child Protection and 
Family Violence Prevention Act, the BIA failed to request any funding 
for these programs. After several years, the BIA has finally completed 
the regulations for this Act. It is now time to fund the programs under 
this Act.
Detention facility
    We are pleased that the Administration recognizes the critical need 
for additional detention facilities in Indian country. We support the 
requests for the Ute Mountain and Gila River facilities. Even with 
these two facilities going on line, there continues to be a tremendous 
need for detention facilities in Indian country. In the Albuquerque 
Area, there are 19 tribes, yet there is no tribal detention facility to 
serve the needs of these tribes. As a result, our law enforcement 
agencies must contract with non-Indian agencies at a significant cost. 
This cost is shared 50/50 between the tribes and the BIA. Thus, 
contracting is not only costly to the BIA, but to the tribes as well.
    We would like to know the cost of contracting with outside 
detention facilities. While we are not certain, we believe that 
building a new facility may, in fact, be a more cost effective way to 
meet the detention needs in Indian country. We believe it would be 
helpful if this Committee requested such a report from the BIA.
Aboulselman case--water rights negotiation ($300,000)
    The Pueblo is a party in the United States v. Abousleman Stream 
Adjudication. This case, which involves the precious water resources of 
the arid Rio Jemez Basin, has been in litigation for well over ten 
years. Litigation is time-consuming, expensive and focuses on only 
reallocation of water supplies to parties to the litigation. The United 
States has already committed a water rights settlement negotiation team 
to help the Pueblo with these negotiations. To further the Pueblo's 
efforts in seeking a positive resolution of this matter the Pueblo is 
requesting an earmark of $300,000 from the BIA's Water Rights 
Negotiation Fund.
    In 1996, a tremendous amount of progress has taken place in the 
case. Specifically, because of the record drought this last summer, 
there was a call by the Pueblo and the United States to enforce senior 
priority rights. This forced the parties to the negotiation table. The 
Pueblos and the non-Indian irrigators negotiated an irrigation rotation 
schedule for the summer, which was approved and adopted by the federal 
court. This marked the first time in New Mexico history that the 
Pueblos and the non-Indian water users agreed to share the valuable 
water resource.
    Despite the tremendous progress that we have made in the Abousleman 
case the Bureau of Indian Affairs failed to provide any funding for the 
Pueblo to continue our work. Additional funding is essential to achieve 
the ultimate objective of a comprehensive negotiated water settlement 
in the basin. We request $300,000 be earmarked for the Pueblo to 
continue our work in the Abousleman case.
                         indian health service
Support for continued research on asthma among Jemez Children 
        ($100,000)
    A 1992 study by faculty from the University of New Mexico School of 
Medicine reported that the rate of acute asthma for children living 
within the Pueblo of Jemez is twice the national average. This is 
particularly alarming because it was previously thought that asthma was 
not a prevalent disease among Indian people. In 1996 the Pueblo of 
Jemez conducted baseline research on asthma and the relationship 
between our dependency on wood as a primary source of heating and 
cooking. Our preliminary research indicates that over 45 percent of 
households are significantly at risk to the effects of indoor air 
pollution. We request $100,000 to design and administer a comprehensive 
environmental health-epidemiological assessment to determine existing 
environmental factors which contribute to the known prevalence of 
asthma among Jemez tribal members, primarily focused on protection of 
our children and elderly.
Emergency medical services
    We request an increase in the IHS appropriations to provide for two 
additional full time emergency medical technicians to be stationed at 
the Pueblo of Jemez. Currently, 2,566 motorists pass through the Pueblo 
on an average day. This amount doubles during the peak tourist season. 
We are 45-50 miles away from the nearest hospital our EMT service is 
crucial to saving lives that would otherwise be lost. However, we 
cannot now provide twenty-four-hour emergency medical technicians, to 
ensure the health and protection of our visitors.
    We have only two EMT's and eight volunteers, serving as First 
Responders. They cover 415 square miles, including more than 100 of 
miles of isolated roads and tourist sites. Consequently, the First 
Responders answer most night and weekend calls, as the two EMT's are 
unable to meet these needs. While these individuals have done an 
excellent job with limited resources, two additional EMT's would allow 
the Pueblo to provide comprehensive emergency services, through trained 
professionals twenty-four hours a day seven days a week.
                                 ______
                                 

 Prepared Statement of Ruby Atwine, Chair, Tribal Business Committee, 
        the Ute Indian Tribe of the Uintah and Ouray Reservation

                              introduction
    My name is Ruby Atwine. I am the Chair of the Tribal Business 
Committee of the Ute Indian Tribe of the Uintah and Ouray Reservation 
located in northeastern Utah. I am providing this written testimony in 
support of the Department of the Interior's proposed appropriation for 
the Ute Tribe's water settlement. The proposed appropriation of $41.5 
million is partial fulfillment of the obligations and promises made by 
the United States to the Ute Tribe in 1965 and reconfirmed by Congress 
in 1992. Those obligations and promises are set forth in the Ute Indian 
Rights Settlement, Title V of the Central Utah Project Completion Act, 
Public Law 102-575, 106 Stat. 4600, 4650 (Oct. 30, 1992). The purpose 
of the Settlement is, in part, to settle long-outstanding claims held 
by the Tribe relating to the failure to construct features of the 
Central Utah Project contemplated in the September 20, 1965 Agreement 
between the Tribe, the United States and the Central Utah Water 
Conservancy District. This particular appropriation is to partially 
fund the Tribal Development Fund provided for in section 506 of the 
Settlement.
    The Ute Indian Tribe is pleased with the opportunity to present its 
views to this distinguished Subcommittee. The Tribe looks forward to 
working with the members to implement the proposed appropriation, which 
will provide a critical step in completing the funding of the Tribe's 
Water Settlement; funding which is vital to the economic development of 
the Tribe and its members.
                          the ute indian tribe
    The Ute Indian Tribe is made-up of three bands, the Uintah, 
Whiteriver and Uncompahgre. The Reservation is made up of two separate 
reservations: the Uintah Valley Reserve established in 1861; and the 
Uncompahgre Reserve established in 1882. Together they encompass nearly 
4.5 million acres of Indian trust, fee and federal land. The Tribe 
holds approximately 1,000,000 acres of Reservation land in trust. The 
Duchesne River and its tributaries, Rock Creek, Lake Fork, Yellowstone, 
Uinta and Whiterocks Rivers are among the stream systems that pass 
south from the Uinta Mountains through the Reservation to the Green 
River and then on to the mainstem of the Colorado River.
    Approximately 3,300 tribal members live on the Reservation. They 
suffer from the highest unemployment rate in the entire Uintah Basin. 
While the Reservation is blessed with oil and gas resources, employment 
opportunities are limited. Other ``modern'' employment opportunities 
are proscribed by the lack of additional economic development. The 
Tribe and a few tribal members do engage in agricultural enterprises 
which provide only limited economic returns. Fish and wildlife 
resources are extremely important to the Tribe and could, if properly 
developed and managed, offer greater economic opportunities.
                    the ute indian rights settlement
    The Ute Indian Rights Settlement was passed by Congress and signed 
by the President in October, 1992. The facts surrounding this 
Settlement make it distinct from other Indian water settlements. The 
United States had a contractual obligation to the Tribe which it failed 
to fulfill. The Settlement represents substitute consideration not 
enticement to enter a settlement of the Tribe's water rights.
    As I previously noted, in 1965 the Tribe, United States and Central 
Utah Water Conservancy District entered into what is commonly referred 
to as the Deferral Agreement. In the Deferral Agreement, the Tribe 
provided the United States and the Central Utah Project 60,000 acre-
feet of water annually to assure the funding and completion of the 
Bonneville Unit of the Central Utah Project. The Bonneville Unit of the 
CUP is the principal component of Utah's water supply future. It is one 
of the most complex and expensive transmountain diversion projects ever 
built by the Bureau of Reclamation. The project diverts water, 
including the 60,000 acre-feet made available by the Tribe, from the 
streams in the Uinta Basin and transports the water westward across the 
Wasatch Mountains to Salt Lake and Utah counties. In exchange for its 
substantial and essential contribution, the Tribe was to receive 
storage in two large dams and replacement water for the 60,000 acre-
feet made available to the Bonneville Unit. The dams were never built, 
the replacement water never delivered and, if the Settlement is fully 
funded, the 60,000 acre-feet of tribal water will continue to be 
transported annually across the Wasatch Mountains. The Settlement is an 
attempt to place the Tribe in an economic position similar to that it 
would have achieved had the promised structures been built and the 
promised water delivered. As funding is delayed, that goal remains 
unachieved and the opportunities promised (once again) unfulfilled.
    While the sums of money authorized in the Settlement and included 
in the Department of the Interior's proposed 1998 budget, may appear, 
to some, generous, they are in reality relatively small when compared 
to the unfulfilled promises made to the Tribe beginning over 30 years 
ago in the Deferral Agreement or to the enormous economic potential 
offered by the Bonneville Unit, which could not have been completed 
without the Tribe's contribution. To date, Congress has fully funded 
the Tribe's farming programs, found in section 504 of the Settlement, 
and partially funded various reservoir, stream and habitat improvement 
projects provided for in section 505. The Tribe has begun initiating 
the various farm and habitat improvement programs established in the 
Settlement and is in the process of developing its long-range plans for 
utilization of those funds. However, funding of the ``Tribal 
Development Fund'', the largest and most important program in the 
Settlement, was only initiated in fiscal year 1997, in an amount far 
less than is contemplated in the Settlement.
                      the tribal development fund
    Section 506 of the Settlement establishes a Tribal Development Fund 
``to be appropriated [in] a total amount of $125,000,000 to be paid in 
three annual and equal installments * * *.'' (Due to inflation factors 
statutorily applied to the 1992 authorization, the authorized amount 
has increased over the past four years to approximately $145 million.) 
In fiscal year 1997, Congress made the first appropriation for the 
Tribal Development Fund in the amount of $25 million. This 
appropriation, however, did not meet the statutory requirement of an 
equal one-third installment. Instead, Congress decided to reduce the 
appropriation and ``adjust'' future appropriations in accordance with 
section 506(b). That subsection provides that an adjustment will be 
made by the Secretary which represents the interest income ``that would 
have been earned on any unpaid amounts'' if Congress fails to fully 
fund the Development Fund in three annual and equal installments, It is 
the Tribe's understanding that the proposed $41.5 million appropriation 
for fiscal year 1998, includes an adjustment of approximately $1.5 
million. This amount represents the interest the Secretary has 
determined the Tribe would have received on approximately $23 million 
Congress failed to appropriate in fiscal 1997.
    The Settlement limits the Tribe to spending only the interest 
derived from the Development Fund on it economic projects. Moreover, 
the Tribe is required, under section 506, to prepare a Tribal 
Development Plan setting forth its economic development projects. That 
Plan must be approved by two independent financial consultants approved 
by the Secretary.
    Following receipt of the initial $25 million appropriation, the 
Tribe began a broad review and analysis of potential on-Reservation 
economic development programs. It soon became apparent that until 
funding of the section 506 Development Fund is complete, the Tribe 
cannot fully evaluate, develop or initiate a comprehensive plan to both 
create and foster economically viable enterprises on the Reservation 
and invest in outside economic ventures. It is vital, therefore, that 
funding of the section 506 Development Fund be completed as quickly as 
possible, albeit not in three equal installments, to allow the Tribe 
and its economic advisors to determine with some accuracy the amount of 
interest that will be available for project development on an annual 
basis. The Tribe can only develop a comprehensive, well planned 
economic development program that will provide the greatest possibility 
of success when it knows the amount available to the program for 
economic investment on a year-to-year basis.
              the proposed fiscal year 1998 appropriation
    The Tribe is fully aware of the fiscal constraints under which both 
the Department of the Interior and the Federal Government as a whole 
must operate. However, Congress clearly recognized and understood in 
1992, that it was essential to fully fund the Development Fund as 
quickly as possibly to foster economic development on the Reservation; 
economic development which should have begun over 30 years ago with the 
projects promised to the Tribe in the Deferral Agreement. The Fund is a 
critical component of the Tribe's efforts to secure economic self-
sufficiency in the future and that process cannot truly begin until 
funding is complete.
    The Tribe recognizes that in this time of fiscal constraint, the 
proposed appropriation of $41.5 million represents a substantial 
contribution of limited financial resources toward assuring full 
funding of the Tribe's Settlement as quickly as possible. The 
Department of Interior has recommended this appropriation within an 
overall $10 million reduction in the Indian Land and Water Claim 
budget. The Tribe appreciates the efforts of the Department and this 
Subcommittee on its behalf.
    It is important to recognize in reviewing this proposed 
appropriation, that $41.5 million falls short of what was clearly 
anticipated and promised by Congress in 1992. It does not amount to a 
full one-third of the overall authorization and it does not replace the 
shortfall in the 1997 appropriation. At the present rate, the Tribe 
estimates that it will take four to six years, fiscal years 2000-2002, 
before the Development Fund is fully funded. Until then, the Tribe can 
only initiate an extremely limited economic development program that 
will fall well short of that envisioned by the Department of the 
Interior and Congress and is vital to the Tribe and its members.
                               conclusion
    On behalf of the Tribal Business Committee of the Ute Indian Tribe 
of the Uintah and Ouray Reservation, I would like to express my 
gratitude to the Subcommittee for this opportunity to present the 
Tribe's statement in support of the proposed $41.5 million water 
settlement appropriation for the Ute Indian Tribe. The Tribe and the 
United States have worked together for many years to assure that the 
Tribe would at least receive the economic benefits promised when it 
provided water to assure the construction of the Bonneville Unit of the 
Central Utah Project. We are now close to completing what has been a 
long process. The proposed appropriation of $41.5 million is a critical 
step in bringing this matter to a close and fulfilling the obligations 
undertaken by the United States in 1965 and reaffirmed by Congress in 
1992.
                                 ______
                                 

 Prepared Statement of Andrew Grey, Chairman, Sisseton-Wahpeton Sioux 
                    Tribe, Lake Traverse Reservation

    My name is Andrew J. Grey, Sr., and I am Tribal Chairman of the 
Sisseton-Wahpeton Sioux Tribe. Our Tribe currently has over 11,200 
enrolled members and more than 5,500 of them live on the Lake Traverse 
Reservation in Northeast South Dakota and Southeast North Dakota. More 
than half of our reservation population is 18 years of age or younger.
    The Tribe currently employs more than 1,300 persons and is the 
largest single employer in the area. However, our unemployment rate 
still exceeds 30 percent.
    Our economy and jobs base is becoming increasingly diversified, but 
the Tribe is still overly dependent on jobs in our gaming industry and 
government services. Major efforts are underway to expend our small 
business sector, add manufacturing facilities to our economic mix and 
more fully utilize our land and natural resources to create jobs and 
generate income. By the year 2000, we plan to have 40 percent of our 
jobs outside of gaming and government services.
    Federal funds not only serve a Tribal function in our economic 
diversification efforts, but they are also essential in providing basic 
services to our members. That is why I appreciate this opportunity to 
provide testimony on the Bureau of Indian Affairs fiscal year 1998 
budget request.
    Our staff has analyzed the BIA's proposed budget, and although it 
provides for an increase in current funding levels, it contributes 
little to restoring the substantial losses that tribes have suffered 
since fiscal year 1994.
    Before I discuss the specific impact of current funding levels and 
the BIA's proposed fiscal year 1998 budget on our Tribe and its people, 
I will make some general observations on BIA funding in ``Indian 
Country,'' including the Lake Traverse Reservation.
    Historically BIA budgets proposed by past Administrations (and 
President Clinton's) have often provided for increases, but those 
increases have generally gone to support the BIA's Central and Area 
Office functions and staff. Few new or additional dollars actually 
reached the tribes or local BIA agencies.
    We appreciated the attention Assistant Secretary for Indian 
Affairs, Ada Deer, paid to this issue in her recent testimony, but we 
remain very skeptical of her claims relative to ``streamlining'' the 
BIA structure. Our view is supported by the fact that the fiscal year 
1988 budget includes for both the Central and Area Offices.
    I must also note that the fiscal year 1998 budget also provides for 
a $76.5 million increase for Tribal Priority Allocations (TPA), 
supposedly those funds go directly to tribes via Self Governance 
Compacts or Public Law 93-638 contracts. However, the increase when 
shared by 550 tribes, becomes quite minimal, particularly when local 
tribal allocations have historically decreased almost every year 
previously. Simply, the proposed funding increase does not restore 
prior losses.
    In addition, the population and employment data used to justify or 
demonstrate local need is frequently outdated and based on US Census 
information derived from substantial under counts of Native people on 
reservations. For example, almost 30 percent of the people living on 
our reservation were not counted in 1990. We are currently completing 
our own census and would like to contract the US Census for our 
reservation in 2000.
    Finally, the BIA's efforts to promote Public Law 93-638 contracting 
and Self Governance Compacts are laudable, but until tribes are 
convinced that all federal departments and agencies accept and clearly 
demonstrate their trust responsibility to and for tribes, most tribes 
will continue to believe that any diminishment of the BIA's role and 
function diminishes the Federal Government's trust responsibility.
    This assumption is supported by the fact that only 60 of the 550 
federally recognized tribes (after five years) have entered into Self 
Governance Compacts and only an additional 10 tribes will be added in 
fiscal year 1998.
    There is also little financial incentive for tribes to seek 
compacts, unless Tribal Shares (residuals) from Area and Central Office 
budgets are included. It will be very difficult to develop an equitable 
process in this regard, however, because residual funds have already 
been committed to 60 tribes based on a tribe-by-tribe approach and not 
an approach that includes all or most tribes.
    Our Tribal members (by referendum vote) have also rejected Self 
Governance, in part for those reasons. On the other hand, the SWST has 
taken full advantage of the contracting options and we have sixteen 
contracts with the BIA and a Master Contract with the Indian Health 
Service (for six programs) that total over $2.2 million.
    With that perspective in mind, let me now address the specific 
situation on the Lake Traverse Reservation.
    First, virtually all of our Public Law 93-638 contracts, 
historically, have been under funded and are usually further reduced 
each year. My comments, however, will be limited to the last two years 
of BIA allocations to our reservation.
    Between fiscal year 1996 and 1997, our Land Operations. Agriculture 
and Fish and Wildlife and Parks (contracts) programs have suffered the 
most severe reductions. Funding support has been cut over 40 percent, 
resulting in the elimination of tow full time positions and the 
conversion of five other to part-time, seasonal jobs. We've also had to 
return our lease compliance contract to the BIA.
    In addition, our Natural Rights Protection contract has been cut by 
almost 25 percent since fiscal year 1995 and only $11,000 is now 
available, hardly enough to hire staff or mount a credible program. The 
funds currently augment our National Resources Planning activities.
    Fortunately, our Tribal Realty staff are supported by land lease 
income and are not effected. These cuts have seriously undermined the 
Tribe's efforts to protect and manage its natural resources, including 
its agricultural lands. According to the BIA's fiscal year 1998 budget 
each of these areas is set for an increase, but we assume little of the 
money will reach us.
    The funds for our Tribal Court have been cut by 15 percent in the 
last tow years resulting in delays, backlogs, increased caseloads, and 
reduced services. We are already operating with a part-time Judge and 
prosecutor. Our Tribal Court currently operates on an annual budget of 
$188,500. Again, since the BIA's 1998 budget provides for only a slight 
increase in this area, we expect little improvement at the local level.
    Our Law Enforcement Agency is also seriously under funded, but BIA 
funding has been relatively stable for the last two years. Law 
Enforcement is scheduled for a substantial increase in the BIA's 1998 
budget, so we encourage the Congress to support it and target all of it 
to reservations.
    The SWST also needs a new detention (law enforcement complex) 
facility, but we recognize that even though the BIA's 1998 construction 
budget proposes an increase for detention facilities, the urgent demand 
far exceeds the recommended $16.5 million.
    Education continues to be a SWST priority and the BIA's budget does 
provide for increases for tribal schools (K-12) and Community Colleges. 
We have both a Tribal School and Community College, so we urge 
Congressional support for the requested increases.
    However, we are discouraged that the BIA's support for new school 
construction since fiscal year 1996 has decreased substantially. We 
need to replace a substandard, deteriorating facility now and are 
prepared to commit Tribal resources to that effort. Construction on the 
$10.325 million complex can begin this year, but we need the $1.5 
million that's available to Sisseton in the BIA's Facilities Management 
and Construction budget to match $1.5 million from the Tribe. A 
replacement facility for Sisseton was on the BIA Priority List (6) as 
early as 1990. We also intend to seek a direct appropriation from 
Congress and issue revenue bonds for the remainder of the costs.
    Relative to the BIA's lack of support for Economic Development, we 
strongly oppose the earlier elimination if its grants and technical 
assistance programs and we oppose its current plans to further reduce 
its funding for Economic Development in fiscal year 1998. In addition, 
the level funding (with inflation) proposed for its guaranteed loan 
programs will have limited impact due to the continuing needs of 550 
tribes. Most tribes do not have revenues from gaming or the leasing/
sale of natural or mineral resources to support economic development.
    We do support the BIA's request for increased funding for Services 
to Children. Elderly and families. but we join with most tribes in 
opposing the transfer of this program (function) to the TPA system. 
There's already too little TPA money to go around at the local level 
and adding another priority to the list would only make a difficult 
situation worse. In addition, these funds have the greatest direct and 
immediate impact on the most vulnerable of our people and perhaps most 
clearly demonstrates the Federal Government's trust responsibility to 
all of us. The responsibility to adequately fund this function should 
remain with the BIA.
    In conclusion, our response to the BIA's fiscal year 1998 budget 
proposed is mixed and we remain skeptical of many of its claims (e.g., 
streamlining) and intentions. However, we encourage the Congress to 
provide increased funds to support priorities I outlined in my 
testimony.
    Our own particular interest is to have at least the $380,000 that 
we lost in the last two years restored to our Public Law 93-638 
contracts and the local (BIA) agency's operating budget. We also 
urgently request that the Congress provide an fiscal year 1997 
supplemental appropriation of $150,000 to reimburse the SWST and the 
local BIA agency for those cost incurred (and not budgeted) in 
responding to our recent Winter emergency. These are costs that will 
not be reimbursed by FEMA.
    I appreciate your time and attention.
                                 ______
                                 

    Prepared Statement of Joe Moses, Chairman, Tribal Council, the 
     Confederated Tribes of the Warm Springs Reservation of Oregon

    Mr. Chairman, I am Joe Moses, Chairman of the Tribal Council of the 
Confederated Tribes of the Warm Springs Reservation of Oregon. Our 
address is P.O. Box C, Warm Springs, Oregon, 97761. My testimony, 
submitted for the record, addresses the proposed fiscal year 1998 
appropriation for the Bureau of Indian Affairs with the following 
requests and comments:
    (1) Adopt the BIA Tribal Priority Allocations budget, which 
restores the program to approximately fiscal year 1995 levels.
    (2) Increase BIA Construction Resources Management Survey and 
Design by $3 million for tribal and BIA participation in hydroelectric 
relicensing activities before the Federal Energy Regulatory Commission.
    (3) Reject ``means tested'' distribution of BIA funding, an 
``Istook'' amendment, and other legislative policy riders on 
appropriations bills.
    (4) Do not use the appropriations bill to carry out any part of the 
Strategic Plan to Implement the Reforms Required by the American Indian 
Trust Fund Management Reform Act of 1994.
    Below, I discuss each of these requests in further detail
(1) Adopt the BIA Tribal Priority Allocations budget, which restores 
        the program to approximately fiscal year 1995 levels
    The B.I.A. Tribal Priority Allocation (T.P.A.) budget is the heart 
of BIA support to tribes. These funds are spent at the local level 
according to specific tribal priorities. They fund essential tribal 
governmental functions and on-the-ground services to the Indian people. 
For years, tribes have sought to achieve some measure of stability in 
this critical part of the Bureau's budget so they may have some 
programmatic and administrative consistency from year to year. Just a 
few years ago, we thought a significant step had been made toward that 
end with the adoption of the B.I.A. Tribal Budget System, the central 
purpose of which was to provide tribal governments with stable 
recurring funding, flexibility, and tribal control. It was understood 
by many of us that, within the Tribal Budget System, T.P.A. was 
supposed to be the most reliable portion of the B.I.A. budget. Despite 
that, in recent years, T.P.A. has been funded at levels exceptionally 
below the fiscal year 1995 level. Now, for fiscal year 1998, the 
Administration's proposed budget for T.P.A. will roughly restore this 
critical program to that fiscal year 1995 level, with a very small 
increase for increased personnel costs over those years. It does not, 
however, reflect any cost-of-living adjustment for the remainder of the 
program. We urge the Committee to, at the very least, accept the 
Administration's T.P.A. budget proposal of $757 million.
(2) Increase BIA Construction, Resources Management Survey and Design 
        by $3 million for tribal and BLA participation in hydroelectric 
        relicensing activities before the Federal Energy Regulatory 
        Commission
    Over the next ten to fifteen years, federal licenses for 
hydroelectric projects involving close to 50 Indian tribes will expire 
and come up for renewal before the Federal Energy Regulatory 
Commission. Under the Federal Power Act, the Department of the 
Interior, as trustee for Indian land and water, is obligated to 
directly participate in those relicensing activities to establish 
appropriate conditions within the new licenses. Because these 
proceedings are of a quasijudicial nature, the Department of the 
Interior must develop and present expert testimony on a very wide range 
of highly technical issues.
    In addition, the affected tribes may very well seek to become 
involved in the relicensing proceedings on their own behalf, and many, 
because of the expense of such proceedings, must look to the Bureau of 
Indian Affairs for some assistance. Our Tribe is confronting this exact 
situation. We are in the hydroelectric business and are joint licensees 
with Portland General Electric on the Pelton Project, which 
substantially occupies our Reservation. The current license expires in 
2001 and the Tribe has already formally engaged the F.E.R.C. 
relicensing process by filing a Notice of Intent to seek the license. 
We estimate the effort will cost $4 million between now and 2001. We 
will be able to cover about two thirds of those expenses, but must seek 
Bureau help if we are to mount a credible application.
    In fiscal year 1997, the B.I.A. requested a budget increase of $4.5 
million to provide for active participation in the F.E.R.C. relicensing 
proceedings. Only $500,000 of the request was appropriated. For fiscal 
year 1998, the B.I.A. has scaled back its request to an additional $1 
million. We support that increase and request additional funding of $3 
million, to bring funding for this critical trust function to the level 
of need anticipated by the Bureau. The funding is essential if the 
Interior Department is to comply with the Federal Power Act and its 
trust responsibilities to the tribes, and if the tribes are to become 
less dependent on federal assistance by more completely realizing the 
economic benefits of hydroelectric projects involving their resources.
(3) Reject ``means tested'' distribution of BLA funding, an ``Istook'' 
        amendment, and other legislative policy riders on 
        appropriations bills
    Mr. Chairman, in recent years, a perception has arisen that Indian 
tribes are suddenly wealthy, and that, in this time of federal fiscal 
constraint, federal appropriations to these ``wealthy'' tribes ought to 
be curtailed. This is referred to as ``means testing'', and I want to 
urge you to resist it on three basic grounds: tribes generally are not 
wealthy, it would be discriminatory, and it would be contrary to our 
treaties.
    First, Indian tribes are not wealthy. By almost any measure, Indian 
people today are still among the most needy in the United States. The 
perception that tribes are suddenly wealthy is attributable to the 
overblown press coverage of a few, perhaps a dozen or so, tribes that 
have found substantial success in gaming. For most other tribes 
engaging gaming, such as ourselves, returns are far less spectacular, 
and most frequently offer only modest or marginal benefits. Most tribes 
still operate on budgets that are anemic compared to those of 
counterpart towns and counties.
    To the degree that gaming does provide some measure of financial 
benefit to tribes, it may also be short-lived, under constant challenge 
from states, the non-Indian gaming industry, and some elements in 
Congress. If gaming is eliminated or diminished, tribal economic 
circumstances will revert right back to their former status, which is 
far from vigorous. So, it would be mistaken and shortsighted to limit a 
tribe's appropriation based on the perception that it is somehow 
wealthy.
    Second, the distribution of federal funding to tribal governments 
based on their relative financial success, or lack thereof, would be 
discriminatory, not only among the tribes, but between the tribes and 
states and other units of government.
    Third, determining a tribe's funding on its comparative wealth is 
contrary to the treaties. Treaties are binding agreements for tribal 
cession of vast tracts of land and peaceful settlement on reservations 
in exchange for U.S. protection and support. That support is not 
contingent upon wealth or poverty, and for the U.S. to now propose 
withdrawing from part of those agreements because it asserts the tribes 
can somehow afford it is a unilateral violation of the intention of the 
treaties.
    We further urge that the Committee resist attempts to add other 
legislative ``rider'' amendments onto the fiscal year 1998 Interior 
Appropriations bill, specifically including any ``Istook'' type 
amendment to force tribes to sign agreements with states and local 
governments for the collection of sales and excise taxes as a condition 
of having any new lands placed in trust. Last Congress, Rep. Ernest 
Istook had such an amendment added to the House Interior Appropriations 
bill on a very close vote, and it was dropped from later versions of 
that legislation. In this Congress, Rep. Istook has recently introduced 
a very similar free-standing bill. Today, as last year, we very 
strongly oppose such legislation. The Istook amendment is a direct 
intervention of not only states, but undefined ``local'' governments as 
well, into the unique Constitutionally-based government-to-government 
relationship between Indian tribes and the United States. Pursuant to 
long-established laws and treaties, the Federal government has the 
responsibility to designate, hold, and protect land for Indian tribes. 
Rep. Istook's amendment, mandating the intrusion of state and local 
governments into that relationship, drastically alters a fundamental 
principle of tribal government and its relationship with the U.S. Such 
a proposal is highly objectionable to tribes on its face, and the 
prospect of having it moved as an amendment, without hearings or the 
full discourse of Congressional debate, is especially objectionable.
    Moreover, Rep. Istook's provisions are unnecessary. Rep. Istook, 
actively backed by commercial special interests, has grossly 
overdramatized the subject of his amendment. Just like most neighboring 
states with differing sales and excise tax structures, a great many 
tribes and states have voluntarily entered agreements to address the 
situation that Rep. Istook asserts demands the heavy-handed intrusion 
of big government.
    Amendments such as Rep. Istook's particularly serve to highlight 
the distortions and shortcomings that arise when legislating by rider. 
Accordingly, we ask that the Committee resist such legislative 
amendments, which not only complicate and cloud the appropriations 
process, but which also dismiss the standards of Congressional 
procedure and deliberation.
(4) Do not use the appropriations bill to carry out any part of the 
        Strategic Plan to Implement the Reforms Required by the 
        American Indian Trust Fund Management Reform Act of 1994
    Finally, Mr. Chairman, our Tribe recently received a copy of the 
draft ``Strategic Plan to Implement the Reforms Required by the 
American Indian Trust Fund Management Reform Act of 1994''. While 
certain aspects of the plan have merit, we are concerned that other 
aspects need considerable study. The most significant item proposed in 
the draft is the creation of an independent organization, outside the 
Department of the Interior, which would assume all trust asset 
management functions, including natural resources. This proposal needs 
considerable review and examination. In that regard, we strongly urge 
restraint in any appropriations actions which would implement any 
portion of the proposal as it relates to removal of further functions 
from the Bureau of Indian Affairs. We expect to continue our review and 
actively participate with other tribes in evaluating the plan. As you 
know, plans for Indian Country of the past have not worked well when 
they don't have the full participation of the tribes in their 
development. We will expect to communicate further with your Committee 
as the process moves forward.
    That concludes my remarks. Thank you.
                                 ______
                                 

   Prepared Statement of Hon. Ismael John, Senator, Nitijela of the 
 Marshall Islands; and Hon. Neptali Peter, Mayor of Enewetak Atoll, on 
        Behalf of the Enewetak/Ujelang Local Government Council

    Mr. Chairman and distinguished members of this Subcommittee: Thank 
you for providing this opportunity to the people of Enewetak to 
describe issues relating to food production and the environmental 
situation on Enewetak Atoll. We would also like to inform you of the 
initiatives we have taken these past few years to improve not only food 
production but also the health and education of our people. These 
initiatives include a complete overhaul of our agriculture program; the 
institution of a nutrition education program; the renovation of a three 
story building which now houses our sixteen classroom elementary 
school; the hiring of two highly qualified American teachers to help us 
with our education effort; and, attempts at the economic development of 
our atoll to permit fishing and/or tourist activity.
    Mr. Chairman, at the outset we wish to express our gratitude to the 
United States Congress for the appropriation of funds these past ten 
years to provide food to our people through a program which has become 
known as the Enewetak Food and Agriculture Program. We are also 
grateful that the Administration has included funding in the amount of 
approximately $1.091 million for the Enewetak Food and Agriculture 
Program in its fiscal year 1998 Budget. However, we must note that the 
$1.091 million in the Administration's budget is the same amount as the 
amount appropriated in fiscal year 1987. That is, the funding for the 
program has substantially declined these past 10 years in real dollars. 
Applying a 3.5 percent inflation factor, the $1.091 million 
appropriated in 1987 now has the purchasing power of approximately 
$700,000. In short, the program over the years has experienced over a 
35 percent cut in funding. At the same time our population has 
increased from approximately 1,000 persons to over 1,400 persons. We 
have been successful in employing strategies to cut costs and to 
maximize the funds available to us. However, in order for the program 
to achieve its intended purpose, funding needs to be increased to at 
least keep pace with inflation. Consequently, we ask that the amount of 
$1.5 million be appropriated by this Subcommittee for the Enewetak Food 
and Agriculture Program to reflect the impact of inflation on the 
$1.091 million over the past 10 years. (Applying a 3.5 percent 
inflation factor to the $1.091 million for the past ten years results 
in an amount of approximately $1.5 million.)
    In addition, we note that authorization for funding of the Enewetak 
Food and Agriculture Program expires at the end of fiscal year 1997. We 
trust that the Congress recognizes the necessity and importance of 
continued funding of the food and agriculture program to assist the 
peoples affected by the United States Nuclear Testing Program. 
Accordingly, we trust that the Congress will amend Section 103(h)(2) of 
Public Law 99-239 (Compact of Free Association Act of 1985) to 
authorize funding for an additional five years, through fiscal year 
2001.
    Below, we briefly describe why the Enewetak Food and Agriculture 
Program is necessary, and report to you efforts made by us to put these 
funds to the best possible use.
              cleanup of residual radiation contamination
    Our objective is the cleanup of Enewetak Atoll from radiation 
contamination to a level which would allow full and unrestricted use of 
our atoll. This objective would permit us to feed and house our growing 
population and would permit us to pursue economic development.
                           present situation
    Between 1977 and 1980 the United States undertook to rehabilitate 
Enewetak from the devastation and radiation contamination which 
occurred as a result of nuclear weapons testing conducted by the United 
States. Forty-three nuclear devices were exploded on the atoll 
including the first thermonuclear device (hydrogen bomb) detonated by 
the United States. Although that rehabilitation effort was a good 
start, it remains unfinished. We presently have use of less than 50 
percent of our atoll for living and food producing purposes. Even that 
figure is misleading because of the poor soil conditions of the 50 
percent of the land available to us. The soil is in poor condition 
because most of it was covered by asphalt and concrete during use of 
Enewetak by the United States for nuclear weapons testing.
                 enewetak food and agriculture program
    The Enewetak Food and Agriculture Program enables us to live on 
Enewetak. It provides funding for imported food, continued agriculture 
rehabilitation, operation of a motor vessel which brings us the 
imported food, a nutrition education program, and an operation and 
maintenance component conducted out of a facility on Enewetak known as 
the field station.
    1. Efforts made to increase food production. As we previously 
explained to this committee, we were unhappy with the state of the 
agriculture rehabilitation program when we inherited the program from 
the Department of Energy. Accordingly, in 1993 we had an assessment of 
our agriculture situation conducted by experts affiliated with 
universities in the Pacific. The purpose of such assessment was to 
determine the current agriculture situation and to develop a plan for 
increased food production. The plan was completed and implementation of 
a new program occurred in late summer 1993. The most significant aspect 
of the program is the reinfusion of nutrients into the soil. This is 
accomplished by digging trenches and placing organic material in the 
trenches along with a compost mixture of copra cake and chicken manure. 
The reinfusion of nutrients into the soil is extremely labor intensive 
and requires the importation of copra cake and chicken manure. Although 
the work is progressing, additional funding is required to provide 
greater manpower and the necessary equipment, materials and supplies. 
The inflation adjusted funding of $1.5 million as requested in this 
statement would greatly assist in accelerating the agriculture 
rehabilitation of the atoll.
    2. Importation of food. Imported food is required because of the 
poor soil condition of the land available to us and the radiation 
contamination of other lands. Since we have taken over the program we 
have increased the quantity of imported food by 50 percent without any 
increase in the overall program budget. We have accomplished this by 
utilizing bidding procedures for food purchases; elimination of 
transportation charges by use of our motor sailer (Wetak II); 
elimination of import tax on food; and reduction of other program 
expenses.
    3. Nutrition education program. Since our people cannot rely on 
traditional foods we must import food, the nutritional value of which 
is unfamiliar to us. Several years ago we became aware that some of our 
people, particularly our children, suffered from malnutrition. 
Accordingly, we instituted a nutrition education program. We are 
pleased to report that we have been apprised by physicians that 
malnutrition among our children has been greatly reduced.
    4. Wetak II (waterborne transportation). The Wetak II, a fifty foot 
motor sailer, is used to primarily transport our imported food 
purchases and agriculture material from the region to Enewetak. Food 
and agriculture material is transported from Majuro, a distance of 600 
miles from Enewetak. We are extremely proud of the hard work and 
perseverance of our local crew and local captain in carrying out this 
assignment. Transportation in this manner permits us to save 
substantial shipping costs.
    5. Field Station. Operation and maintenance of the entire program 
is conducted out of a facility referred to as the Field Station. The 
machinery and equipment required by the agriculture, food and 
transportation components of the program are kept at the Field Station. 
Field Station personnel provide all the required agricultural work; 
maintain, service, and operate the equipment required by the various 
components of the program; make payments and maintain books of 
accounts; and coordinate the procurement of food, material and 
equipment. The overall manager of the program is Johnson Hernest. Other 
management personnel include Samson Yoshitaro and Mathan David. The 
program employs 39 full and part-time employees.
                radiological monitoring and health care
    We have noticed an increase in the incidence of thyroid nodules and 
cancers in our population. Accordingly, we must be assured that our 
people are adequately monitored on a whole body basis and for plutonium 
inhalation or ingestion. Similarly, we must be assured that the 
environmental monitoring of residual radionuclides in the soil continue 
at the frequency and type of work indicated by Lawrence Livermore 
Laboratory. We also note that we were told that the Defense Nuclear 
Agency was curtailing its monitoring activities of the Runit nuclear 
waste containment site (the Dome). We consider the monitoring of the 
Runit dome to be a continuing responsibility of the United States. 
Accordingly, we asked that an agency of the U.S. assess the current 
condition of the dome and its effect on the surrounding environment. In 
addition, we asked that a plan for the long term monitoring of the dome 
be developed. We understand that the assessment work has begun. We 
trust that the remainder of our request will also be undertaken by the 
United States.
    Our concerns regarding the exposure of our people to radiation is 
underscored by our belief that we were contaminated by radiation from 
the fallout of the 1952 Mike test while we were living on Ujelang 
Atoll. This belief, and the fact that our people reside on an atoll 
that contains residual radiation, emphasizes the need for better 
monitoring and better medical care of our population than has occurred 
to date. We are included in the 177 Health Care Program (also known as 
the Four Atoll Health Care Program). However, that program is burdened 
by an enrollment of over 11,000 persons which limits the medical care 
available to our population. In fact, the administrator of the program 
has calculated that the program is able to spend only $11 per person 
per month. Clearly, such an amount is inadequate to provide any 
semblance of adequate medical care let alone the type of care required 
by a population resettled on an atoll that contains residual radiation 
from the testing program.
                        environmental situation
    The issues that we have mentioned above are directly related to the 
environmental condition of Enewetak. We are trying to do the best we 
can with the little arable land available to us. However, the real 
issue for our long-term well-being is the environmental remediation of 
our entire atoll so that all of it can be used without fear of 
increased health risk from radiation contamination. We are aware of the 
commendable efforts made in the United States to cleanup radiation 
contaminated sites. Oakridge, Tennessee is undergoing environmental 
remediation at a cost of several hundred million dollars per year and 
cleanup is projected to require thirty years of such effort. Other 
sites such as Hanford, Rocky Flats and Los Alamos are just a few of the 
areas receiving environmental cleanup. We understand that the standards 
to which the contaminated areas in the United States are being cleaned-
up are standards much more stringent than those employed in the cleanup 
of Enewetak. For example, the dome on Runit island on our atoll is used 
to store radioactive material collected from throughout our atoll. We 
understand that the storage of such material in the manner stored on 
Runit would not be permitted in the United States. Furthermore, the 
dome is only a small portion of Runit. The remainder of Runit is 
contaminated with the extremely dangerous radioactive element, 
plutonium. Although we understand that the United States intended to 
cleanup those plutonium affected areas of Runit, no such cleanup ever 
took place. Worse, no effort was ever taken to ensure that adequate 
warnings, fencing and other methods generally used for the protection 
of people from contamination were maintained and/or put in place. We 
understand that this situation would not be permitted in the United 
States. Runit is but one example of how the cleanup methods used on 
Enewetak differ from those later employed in the United States. Another 
example is the level to which the land itself would be cleaned up to 
allow full and unrestricted use. The level of cleanup employed on 
Enewetak does not permit full and unrestricted use of large portions of 
our atoll. Our environmental situation must be addressed to permit us 
to make as much use of our atoll as possible.
                        education rehabilitation
    Several years ago we became concerned with the educational system 
on Enewetak Atoll. We had an assessment of our education situation 
conducted. As a result of that assessment, we hired two very qualified 
American teachers to assist us in upgrading our elementary school. We 
are very pleased with the development of our education program and the 
enthusiasm for learning that such program has engendered in our 
schoolchildren and community. In addition to a new and more effective 
education program, we rehabilitated a three story structure which is 
now used as a sixteen classroom elementary school for our 320 
schoolchildren. We are proud that our new school building is one of the 
finest such facilities in Micronesia.
                          economic development
    We are attempting to have Enewetak developed as a fishing base, 
fresh fish transhipment facility, and a tourist diving destination. 
Enewetak seems to be in a good location for such endeavors. In 
addition, there are some existing facilities (runway and fuel tanks) 
which could be upgraded to facilitate economic development. A 
feasibility study and business plan was completed for the fishing base 
and fish transhipment concept. We were negotiating with an interested 
private sector operator. Unfortunately, there was serious concern about 
the residual radiation on the Atoll and the perception in the Japanese 
market of radiation contamination on Enewetak atoll. This concern and 
perception about the residual radiation contamination at Enewetak 
presents a major impediment to economic development and underscores the 
need to finish the environmental clean-up of the Atoll. We hope to have 
cost figures for such remediation within the next twelve months.
                               conclusion
    In closing, we thank the Congress for funding the Enewetak Food and 
Agriculture Program and trust that it will give due consideration to 
the necessity for an inflation adjustment to that funding. We also 
trust that the issues describe herein, particularly the remediation of 
radiation contamination at Enewetak, will be addressed by the United 
States.
                                 ______
                                 

  Prepared Statement of the Circle of Nations Wahpeton Indian School 
                          Board (Wahpeton, ND)

    For over ninety years, the Circle of Nations Wahpeton Indian School 
has been an important place to people from many areas of the country. 
It is a tribal community within the town of Wahpeton, a traditional 
tribal meeting ground where three rivers bring together the Plains, 
Woodland, and Mountain cultures. The states of North Dakota, South 
Dakota, and Minnesota intersect here
    Tribal leaders count on this school to help families who are having 
troubles and whose children have not been able to get the services they 
need in their own home areas. The Circle of Nations School is a 
residential boarding school that offers special education, counseling, 
health and nutrition services in a 24 hour daily home living program 
for the nine-month academic year.
    The provision of education and health services to Indian people has 
been established by numerous treaties and agreements in United States 
history. This was recognized when the school was created by an act of 
Congress in 1904. The continued federal-lndian trust responsibility was 
underlined when the school converted from BIA to tribal control in 1993 
under Public Law 93-638, the Indian Self-Determination and Education 
Assistance Act. The school is now administered under a grant contract 
to the Sisseton-Wahpeton Dakota Nation.
    The school was made a therapeutic model with Public Law 103-382, 
the Improving America's Schools Act of 1994. This concept is a positive 
departure from the old boarding school system that has been widely 
criticized as a contributor to family dysfunction and cultural 
breakdown in tribal communities throughout the United States. But the 
concept must be staffed and funded to be carried out to its full 
potential.
    We, the school board, represent tribal nations with the largest 
populations of students enrolled at Wahpeton. The school board wishes 
to express their true and unequivocal support of the Circle of Nations 
School. The program at Wahpeton is our concentrated effort to create a 
sensible and cost-effective approach to problems that affect the future 
of our youth and our communities.
    ``It takes a village to raise a child.'' This saying is currently 
popular as the new answer to nationwide symptoms of social ills such as 
crime, drugs, poverty, illiteracy, diseases, and the breakdown of the 
family. This country's Indian people have always known that it takes a 
village. Today, the Wahpeton therapeutic residential school community 
is what must serve that purpose for many Indian children.
    There is no social or financial safety net that ensures that all 
Indian children will get adequate healthcare or educational assistance 
in their home communities. Having these programs all concentrated in 
one place, with a good school and highly skilled, dedicated workers is 
the only logical solution to the needs these children have.
    Students come to Wahpeton for reasons that are all too familiar 
with the Circle of Nations School. Homelessness is a common condition 
among students and their families, as are chemical dependency and 
mental health problems. Most students have been physically and/or 
sexually abused. Traumatic brain injury and learning disabilities are 
not an unusual factor in the mix. Some have major hidden health 
problems like FAS/FAE. It is impossible to diagnose all who are 
affected by fetal drug and alcohol exposure.
    All of these things have to be taken into consideration and 
addressed for each child. This takes a number of staff of different 
disciplines to teach and guide these students all around the clock for 
the whole school year. No student has just one problem that brought 
them to Wahpeton. They all come into play to put the student at risk. A 
few cases can be cited as an illustration of the sorts of challenges we 
are faced with as a school.
    One student was found living in an abandoned urban warehouse, 
physically abused and neglected by an alcoholic, mentally ill, and 
indigent parent. Indian Child Welfare found a foster placement in the 
student's home state, but the student could not adjust to the public 
school and was truant, using drugs and alcohol, and involved in gang 
fights. The student completed two school years at Wahpeton and 
experienced success in drug and violence prevention, sports, academics, 
social development and cultural activities. Meanwhile a suitable 
guardianship was arranged for the student's transition from CNS to the 
higher grades. Although the school gets many such applications from 
agencies trying to place students from similar circumstances, it is not 
realistic to admit a large number of these high-risk street kids 
without the resources to deal with them effectively.
    Most students have some degree of homelessness and frequent moves 
in their history. Families of students may move from place to place and 
use a relative's mailing address or phone for messages. Often students 
will try to call home after being at school for a period, only to find 
the phone disconnected. Parents who are forced to move feel that their 
children are safe at the school when family upheaval occurs.
    An example: Three siblings were enrolled at Circle of Nations 
School for the fall semester with a permanent mailing address given on 
the student admissions application. In the winter a story appeared in 
the state's largest newspaper which featured the students' homeless 
parents and older siblings living in a van. Yet the parents had always 
been in regular contact by phone and mail to the school.
    Another student came to Wahpeton from another state and soon began 
to get infractions for AWOL, chemical abuse, assault, and angry 
disruptions. The student was placed in a structured counseling and 
behavior program on campus. While counselors and social workers applied 
to various adolescent treatment programs and tried to elicit funds from 
various state, tribal, and federal entities, the student revealed a 
history of abuse in the household, which was ongoing. The alleged 
perpetrator lived in the household and was reportedly abusing other 
children. Although the abuse had been previously reported and 
investigated, the charges did not stick.
    The student feared to return home for the summer. No agency would 
take custody of the student even though the parent voluntarily 
relinquished custody. No state, tribe, or county would assume 
jurisdiction or responsibility for this child's welfare. No treatment 
center would accept the student for varying reasons. The Indian Service 
Regional Youth Treatment Centers in the student's home area rejected 
this student because the student's dual CD/mental health treatment 
needs were specifically outlined (the school had a psychological 
evaluation done for this student) and judged as too high. 
Unfortunately, this scenario is not atypical.
    For decades now the school has been a last resort for students with 
nowhere else to go. There are numerous success stories: teachers, 
scholars, administrators, business and professional people, actors, 
artists, public officials and senators. The present superintendent, an 
alumnus and graduate of the Wahpeton Indian School, knows well the 
experience of these students, having spent the year round through 
elementary and middle school grades. Developing children have time and 
resilience in their favor. If given the skills, they can learn how to 
cope and to pull themselves through life.
    Life today is more complicated for all children in this country. 
The students at Wahpeton need more specialized help than in the past. 
We would like our students to grow up to be successful. However, we 
realize that our task is to help students overcome difficulties that 
they already have, and prevent a costly outcome in the future. For 
without our ``village'' pitching in to raise the child, the child 
becomes an adult without a social conscience or the strength of spirit 
to be self-sufficient.
    It makes sense to pool resources at a residential school. In the 
ideal plan, the kind of funding that is concentrated on an isolated 
youth treatment center would instead be used to create a comparable 
center on campus for the youth who need it most. These students are 
going to end up requiring the use of different health, social service, 
and law enforcement services anyway, if they are left on their own in a 
problem environment.
    BIA and Indian Health Service funds and service do not follow these 
students to Wahpeton. Once removed from their home tribal areas, they 
will probably lose eligibility for Medicaid as well. Indian Health 
Service provides a school nurse and basic health service only. There is 
no psychiatrist, psychologist, or mental health clinician.
    The Circle of Nations School is requesting funds to further develop 
and staff the Behavioral Health Center on-campus. These are start-up 
funds for a program that has been operating on a small scale during the 
1996-97 school year. This program could pay for itself in five years if 
the necessary staffing and supervision were available.
    In this era of dwindling resources and budgetary cuts, the obvious 
solution is to consolidate and serve a population with the most 
potential benefit. This is the purpose of school reform and in 
agreement with the whole village, whole child concept.
                                 ______
                                 

Prepared Statement Lorene Willis, President, National Indian Education 
                              Association

    The National Indian Education Association (NIEA), the oldest 
national organization representing the education concerns of over 3,000 
American Indian and Alaska Native educators, school administrators, 
teachers, parents, and students, is pleased to submit this statement on 
the President's fiscal year 1998 budget regarding Indian education. 
NIEA has an elected board of 12 members who represent a broad cross-
section of the national Indian education community. NIEA's annual 
convention provides our members with an opportunity to network, share 
information, and hear from Congressional leaders and staff and federal 
officials on policy and legislative initiatives impacting Indian 
education.
    First, we want to commend President Clinton for a budget that 
emphasizes the importance of education for all American citizens, 
including the First Americans. His school construction and education 
technology initiatives are critically needed by Bureau of Indian 
Affairs (BIA)-funded schools. Yet, we must not forget that programs 
such as the Office of Indian Education (OIE) in the Department of 
Education (DOE), Impact Aid, and higher education scholarships deserve 
further consideration for possible increases. Our testimony will 
discuss Indian education and related programs administered by the BIA 
and the Indian Health Service (IHS) as well as the school construction 
initiative.
    Second, we have noted the transfer of funding for OIE programs from 
the Interior to the Labor-HHS-Education Appropriations Subcommittee. 
Prior to this development, OIE was the only DOE program funded from an 
appropriation other than Labor-HHS-Education, which often placed it at 
odds with the BIA's other priority programs. Our testimony also address 
OIE. We believe education is part of the federal trust responsibility 
regardless of what type of school--public or tribal--Indian and Alaska 
Native students attend.
                   a. bureau of indian affairs [bia]
    NIEA concurs with the BIA's fiscal year 1998 budget investment of 
$467 million for school operations. An additional $58 million is 
requested for Continuing Education, Tribal Priority Allocations (TPA), 
and Special Programs.
    Adult education.--Adult Education is a vital, yet continually 
under-funded, program that is desperately needed by adult American 
Indians and Alaska Natives who did not complete high school to help 
them obtain General Educational Development degrees (GEDs). The 
program's funding has decreased over the past three years to the fiscal 
year 1998 request level of $2.3 million--itself a $85,000 decrease from 
fiscal year 1997. All tribes need adult education programs and, with 
the elimination of OIE's Adult Education Program in 1997, funding for 
the BIA's program is critical. We urge a minimum of $4 million for BIA 
adult education in fiscal year 1998.
    Higher education scholarships.--NIEA supports the President's 
request of $29.5 million for higher education scholarships. This 
program provides grants to tribally-contracted programs to provide 
financial aid for eligible Indian and Alaska Native students attending 
accredited post-secondary institutions. While scholarships are based on 
need, the program funds about 25 percent of a student's need. However, 
the unmet financial need for Indian and Alaska Native students 
nationwide is about $80 million.
    Johnson-O'Malley (JOM) program.--The fiscal year 1998 request is 
$17.216 million, a $1.040 million decrease from fiscal year 1997 and a 
$7.143 million decrease from the fiscal year 1995 level of $24.359 
million. This is the only BIA program which provides for culturally 
relevant and supplementary academic needs of Indian children attending 
public schools. Given an increasing, rather than decreasing, student 
population, NIEA recommends funding for JOM at $24 million in fiscal 
year 1998.
    Indian school equalization program (ISEP) formula.--The President's 
fiscal year 1998 request is $296 million for this program, which 
provides formula-based funding for 185 BIA-operated, elementary and 
secondary contract and grant schools. The amount, representing a $10.5 
million increase over fiscal year 1997, would provide about $3,094 per 
Weighted Student Unit (WSU) compared to $2,904 per WSU in School Year 
(SY) 1996-97. NIEA continues to support a funding level of $3,500 per 
WSU, which we have recommended since fiscal year 1993. We note that the 
proposed $3,094 per WSU is still far below the average per student 
expenditure by public elementary and secondary schools of $6,300 per 
student in SY 1995-96 as reported by the National Center for Education 
Statistics (NCES).
    Family and child education (FACE) program.--The fiscal year 1998 
request of $5.5 million for this program is an amount that for two 
years has remained unchanged despite a growing population. It is also 
$1 million less than the enacted fiscal year 1995 level of $6.5 
million, itself a reduction by $1.1 million from fiscal year 1994. We 
urge funding for this program at the fiscal year 1995 level with a 4 
percent adjustment for inflation.
    Student Transportation.--NIEA supports the fiscal year 998 request 
of $34.3 million for student transportation. BIA-funded schools, which 
are located primarily in rural, isolated areas, remain well below the 
national average. According to the latest School Bus Fleet information, 
the national average for student transportation costs in SY 1993-94 was 
$2.94 per mile for public schools. But, the BIA-funded transportation 
cost in fiscal year 1996-97 was at $1.60 per mile for 15,197 miles 
driven for day and boarding schools--a difference of $1.34 per mile.
    Administrative Cost Grants.--NIEA supports the fiscal year 1998 
request of $44.7 million. With at least 10 of the remaining 49 BIA-
operated schools on the Navajo reservation indicating they will convert 
to grant status after July 1997, at a projected cost of $4.6 million, 
the BIA will need another $1.6 million for this expense. Severence 
costs may or may not be factored into the Administration's request, and 
there may be additional school conversions in fiscal year 1998.
    Education facilities operation and maintenance (O&M).--The fiscal 
year 1998 request for Facilities O&M is $74.6 million, a slight 
increase from fiscal year 1997. We support this level with misgivings 
because funding continues to fall below the level needed for this area.
    Tribal departments of education (TDOE's).--Since the President's 
budget fails to provide funding for this item, NIEA recommends at least 
$3 million for TDOE's, which are authorized by Public Law 103-382, the 
``Improving America's Schools Act.'' We believe sufficient funding 
should be provided to assist tribes to accomplish the original intent 
of the Act.
    Tribal Colleges/Post-secondary Schools.--NIEA supports the 
President's request of $29.3 million for tribally-controlled colleges 
operating grants, although the real need is about $40 million based on 
an estimated 6,815 Indian Student Count (ISC). NIEA also supports $2 
million for tribal college endowments, $2 million for economic 
development, and $1.8 million for emergency facility repair and 
renovations. In addition, tribal colleges have never received 
facilities construction or renovation/repair money from the BIA. While 
the national average for Full-Time Equivalent (FTE) funding at 
mainstream community colleges is approximately $6,200 per year, the 
level of FTE funding for some special population colleges is about 
three times that provided to the tribal colleges. NIEA also supports 
separate funding levels in fiscal year 1998 for BIA-funded post-
secondary vocational institutions including Haskell Indian Nations 
University at $8.1 million, Southwest Indian Polytechnic Institute 
(SIPI) at $4.6 million, the Institute for American Indian Arts (IAIA) 
at $5.5 million, and the United Tribes Technical College (UTTC) at $2.5 
million.
    Graduate scholarships.--The fiscal year 1998 request of $1.33 
million for the Special Higher Education Graduate Program, which is the 
primary funding source for American Indian and Alaska Native graduate 
students, is totally inadequate to help these individuals meet the 
costs of achieving an advanced degree. NIEA requests a funding level of 
$3 million for fiscal year 1998. The program, which is administered by 
the American Indian Graduate Center (AIGC) of Albuquerque, New Mexico, 
has been woefully underfunded for the last 3 years. For school year 
1995-96 the actual unmet need was $10 million. During the fiscal year 
1995-96 year the program funded an estimated 500 students at an average 
award of $3,300--considerably lower than the $6,750 per student award 
for fiscal year 1991-92. Scholarship awards have been decreasing 
despite an ever-increasing demand for these limited funds.
    Replacement school construction.--The fiscal year 1998 request of 
$14 million for Replacement School Construction is to complete the Many 
Farms High School on the Navajo reservation in Arizona. While we 
support this request, we must also point out that the current request 
list for new schools also deserve Congress's attention and support.
    Education facilities improvement and repair (FI&R).--NIEA supports 
the fiscal year 1998 request of $32.2 million for Education FI&R. 
Furthermore, since there is a backlog of over $600 million in this 
program, we request that Education FI&R be funded at the fiscal year 
1995 level of $34.3 million with a 4 percent adjustment for inflation.
                     b. indian health service (ihs)
    Indian health professions scholarships.--The President's fiscal 
year 1998 request is $28.3 million, a $1.5 million increase over the 
fiscal year 1997 enacted level. However, NIEA supports the National 
Indian Health Board's (NIHB) recommended level of $29.7 million. The 
Indian Health Professions Sections 103, 104, and 114 under Title I of 
the ``Indian Health Care Improvement Act'' provides authorizations to 
support scholarship recipients, loan repayment to health professionals, 
and temporary employment during non-academic periods.
    School-based health education programs (IHS and BIA).--NIEA 
successfully advocated in 1992 to obtain a new authorization in the 
Indian Health Care Improvement Act (IHCIA) to establish school-based 
health education programs. Our fiscal year 1998 request is $5 million 
for both programs ($3.5 million for IHS and $1.5 million for BIA). 
Under Section 215 of the Act, the Secretary of HHS is authorized to 
award up to $15 million in grants to tribes to develop school health 
education programs for reservation-based children in grades K-12 which 
could be set up in public, contract, grant and private schools. The 
Interior Secretary is directed to develop, in consultation with the 
Secretary of DHHS, a comprehensive school health education program for 
children ages pre-school through Grade 12 in BIA-funded schools. The 
Secretary of HHS is directed to do likewise within IHS.
    The curricula in BIA-operated schools would include programs such 
as nutrition education, personal health and fitness, mental health 
wellness, substance abuse prevention, safety education, and activities 
for the prevention and control of communicable diseases. The Interior 
Secretary is also directed to provide training in health curricula to 
teachers in BIA-operated schools to ensure coordination and integration 
with existing programs and services and to encourage tobacco-free 
school environments. The area of school health education currently 
receives minimal support from both the BIA and IHS. Through an intra-
agency agreement, IHS receives $230,000 annually from the Centers for 
Disease Control and Prevention (CDC) for school health education 
programs, which is the entire budget for this effort. Otherwise, BIA 
has no specific funds for this purpose. We urge the Committee to 
support funding for this authorization by at least $3.5 million for 
grants to tribes and $1.5 million for the BIA to fulfill its 
requirements under Section 215.
    HIV/AIDS prevention.--According to the CDC, there were 1,434 
reported and verified diagnosed cases of AIDS among Native Americans as 
of June 1996, approximately a 12 percent increase over the amount CDC 
reported in October 1995 (1,283). Although the CDC's announcement on 
February 27, 1997 that the number of deaths nationally from AIDS had 
declined, including a 32 percent drop among American Indians and Alaska 
Natives, it did not address the issue of individuals living longer with 
AIDS and needing long-term care. We have noted there is no line item 
for AIDS medication in IHS's budget and that the President's budget 
does not cover the cost of drugs to treat Indian and Alaska Native 
people infected with HIV. The fact remains, however, that for these 
individuals, IHS is the only source for their medical care. Despite 
recent improvements in the treatment of HIV/AIDS, such as the 
development of more effective drugs, far too many of our people are 
being denied this type of care because IHS is not being funded to 
provide it. NIEA supports the National Congress of American Indians' 
(NCAI) recommendation that a restricted line item be included in IHS's 
budget to cover the cost of AIDS-related treatment.
    Furthermore, while NIEA supports the fiscal year 1998 request of 
$3.8 million for HIV/AIDS Prevention, which is only a slight increase 
from fiscal year 1997, we cannot impress strongly enough upon the 
Committee the need for additional funding to combat this dreaded 
disease. NIEA recommends a significant increase in actual funding to 
all HIV/AIDS education and prevention programs within IHS, and urges 
the Committee to impress upon HHS to implement the final 
recommendations of the President's Advisory Council on AIDS Services 
Committee regarding Native American AIDS Care Issues.
          c. proposed national school construction initiative
    President Clinton has proposed a $5 billion school construction 
initiative which would provide funds over the next four years for 
nationwide school construction and renovation. The proposed $5 billion 
would help pay for up to half the interest that local school districts 
incur on school construction bonds, or for other forms of assistance 
that will spur new state and local infrastructure investment. Interior 
Secretary Bruce Babbitt has asked the Office of Management and Budget 
to include a 10 percent set-aside for BIA-funded schools rather than 
the 2 percent which is being considered by the legislation's sponsors.
    The proposed 10 percent set-aside would allow the BIA to address 
its backlog of school repair projects, including school replacements. 
The estimated backlog of BIA schools needing repair and renovation is 
$675 million. NIEA wholeheartedly supports the Secretary's request for 
a 10 percent set-aside for BIA-funded schools if the President's school 
construction initiative is enacted.
    In conclusion, we want to thank the Subcommittee for continuing to 
give its attention to the issues and concerns we have raised in our 
testimony. In light of the federal government's trust responsibility 
for the education all American Indians and Alaska Natives, and on 
behalf of our members, we urge the Subcommittee's support for 
maintaining or increasing the funding for the Indian education and 
related programs discussed herein at the levels we have recommended.
                                 ______
                                 

Prepared Statement of James E. Billie, Chairman, the Seminole Tribe of 
                                Florida

    The Seminole Tribe of Florida is pleased to submit this statement 
regarding the Tribe's fiscal year 1998 request for $1.21 million from 
programs in the Department of Interior. The Tribe asks: that Congress 
provide $840,000 from the National Park Service, Everglades research 
budget for the Seminole Tribe for activities related to the Everglades 
Restoration Initiative on the Big Cypress Reservation; that Congress 
provide $199,500 from the Bureau of Indian Affairs for water quality 
studies, as a part of the Tribe's Everglades restoration efforts for; 
and that Congress provide an additional $173,000 from the Bureau of 
Indian Affairs for the design and construction of the best management 
practices on the Big Cypress Reservation.
    The Tribe's Everglades Restoration Initiative is a $63 million 
project to construct a comprehensive water conservation system. This 
project is designed to improve the water quality and natural 
hydropatterns in the Big Cypress Basin. This project will contribute to 
the overall success of both the federal and the state governments' 
multi-agency effort to preserve and restore the delicate ecosystem of 
the Florida Everglades. In recognition of this contribution, the 
Seminole Tribe's Restoration Initiative has been endorsed by the South 
Florida Ecosystem Restoration Task Force (see attachment) and has been 
found to be consistent with the recommendations of the Governor's 
Commission for a Sustainable South Florida.
                     the seminole tribe of florida
    The Seminole Tribe lives in the Florida Everglades. The Big Cypress 
Reservation is located in the western basins, directly north of the Big 
Cypress National Preserve. The Everglades provide many Seminole Tribal 
members with their livelihood. Our traditional Seminole cultural, 
religious, and recreational activities, as well as commercial 
endeavors, are dependent on an healthy Everglades ecosystem. In fact, 
the Tribe's identity is so closely linked to the land that Tribal 
members believe that if the land dies, so will the Tribe.
    During the Seminole Wars of the 19th Century, our Tribe found 
protection in the hostile Everglades. But for this harsh environment 
filled with sawgrass and alligators, the Seminole Tribe of Florida 
would not exist today. Once in the Everglades, we learned how to use 
the natural system for support without harm to the environment that 
sustained us. For example, our native dwelling, the chickee, is made of 
cypress logs and palmetto fronds and protects its inhabitants from the 
sun and rain, while allowing maximum circulation for cooling. When a 
chickee has outlived its useful life, the cypress and palmetto return 
to nourish the soil.
    In response to social challenges within the Tribe, we looked to our 
Tribal elders for guidance. Our elders taught us to look to the land, 
for when the land was ill, the Tribe would soon be ill as well. When we 
looked at the land, we saw the Everglades in decline and recognized 
that we had to mitigate the impacts of man on this natural system. At 
the same time, we acknowledged that this land must sustain our people, 
and thereby our culture. The clear message we heard from our elders and 
the land was that we must design a way of life to preserve the land and 
the Tribe. Tribal members must be able to work and sustain themselves. 
We need to protect the land and the animals, but we must also protect 
our Tribal farmers and ranchers. Recognizing the needs of our land and 
our people, the Tribe, along with our consultants, designed a plan to 
mitigate the harm to the land and water systems within the Reservation 
while ensuring a sustainable future for the Seminole Tribe of Florida. 
The restoration plan will allow Tribal members to continue their 
farming and ranching activities while improving water quality and 
restoring natural hydroperiod to large portions of the native lands on 
the Reservation and ultimately, positively effecting the Big Cypress 
National Preserve and Everglades National Park.
    The Seminole Tribe's project addresses the environmental 
degradation wrought by decades of federal flood control construction 
and polluted urban and agricultural runoff. The interrupted sheet flow 
and hydroperiod have stressed native species and encouraged the spread 
of exotic species. Nutrient-laden runoff has supported the rapid spread 
of cattails, which choke out the periphyton algae mat and sawgrass 
necessary for the success of the wet/dry cycle that supports the 
wildlife of the Everglades.
    The Seminole Everglades Restoration project was designed to allow 
the Tribe to sustain ourselves while reducing impacts on the 
Everglades. The Seminole Tribe is committed to improving the water 
quality and flows on the Big Cypress Reservation. We have already 
committed significant resources to the design of this project and to 
our water quality data collection and monitoring system. We are willing 
to continue our efforts and to commit more resources, for our cultural 
survival is at stake.
    In addition to addressing the ecosystem concerns related to the Big 
Cypress Reservation, the Tribe has been actively involved in the 
development of the ecosystem-wide restoration plan. The Tribe, as an 
active member of both the Governor's Commission for a Sustainable South 
Florida and the South Florida Ecosystem Restoration Task Force and 
Working Group, has worked cooperatively with our neighbors to design a 
sustainable future for all of South Florida.
            seminole tribe everglades restoration initiative
    The Department of Interior, through the BIA, has provided the Tribe 
with about $200,000 in each of the fiscal years 1994 through 1997. In 
addition, through the NPS, Interior provided the Tribe with $390,000 in 
fiscal year 1997. The Tribe has used these funds to monitor and analyze 
the quality and quantity of water coming onto and leaving the 
Reservation. The Tribe has also developed a conceptual plan that will 
enable us to meet new water quality standards essential to the cleanup 
of our part of the Everglades ecosystem and to plan for the storage and 
conveyance of our water rights. The appropriated funds have also been 
used to design the Tribe's best management practices program, with the 
assistance of the Department of Agriculture's Natural Resources 
Conservation Service. We continue to use available funds to further the 
design and planning work necessary to implement our Everglades 
Restoration Initiative.
    The Tribe's Everglades Restoration Initiative is designed to 
mitigate the degradation the Everglades has suffered through decades of 
flood control projects and urban and agricultural use and ultimately to 
restore the nation's largest wetlands to a healthy state. Our 
Everglades Restoration Initiative will enable the Tribe: to collect and 
monitor data to establish a baseline and to evaluate performance of the 
overall system design; to design and construct surface water management 
systems to remove phosphorus, convey and store irrigation water, 
improve flood control, and rehydrate the Big Cypress National Preserve; 
to commit to the long-term operation and maintenance of new water 
management systems; and to design and implement comprehensive best 
management practices for the Big Cypress Reservation.
    The Initiative will cost approximately $63,427,496. This project 
will enable the Tribe to meet the numeric target for phosphorus 
concentration that is being used for design purposes by state and 
federal authorities. It will also provide an important public benefit: 
a new system to convey excess water from the western basins to the Big 
Cypress National Preserve, where water is vitally needed for 
rehydration and restoration of lands within the Preserve.
    In addition, a portion of the Tribe's project is being considered 
as a ``critical project,'' under Section 528(b)(3) of the Water 
Resources Development Act of 1996. This authority allows the Corps of 
Engineers (COE) to begin construction of a number of Everglades 
restoration projects on a fast track. On the basis of consensus 
agreements reached at a series of meetings, the Tribe's critical 
project is expected to be funded. The planning and design funding 
requested in this testimony is crucial because the funds will allow the 
Tribe to continue to move the critical project portion of the 
Initiative along in order to meet the Congressional deadline.
                               conclusion
    Improving the water quality of the basins feeding into the Big 
Cypress National Preserve and the Everglades National Park is vital to 
restoring the Everglades for future generations. By granting this 
appropriation request, the federal government will be taking a 
substantive step towards improving the quality of the surface water 
that flows over the Big Cypress Reservation and on into the delicate 
Everglades ecosystem. Such responsible action with regard to the Big 
Cypress Reservation, which is federal land held in trust for the Tribe, 
will send a clear message that the federal government committed to 
Everglades restoration.
    The Seminole Tribe is ready, willing, and able to begin work 
immediately. Doing so will require substantial commitments from the 
Tribe, including the dedication of over 9,000 acres of land for water 
management improvements. However, if the Tribe is to move forward with 
its contribution to the restoration of the South Florida ecosystem, a 
substantially higher level of federal financial assistance will be 
needed as well.
    The Tribe has demonstrated its economic commitment to the 
Everglades Restoration effort; the Tribe is asking the federal 
government to participate in that effort,also. This benefits not just 
The Seminole Tribe, but all Floridians who depend on a reliable supply 
of clean, fresh water flowing out of the Everglades, and all Americans 
whose lives are enriched by this unique national treasure.
    In closing, I must also urge you to give careful consideration to 
increasing the funding set-aside for Tribal Priority Allocation (TPA) 
accounts. The BIA budget has already absorbed a disproportionate share 
of the cuts which Congress has made to discretionary funding. TPAs, of 
all categories within BIA accounts, most directly boost tribal 
economies by providing direct funding to tribal priority 
infrastructure, health, and education needs. With growing populations 
and annual inflation, even ``holding the line'' on TPA's amounts to a 
reduction in funding. Although the federal government is working 
through tight budget times, I urge you not to try to balance the 
federal deficit on the backs of the Tribes. The federal government has 
a trust responsibility to the Tribes. Severe cuts to the BIA budget, 
and to TPA's specifically, violate that trust responsibility. All 
Tribes, including the Seminole Tribe of Florida, are struggling with 
increasing needs and decreasing funding. For the sake of our children 
and the survival of Tribal culture, I urge you to fund fully the TPA's.
    I appreciate the opportunity to present my views to this 
Subcommittee and would be happy to provide additional information upon 
request.
                                 ______
                                 

         Prepared Statement of the Colorado River Indian Tribes

    The Colorado River Indian Tribes is pleased to have the opportunity 
to submit the foregoing statement to the Senate Appropriations 
Subcommittee on Interior and Related Agencies regarding the fiscal year 
1998 appropriations that are necessary to effectively operate our 
tribal government programs.
                        bureau of indian affairs
    The proposed BIA budget of $1.73 billion would restore $126.1 
million to the BIA for fiscal year 1998. This $126.1 million increase 
in less than half the amount that was lost in fiscal year 1996. None of 
the funding lost in fiscal year 1996 has been restored.
    The BIA budget request for fiscal year 1998 emphasizes funding for 
Tribal Priority Allocations (TPA) programs, which include tribal Self-
Determination contracts and Self-Governance compacts. The requested 
increase is necessary to keep pace with the transfer of additional 
Indian programs into TPA by the BIA. Tribal Priority Allocations funds 
will support this transfer of programs and funding from the BIA to 
tribal governments will allow more local control of programs with less 
federal bureaurocracy. Although this increase is, it is hardly adequate 
to meet the needs of the programs that serve Native American people.
                         indian health services
IHS
    The proposed IHS budget of $2.4 billion requests an increase of $68 
million over the fiscal year 1997 appropriated level. However, the 
funding is not adequate to keep pace with medical inflation costs, 
population growth and newly-recognized tribes, and would not reduce the 
backlog of unmet health care needs. The Colorado River Indian Tribes 
are particularly concerned about the lack of increases for Contract 
Health Services for the past two years.
Construction of Parker Out-patient Facility
    The Colorado River Indian Tribes (Tribes) believe that the long 
overdue replacement of the Parker Out-patient Facility should be a top 
priority with IHS. Total funding of $20,291,320 is needed to complete 
the design and construction of the Parker Health (Ambulatory) Center. 
This included $661,020 to complete the design phase of the project and 
$19,630,300 for the construction phase and medical equipment. After 
many years of delay in the planning process to begin replacement of the 
health care facility, the Tribes assumed responsibility of the project 
and a contract for the design and construction of the facility was 
awarded. Since then, Architectural/Engineering services for the design 
is near completion and construction is expected to begin in the spring 
of 1998, provided that funding is appropriated in the fiscal year 1998 
budget.
    Funding for construction of this project is needed in order to 
bring this project to completion. The current facility is old, 
originally constructed in 1930 with additions made in the 1950's, and 
functionally obsolete and cannot serve the medical needs of the 
population. In the past the Tribes have received Congressional support 
for the construction of the facility. Funding for the construction and 
staffing of the new facility has been rated top priority for the last 
ten years and construction has yet to be initiated.
                     specific appropriation request
Colorado River Indian Irrigation System
    In 1993, $1.9 million was allocated for the Colorado River Indian 
Irrigation Project. Although rehabilitation work on the Colorado River 
Indian Tribes Irrigation Project has made much progress, much work is 
still needed to complete the rehabilitation work. Funding in the amount 
of $3,450,000 is requested for the following components of the project:
    1. Replacement of existing large gate check structures (8) which 
are old hand-operated wooden gates that severely reduce the amount of 
water delivered to the farms and cause numerous breaks in the canal 
banks. These failing structures need to be replaced with numerous 
breaks in the canal banks. These failing structures need to be replaced 
with modern radial gate control structures with automated level 
controls at an estimated cost of $1,600,000.
    2. Replacement of six existing large radial gate structures, which 
are extremely corroded and cannot he effectively operated dale to old 
controls. These gates are failing and should be rehabilitated. 
Structural rebuilding, and installation of modern electric controls and 
automation will allow them to effectively control the large amount of 
water flowing through them. They currently serve over 40,000 acres. The 
cost is estimated at $600,000.
    3. Replacement of existing wooden wasteway structure which 
maintains the water level in one of the largest laterals in the CRIT 
Irrigation System which leaks (wastes) a very large amount of water to 
a drain emptying to the Colorado River. This structure needs to be 
replaced with a modern concrete and metal sluice gate with electric 
controls and automatic level sensors to prevent flooding damage to the 
neighboring cropped fields at an estimated cost of $300,000.
    4. Lateral 73-36, which serves a substantial portion of the 
southeastern quarter of the Reservation, has inadequate irrigation 
water carrying capacity to meet the needs of the crop lands in that 
area. If the Tribes are to use that land, it must be enlarged to 
increase the culvert and gate structures and related field turnouts at 
an estimated cost of $300,000.
    5. There are currently no farm water delivery measurement devices 
for the 80,000 acres of irrigated crop land on the Reservation. The 
Tribes must have the means to carefully control and distribute their 
water and regulate the farm lessees to keep water use at its most 
efficient. In addition, the Tribes cannot make full use of their 
irrigable land without these measurement devices and good efficient 
water control. Estimated cost of $400,000.
    6. All improvements to the irrigation system will require 
professional engineering design and supervision when constructed. 
Estimated cost for such engineering design consultant services is 
$250,000.
                               conclusion
    The Colorado River Indian Tribes ask for your support in protecting 
the funding for BIA and IHS in fiscal year 1998. In 1995, the Senate 
Budget Committee included the following language in its 1996 Concurrent 
Resolution on the Budget, calling for protection of the BIA and IHS 
funding at the 1995 levels for the next seven years:
    ``The [Senate Budget] Committee recognizes the unique trust 
relationship between the U.S. Government and the nation's Indian tribes 
and pueblos. That trust relationship is based on a government-to-
government principle embodied in treaties and subsequent actions by 
both the Executive and Legislative Branches of Government, and the 
courts. The Committee acknowledges this trust relationship, and assumes 
that programs serving Native Americans through the Bureau of Indian 
Affairs will be given consideration for ongoing federal support.'' 
(Senate Report 104-82)
    To uphold this Congressional commitment, the Colorado River Indian 
Tribes request this language to be included in the 1998 Concurrent 
Resolution on the Budget.
    The Colorado River Indian Tribes thank you for the opportunity to 
bring these matters to your attention. Please feel free to contact the 
Tribes If you have any additional questions.
                                 ______
                                 

 Prepared Statement of Bruce Wynne, Chairman, Spokane Tribe of Indians

    Thank you for the opportunity to submit this testimony on behalf of 
the Spokane Tribe. The Tribe is located in Eastern Washington, has 
2,145 members and a Reservation of 156,000 acres. While the Spokane 
Tribe was historically a fishing tribe, we now rely primarily on timber 
for tribal income. There are three program areas within the Bureau of 
Indian Affairs for which the Tribe is asking for increased funding over 
the Administration's fiscal year 1998 request: Tribal Priority 
Allocation ($195,900); Upper Columbia United Tribes ($400,000); and 
Lake Roosevelt Management ($100,000). We also support the President's 
proposed increase of $3 million for funding for the Tribally Controlled 
Community Colleges. In the Indian Health Service, the Tribe is asking 
the Subcommittee to support funding for new modular units to house the 
Tribe's clinic programs (approximately $500,000); funding for an 
elderly assisted living program ($200,000); and funding for operational 
costs of the Healing Lodge of the Seven Nations youth treatment 
facility ($2.1 million). In addition, there are two policy matters the 
Tribe wishes to bring to the Subcommittee's attention: the first is the 
proposal to remove the trust responsibility office from the BIA which 
we oppose at this time and the second is the need to include tribes in 
the decisions related to restructuring of the Pacific Northwest Energy 
System.
                        bureau of indian affairs
Tribal Priority Allocation (TPA) Account
    The BIA budget request shows a modest increase in TPA funding. As 
you know, TPA represents nearly 50 percent of the total budget for the 
BIA but it is the lifeblood of tribal governments. It is the money 
tribes receive to support services for their people. We do not have a 
tax base; the United States owns legal title to all our lands and they 
are not taxable. The United States obligation to provide funds for 
tribal health, education and welfare programs is part of the treaty 
guarantees made to tribes by the United States in return for the 
cession of millions and millions of acres of land.
    Because of the decreases in fiscal year 1996 and fiscal year 1997 
funding for the TPA account, the proposed increase will leave tribes 
barely even with the fiscal year 1995 actual dollar level but actually 
losing in terms of adjustments for inflation. At Spokane, our TPA 
funding in fiscal year 1997 was $593,200; the anticipated funding in 
fiscal year 1998 would be $635,700, an increase of $42,500. Mr. 
Chairman, we use these funds for many purposes, including tribal 
government infrastructure, services for children and the elderly, 
scholarships, education, courts, law enforcement, adult vocational 
training, agriculture and forestry. As you can see, the funds must be 
stretched very thin for all programs. The services the Tribe is 
expected to deliver versus the amount of our contracts for these 
programs does not fulfill the BIA's trust responsibility. For example, 
our contract for natural resources is $2,800, obviously not enough to 
fund even a support staff person; community fire protection is funded 
at $4,100; public safety at $12,700. Our additional identified needs 
total $195,900 as shown below: $40,000 for scholarships; $40,000 for 
fire protection; the Tribe currently loses 98 percent of all structure 
fires because of bad equipment, inadequate communications, and remote 
fire stations; $115,900 for tribal courts. The Tribe's court caseload 
has increased fourfold in two years.
    We ask the Subcommittee to support the President's proposed 
increase for TPA and to add more if possible to this account which 
targets spending at the local level. An across-the-board ten percent 
increase over the President's budget would be of great benefit to all 
tribes nationwide.
Tribally Controlled Community Colleges Act
    The President's budget requests an increase of $3 million for the 
TCCC's. We believe this minimum amount is necessary to maintain stable 
and productive colleges on Indian reservations. The Spokane Tribal 
College is in its early stages of development as a sister college of 
the Salish-Kootenai College at the Flathead Reservation in Montana. We 
are proud of our accomplishments to date and look forward to full 
participation in the TCCC's program in the near future.
Upper Columbia United Tribes (UCUT)
    The primary purposes of the UCUT program is to mitigate the harm to 
fish and wildlife caused by the construction and operation of 
hydroelectric facilities on the Columbia River and its tributaries. The 
tribal portion of this program has helped the Northwest Power Planning 
Council to understand the fundamental importance of fish and wildlife 
resources to the religious, cultural and economic livelihood of the 
Indian Tribes. UCUT funds are used to implement, monitor and evaluate 
fish and wildlife plans, as well as for regulatory enforcement, for 
planning, and for coordination between state, federal and tribal 
governments.
    The President's budget request of $297,000 includes a return of 
$74,000 that had been transferred in fiscal year 1997 to the Kootenai 
Tribe under its self-governance program. Because UCUT involves 
management of a shared resource by four tribes in the Northwest, it is 
also a shared responsibility and thus is not a program that is amenable 
to separation of funding. We believe the proposed transfer is correct 
and hope that the Subcommittee will concur.
    We have recently completed an assessment of total funding needs for 
this program and found it to be just over $700,000. The four UCUT 
tribes would be most grateful if the Subcommittee would recommend an 
increase of $400,000 to $700,000 for fiscal year 1998. This increase is 
needed for the tribes to continue to leverage funding from other 
sources such as BPA and EPA; to implement new fish and wildlife 
projects approved by NPPC in 1995; and to maintain and improve existing 
projects approved in 1987, 1994, and 1995. In addition, funds are 
needed to assist tribes in developing recommendations for a NPPC 
amendment process being initiated this year.
Lake Roosevelt
    Lake Roosevelt was formed when the Grand Coulee Dam was constructed 
in the early 1940's. Both the Spokane and Colville Tribes participate 
in the management of the environment and the recreational uses of the 
area surrounding the Lake. The Tribes implement the cooperative 
management agreement entered into between the Tribes and the Department 
of the Interior for management of this resource. The BIA has asked for 
an increase from $577,000 in fiscal year 1997 to $590,000 in fiscal 
year 1998. The Tribe supports the proposed increase. For the 
Subcommittee's information, the Spokane Tribe's contract amount is 
$185,000; the actual, documented need is $285,000. Right now, the 
contract supports salaries and vehicle costs for three rangers; it does 
not fund the parks maintenance staff, vehicles or supplies. The Tribe 
must pay these costs from its own revenues. Therefore, the Spokane 
Tribe requests an additional $100,000 earmarked for the Tribe's 
management contract for Lake Roosevelt.
    The Tribe also supports the testimony of the Northwest Intertribal 
Court System requesting funding for the Indian Tribal Justice Act and 
for the NICS program through the BIA.
                         indian health service
    As a general comment, the Spokane Tribe is concerned about the 
inadequate funding base for the Indian Health Service, particularly the 
lack of funds for Alcohol and Substance Abuse, and the inadequate base 
for Mental Health Services. We note that the fiscal year 1998 budget 
request does not include increases for inflation and to meet the cost 
of implementing managed care throughout the IHS system. The Tribe is 
also concerned about the ongoing need for additional resources for 
construction funds, since many of the clinics in the Northwest are 
outdated, and unable to meet standards for quality health care.
    An IHS service unit clinic at Spokane serves all of the Indians 
residing on and near the Spokane Reservation. The clinic is small and 
is housed in a substandard facility. It is understaffed, with not 
enough doctors, dentists and other needed health personnel. We 
understand that Representative Nethercutt, who is the Tribe's 
representative in the Congress, is working with the IHS to obtain 
modular units to house the clinic. We ask the Subcommittee's support 
for his efforts. The cost will be about $500,000.
    In addition, Mr. Chairman, we would like to begin an assisted 
living program for our elderly citizens through the CHR program at IHS. 
The Tribe would need a minimum of $200,000 to establish such a program.
    Our third request under IHS is for $2.1 million in fiscal year 1998 
for operational costs of the Healing Lodge of the Seven Nations. The 
Healing Lodge is a residential program that utilizes a holistic and 
traditional American Indian approach as well as the 12-step principles 
of recovery for the treatment of chemically dependent youth. The 
Healing Lodge is governed by seven tribes in Washington, Idaho and 
Oregon. In addition to the Spokane Tribe, the Colville, Kalispel, Nez 
Perce, Kootenai, Coeur d'Alene and Umatilla Tribes participate. Last 
summer, the facility moved to a new site in the Spokane Valley. Within 
a 32-youth and 12-family bed facility on a forested 38-acre site, the 
treatment team responds to the needs of Native youth by offering such 
treatment services as group and individual therapy; culturally-relevant 
therapy; life skills instruction; chemical dependency lectures; family 
therapy; aftercare and transitional planning; and health and mental 
health, nutrition and fitness assessments. At the end of February, the 
Healing Lodge completed its first cycle under a new, eight-week 
treatment program, having provided services to 151 youth aged 13 to 18. 
Of that total number, 62 completed treatment and were transitioned to 
aftercare programs.
    Finally, the Spokane Tribe also supports the testimony of the 
Northwest Portland Area Indian Health Board in its entirety. We are 
particularly supportive of the proposed bill language that would allow 
use of maintenance and repair funds to be used for new construction 
when the costs of repair exceeds the costs of new construction. The 
Tribe also supports the request for $200 million to cover unfunded 
mandatory costs increases.
                             policy matters
    The Tribe is very concerned about the proposed plan to implement 
reforms required by the American Indian Trust Fund Management Reform 
Act of 1994. In particular, the Tribe has determined that further study 
must be undertaken of the proposal to create an independent 
organization, outside the Department of the Interior, that would assume 
all trust asset management functions. Because of our concerns, we 
strongly urge that the Subcommittee not take any action to implement 
any part of the proposal until the Tribes have reached some agreement 
on the matter.
    In addition, the Tribe is involved in an effort to develop a truly 
comprehensive restructuring plan for the Pacific Northwest Energy 
System. A steering committee, appointed by the governors of Washington, 
Oregon, Idaho, and Montana, developed recommendations for energy system 
restructuring that was driven largely by utility and industrial 
interests; it did not involve the affected Tribes. These same governors 
recently appointed a Transition Board to expedite implementation of the 
Steering Committee's recommendations but, again, the Transition Board 
does not include any tribal representatives nor have they attempted to 
involve the Tribes in their deliberations. The Tribes are concerned 
that the recommendations now under review do not address impacts on 
fish and wildlife and cultural resources, nor do they assure 
continuation of conservation programs or support for renewable energy 
efforts. We wanted the Subcommittee to be aware of our concerns in this 
area. Tribal efforts to organize to respond to these threats to federal 
law and treaty obligations are costly. We do not now ask for 
appropriations for this purpose but wanted you to know our concerns and 
the kinds of issues Tribes face almost constantly and to which they 
have little or no resources to respond.
    The Tribe appreciates the opportunity to submit this testimony, and 
we look forward to working with the Subcommittee during the fiscal year 
1998 appropriations cycle.
                                 ______
                                 

   Prepared Statement of Dr. Edward Slocum, Superintendent, New Town 
                      Public School District No. 1

    My name is Edward Slocum. I am superintendent of the largest school 
district on the Fort Berthold Indian Reservation in western North 
Dakota. Our school district provides an education for 47 percent of the 
Native American children on Fort Berthold. Over 80 percent of the K-12 
enrollment of the New Town Public School District No. 1 are Native 
American students. Ironically, our district is one of only two 
districts on this reservation which are not able to receive funding as 
a BIA ISEP Grant School through the U.S. Department of the Interior. 
This written testimony will focus on why it is so important for 
Congress to provide the funding necessary for ISEP to allow the current 
moratorium on new school starts to be lifted.
    You may wonder why, if this district wanted to be a BIA funded 
school, did we wait so long to decide to apply? Historically, New Town 
was not believed to be located on the reservation when the U.S. Army 
Corps of Engineers created the city of New Town by relocating three 
smaller towns, which were flooded when the federal government built the 
Garrison Dam. Then, in 1974, the U.S. Supreme Court ruled that a large 
piece of land, including the city of New Town, was indeed located on 
the Fort Berthold Indian Reservation. The delayed effects of these two 
major federal decisions were eventually reflected when the K-12 student 
enrollment reached over 50 percent Indian students in the New Town 
Public School District in 1986. Since then, that percentage has been 
climbing every year and the student enrollment has been increasing 
steadily.
    On February 23, 1995, the New Town Public School District's Board 
of Education met with the Tribal Council of the Three Affiliated Tribes 
and obtained a resolution authorizing the New Town School Board to 
apply for BIA grant funding for school operations, as provided for in 
Public Law 100-297, Title V, Parts A & B. By that time, K-12 student 
enrollment was nearing 50 percent Indian students, and three of the 
five School Board Members were Native Americans. The district has been 
applying every year since then only to be denied due to the moratorium 
on new school starts.
    The most recent State data, School Finance Facts. January 1997, 
showed New Town Public School District's average cost per pupil as 
$4,076.09, while Mandaree School District, a Bureau funded ISEP school 
also located on the Fort Berthold Reservation, has been able to spend 
$10,967.45 per pupil. The New Town Public School District has been 
averaging nearly 70 percent of its students on Free and Reduced meals 
over the past several years due to the high unemployment rate on the 
reservation. The strong correlation between the economically 
disadvantaged and academically disadvantaged is abundantly evident in 
our district. Nearly 50 percent of our elementary aged students qualify 
for Title I assistance as educationally disadvantaged. The New Town 
Public Schools can not afford any Gifted and Talented Programs. The 
district has just finished replacing all buses originally purchased 
during the 1970's and many textbooks are far older than the recommended 
five year replacement age. The district's tax base only yields $337,000 
per year towards our 3.9 million dollar General Fund. Impact Aid is 
never fully funded and so those revenues do not adequately compensate 
for the lands taken off the tax rolls.
    Of our 589 Indian students, 125 do not generate Impact Aid dollars 
because they do not live on qualifying Indian Trust Lands. It has been 
calculated that our district would be eligible for an increase in 
funding of approximately $3.5 million if approved as a BIA funded ISEP 
grant school. These funds are badly needed to provide for the 
educational needs of the students of the district.
    In summary, it is our hope that adequate funding levels will be 
provided by Congress to enable districts such as ours to be allowed to 
become a BIA funded school. It is unimaginable that the Three 
Affiliated Tribes of Fort Berthold Reservation can have half of their 
enrolled member students ineligible for the quality of education 
intended for Native American children in the passage of Public Law 100-
297.
                                 ______
                                 

Prepared Statement of Mervin Wright, Jr., Chairman, Pyramid Lake Paiute 
                                 Tribe

    Good morning, Chairman Gorton, Members of the Committee and 
Honorable Tribal leaders. My name is Mervin Wright, Jr. and I am the 
Tribal Chairman for the Pyramid Lake Paiute Tribe of Nevada. On behalf 
of the Pyramid Lake Paiute Tribe, I appreciate the opportunity to 
testify before the Senate Sub-Committee on Interior Appropriations. We 
express our gratitude for Committee support in the past, and 
respectfully request the Committee to fund the Tribe's priorities for 
fiscal year 1998: High School Construction, Education, Water Rights 
Settlement, Resource Management, Indian Health Services, Environmental 
cleanup, Law Enforcement, and Cultural Preservation. A brief history 
will support this request for funding.
                             tribal history
    The Pyramid Lake Paiute Tribe is one of many Paiute band of the 
Northern Paiute Nation and was affirmed by the Indian Reorganization 
Act of 1934. The Pyramid Lake Indian Reservation is the largest Indian 
reservation in the State of Nevada covering approximately 476,000 
acres. The reservation contains entirely within its boundaries, a 
natural desert lake from which the Tribal name was derived. It is the 
largest terminal lake in the United States and has a surface area of 
110,000 acres and is deep as 330 feet. A prehistoric indigenous fish 
species called the Cui-ui (pronounced Kwee-wee) has existed in Pyramid 
Lake for thousands of years and is the foundation of our Paiute 
culture. The Cui-ui is currently listed as an endangered species, while 
another inhabitant fish species the Lahontan Cutthroat Trout is listed 
as threatened species. The Lahontan Cutthroat Trout is an important 
aspect of our livelihood, as is the Cui-ui and was once the primary 
economic support for our Paiute People.
    The enrolled membership of the Tribe is approximately 1,800 people. 
As a Tribal Government, the Tribal Council responsibility is to provide 
primary services to our elderly, our children, and the support for 
social order within our reservation. Cultural identity is becoming a 
prevalent matter of importance in preserving the well being of our 
people. Education is a primary focus for the betterment of our People. 
Health care is an area that requires professional care at an affordable 
price. Social Services will enhance the well being of our People in 
addressing social ills of our modern day society. These are issues 
which have additional pressures that we are managing and require 
financial resource support for eventual success.
Pyramid Lake High School: $10,000,000
    The planning and architectural design phase of our high school is 
100 percent complete. As one of many Tribes who have placed education 
as an important asset of our People, unfreezing of the Tribal high 
school construction list will be a major step to assist in preparing 
our children for future endeavors in career and professional 
advancement. A high drop out rate and low self esteem among our high 
school students causes parents and administrative staffs to react, 
sometimes negatively, to address the problems of drop out rates. The 
physical conditions of school modular facilities are often equivalent 
to trailer parks; children who attend such facilities often have 
increased feelings of low self-esteem. A new high school will enhance 
the acceptance of an educational standard of achievement that will 
promote post secondary education and the well being of our communities.
    Unfreezing the construction list will provide the means for 
advancement of all Indian Tribes currently on the construction list to 
begin recognizing the effort by each government to achieve an objective 
that promotes consistent objectives in our societies. In promoting and 
supporting a high standard of achievement, and from personal 
experience, each child entering high school must be provided the 
opportunity to realize the challenge of successful completion of an 
educational institution. Tribes have become better prepared and 
educated to deal with social disorders and recognize the goal of 
motivating our children to strive for better conditions for their lives 
than the experiences we hold from our past.
Water rights settlement/water resources management: $6,500,000
    The Pyramid Lake Paiute Tribe has a long history of water 
litigation on the Truckee and Carson Rivers in Northern Nevada. Since 
the inception of the Newlands Reclamation Project in 1902 and the 
accompanying Derby Dam construction in 1908, the degradation of the 
Pyramid Lake aquatic habitat and environmental structure has been 
seriously damaged. Litigation was costly and the Tribe decided to enter 
negotiations in the mid-1980's in an attempt to resolve outstanding 
issues through talks with upstream municipalities, the States of Nevada 
and California and the federal government. A settlement act was 
achieved in 1990 with the Congressional passage and Presidential 
signing of Public Law 101-618, the Truckee-Carson-Pyramid Lake Water 
Settlement Act.
    The Pyramid Lake Paiute Tribe is in the process of settling two 
outstanding lawsuits which were filed in the early 1980's against the 
Truckee Meadows Water Treatment Plant. The lawsuits have been 
dismissed. However, the water rights purchase program to augment 
instream flows to the Truckee River during July, August, and September 
was agreed to by the parties to resolve concerns about future expansion 
of the wastewater plan. Six million dollars has already been 
appropriated and is in the federal system. The United States Department 
of Interior, on behalf of the Tribe, is obligated to purchase $12 
million worth of water rights from willing water right holders in the 
Truckee River Basin. We are concerned that if the Bureau of Indian 
Affairs gains control of any amount of these tribal funds, the Tribe 
will lose some of the benefit intended for the Tribe. The Tribe is 
quite capable of managing and administering this program.
    We are currently involved with negotiating the final stage of the 
Truckee-Carson-Pyramid Lake Water Settlement Act (Title II of Public 
Law 101-618); however, the management and monitoring enforcement 
measures will not conclude with achievement and approval of this 
settlement. The Pyramid Lake Paiute Tribe is one of five principle 
signatories of the settlement act. As we begin the initial 
implementation phases of the settlement act, it is acknowledged of the 
immense administrative responsibility accompanying implementation of 
this law. The Tribal Water Resources Management Contract will require 
$500,000 in funding support for a highly technical advanced operation 
associated with monitoring flows and water quality criteria, scheduling 
releases, managing released flows, accounting of water supplies and 
participating in further implementation and regional water 
negotiations. The decision to enter negotiations was one to avoid 
litigation expenses, plus to achieve resolution by compromising from 
each side to lessen the ability to create and support adversarial 
positions.
Health Services: $1,000,000
    The social structure on our reservation is one of fragile capacity. 
The problem associated with the lack of adequate services to our People 
is a reflection of funds appropriated for unnecessary purposes. The 
Health Service provided through Indian Health Services is not adequate. 
The services reaching our People are not reflective of the amount of 
funding support in the Area and Headquarter Offices of this agency. The 
Tribe has built its own clinic facility, but the bureaucracy 
surrounding the service absorbs much of the funding before actual 
services can be provided. This amount will support contract health, 
dental, mental health, substance abuse, child abuse, and social based 
services.
Cultural resource preservation: $300,000
    The Pyramid Lake Paiute Tribe is affected by the enactment of 
various federal laws and State statutes associated with the protection 
and preservation of cultural resources. Some issues have the effect of 
compromising and damaging existing resources. The Tribe has the ability 
to represent concerns and issues before federal and state agencies, but 
does not have the financial ability to organize an effort to work 
cooperatively and in conjunction with such agencies. The Tribe will be 
responsible for planning and developing important representation to 
protect and preserve cultural resources. This amount will provide the 
Tribe the ability to work with other Paiute Tribes in an effort to 
utilize necessary resources to protect cultural resources.
Environmental clean-up: $250,000
    Pyramid Lake received substantial impacts associated with the New 
Year's Flood in the Truckee River Basin. Two sewer mains were broken, 
the Sparks industrial area suffered serious flooding which resulted in 
a number of unidentifiable contaminants reaching the Truckee River and 
eventually ending up in Pyramid Lake. Several bird species have been 
taken for toxicology studies to determine the extent of contamination. 
The impact to the micro-organism habitat is not yet known and our fear 
is that the beginning of a food chain so important to the rest of this 
habitat has suffered consequential damage. This fund will support 
activities in an effort to maintain control measures for water quality. 
As we proceed into monitoring requirements under a water quality 
agreement (stated above) and proceeding with implementing tribal water 
quality standards, it is important to establish and implement a 
hazardous material response against environmental degradation.
Law enforcement: $500,000
    Tribal law enforcement requires financial support for effective 
enforcement of tribal laws and regulations. In enforcing the regulatory 
requires for law and order, fish and game and ordinance compliance, 
this funding will support the ability to work cooperatively with 
federal officials, state officials, and local jurisdictions. It is 
important that our tribal government accept and support the needs of 
adequate law enforcement for proper enforcement measures to meet our 
community needs.
Policy Issues
    BIA and IHS Reorganization.--As Congress begins to review the 
reorganization of the federal agency, BIA, there are serious concerns 
with respect to the structure of the BIA which provides actual services 
to reservation communities. When tribes view their resources, certain 
considerations must be acknowledged to the trust obligation of the 
federal government. In recent years the federal agencies have struggled 
for power and authority in Indian affairs. The BIA is not recognized as 
a force within Interior in representing the trust responsibility 
directly to Indian Tribes. The authority vested in the Interior 
Department to uphold the trust responsibility does not exist with the 
proper authority, BIA.
    Now, in reviewing the structure of the BIA, it is the BIA Area 
Offices and the BIA Agencies that tend to regulate the authority of 
this federal agency. The services provided through the Interior 
appropriation process gets into the system, but normally the area and 
agency offices tend to absorb the funds intended for tribal programs. 
In some cases, the federal laws are misinterpreted and BIA officials 
misguide Tribes in complying with statutory requirements. It is a 
matter of reducing the bureaucracy causing setbacks, but not cutting 
funding for services. This Congress should seriously consider strategy 
thinking in recourse management. The focus must view the trust assets 
as priority.
    The IHS is in the same situation. The services are not received at 
adequate levels. It is the Area Office and the Headquarters where the 
bureaucracy absorbs the funding intended to provide services on the 
ground. A comparison in one case, is the commissioned officials making 
six digit salaries, and the Tribe receives $152,000 to serve 1,300 
patients in contract health services. The purpose or reorganizing the 
IHS should be viewed as one to increase the services at the 
reservation. It is recommended that the process of restructuring the 
IHS not result in less services. Deficit spending is occurring in this 
agency, and the Area Offices are not accepting responsibility in 
balancing the deficit. The Tribes who have provided needed services 
through contracting must not be penalized for the efforts we are 
making. Tribal members eligible for Medicaid and Medicare, but the IHS 
system offers their services as a supplement, not as an addition to the 
care provided. Either way the system provides the best method to serve 
our patients.
    School construction.--While the bulk of the responsibility for 
Indian school construction falls now within the BIA, the President has 
asked for $5 billion to fund school construction needs in the United 
States and we are hopeful that the Congress will accept this proposal. 
However, we know that funds for this would be appropriated by the 
Subcommittee on Labor and HHS Appropriations. We understand that 
Interior Secretary Babbitt has suggested that 10 percent of these 
funds, if appropriated, be set aside for school construction. We agree. 
The federal government owns the legal title to our lands and we have no 
tax base. In our view, the first responsibility of the federal 
government to the nations's school construction needs should be on 
Indian lands. Ten percent of $5 billion would take care of much of the 
unmet school construction needs in Indian country.
    Trust responsibility.--The federal trust responsibility is one that 
our People know well and is one that I cannot allow to be overlooked or 
placed secondary to resources of material content. We are People of 
this land, the first People of this land and express our concern for 
equal, if not better, services for our People than has been provided by 
the Congress over the past 20 years.
                                 ______
                                 

Prepared Statement of Joseph C. Saulque, Chairman, Owens Valley Indian 
                            Water Commission

    This appropriations request is for the U.S. Department of the 
Interior, Bureau of Indian Affairs, Water Resources Protection Program. 
The amount of funding being requested for fiscal year 1998 is $258,068. 
This money will be used for capital startup costs for the Owens Valley 
Tribes' comprehensive Groundwater Monitoring Program and negotiation 
support costs.
         background information about organization to be funded
    In 1991, the Paiute people commonly known today as the Owens Valley 
Paiute Indians, but to themselves are known as Nume which means people, 
chartered the Owens Valley Indian Water Commission (Commission) to 
serve as their water department to: negotiate the tribes' water rights 
with the federal government and the Los Angeles Department of Water and 
Power (LADWP); address the impacts of LADWP's water extractions and 
diversions on reservation environments; and improve water-related 
conditions on the reservations.
    The Commission is comprised of two tribal members from each tribe 
for a total of ten Commissioners. Six of the Commissioners also serve 
on their respective tribal councils and the others are appointed by 
tribal resolution.
    The Owens Valley Tribes are part of the greater Northern Paiute 
Nation whose original territories encompassed the greater part of 
western Nevada, parts of Oregon and Idaho and east central California. 
The Owens Valley Tribes include the Big Pine Paiute Tribe of the Owens 
Valley, the Bishop Paiute Tribe, the Fort Independence Paiute Tribe, 
the Lone Pine Paiute-Shoshone Tribe, all located in Inyo County, CA, 
and the Utu Utu Gwaitu Paiute Tribe located in Mono County, CA. 
California's Owens Valley stretches for 100 miles along the eastern 
flank of the Sierra Nevada range. At present, the tribes occupy only a 
small fraction of their ancestral lands. The majority of these lands 
are now owned by the City of Los Angeles Department of Water and Power 
for water gathering activities or are administered by the Inyo National 
Forest Service and the Bureau of Land Management. The Owens Valley 
supplies 70 percent of Los Angeles' domestic water supply.
                   exportation of owens valley water
    At the turn of the century, the City of Los Angeles (City) began 
acquiring land and water rights in the Owens Valley which at present 
total 300,000 acres in Inyo and Mono Counties, comprising 97 percent of 
the privately held land. In 1913, the City completed a surface aqueduct 
(the first) between the Owens Valley and Los Angeles and began 
exporting Owens Valley water.
    In 1941, the City completed the Mono Basin Project which gathered 
the natural run-off from the Mono Basin and delivered water to Los 
Angeles through the first aqueduct. Since 1917, the City has drilled 
more than 360 wells in the Owens Valley to access groundwater to be 
used as a supplementary source of water during dry years.
    In 1959, the City proposed the construction of a second aqueduct to 
carry water from Owens Valley to Los Angeles for the purpose of 
completing the development of the Inyo-Mono supply and to ensure the 
City would not lose certain water rights on which it had filed. At the 
time the City finished constructing the aqueduct in 1969, it had not 
yet started increasing its exportation of groundwater when the 
California Environmental Quality Act (CEQA) became law in 1970. Because 
the groundwater extraction was viewed as a separate project dividable 
from the construction of the second aqueduct, the Court of Appeal 
required the City to prepare an Environmental Impact Report (EIR) under 
the CEQA. The City has prepared two EIR's (1976, 1981) and both of 
these have been declared legally inadequate by the Third District Court 
of Appeal for the State of California.
    In 1984, the Court granted permission to the City and the County of 
Inyo (County) to enter into an interim long-term groundwater management 
agreement and attempt to negotiate a resolution of the pending 
lawsuits. The final EIR submitted to the Court on October 21, 1992, 
contains the final agreement of the parties which describes a long-term 
groundwater management plan. Neither the Tribes nor the United States 
are parties to this agreement.
    While the County has found the City's final EIR to be adequate, the 
Third District Court of Appeal has retained jurisdiction of the 
lawsuit. The State of California's Department of Fish and Game, as well 
as other environmental groups and concerned individuals, have 
challenged the adequacy of the City's EIR. It now appears that a 
settlement has been reached by the parties and that this settlement was 
presented to the Court of Appeal on January 24, 1997. The Commission 
had no input concerning this proposed settlement.
    In 1990, the Big Pine Tribe (who at that time was the lead tribe of 
the Commission) prepared comments concerning the City's proposed EIR. 
After the filing of these comments, the Commission requested and 
received amicus curiaestatus with the Third District Court of Appeal.
    During this same time, the Commission began negotiations with the 
Los Angeles Department of Water and Power (LADWP) concerning its 
environmental concerns, as well as the issues of reserved water rights 
for lands traded to the City in a 1939 land exchange with the United 
States. In this exchange, the United States has traded 3,126 acres of 
land throughout the Owens Valley for 1,391.5 acres of land which are 
now the reservations of the Bishop, Big Pine, and Lone Pine Tribes. In 
this agreement, the water rights were reserved on the traded lands, 
with the City agreeing to provide, in perpetuity, four (4) acre feet of 
water per acre per year annum to the present reservation lands. The 
United States reserved the water rights to the 3,126 acres traded to 
the City and the City retained the water rights to the present 
reservation lands.
    The Commission believes the present FEIR and long-term groundwater 
management agreement fails to recognize the off-reservation water 
rights of the Tribes, and fails to protect these rights, as well as the 
vegetation and general environment on the present reservations. The 
negotiations with the LADWP center around these issues.
      commission groundwater monitoring and negotiation activities
    In recognizing its trust responsibilities and in support of the 
Commission's efforts, the Bureau of Indian Affairs, Central Office, 
provided $219,000 to the Commission in fiscal year 1991-92. This money 
was used to support the negotiation activities with the LADWP and to 
hire Commission technical consultants. The Commission hired a 
hydrologist, Dr. Woldezion Mesghinna of Natural Resources Consulting 
Engineers, Inc. and a research specialist, Mr. Daniel Gallacher, of 
Historical Research Associates Inc., to investigate and quantify the 
reserved water rights held by the United States on the lands traded to 
the LADWP.
    In August 1992, the Bureau of Indian Affairs agreed that the 
Commission would have the lead role in negotiating with the LADWP while 
the United States would support the negotiations and provide technical 
assistance. The Commission had been in discussions and negotiations 
with the LADWP since early 1992 and had made substantial progress in 
addressing areas of concern to the Owens Valley Tribes. At a meeting 
held in April 1993, discussions between the Commission, its experts and 
the LADWP centered on the reserved water rights retained by the United 
States and the methodology used to quantify those rights.
    Unfortunately, in 1993 negotiations stalled when the Bureau of 
Indian Affairs chose not to continue funding the Commission's efforts 
until the 1993 fiscal year had almost expired in September. It was not 
until October 1993 that the Commission was able to confirm that $88,500 
had been contracted. These funds were used to fund additional studies 
concerning the Practicably Irrigable Acreage Quantification.
    In December 1993, a federal fact-finding team was appointed to 
investigate the water claims filed by the Commission on behalf of the 
Tribes. In September 1994, the team completed its investigation and 
prepared a final report.
    As the negotiations continue, the Tribes' water rights, water 
resources and reservation environments continue to be negatively 
impacted by the City's water gathering activities. In 1994, the 
Commission was successful in securing BIA funding in the amount of 
$200,000 to initiate a groundwater monitoring program and protection 
system for the Owens Valley reservations. Rather than directly contract 
with the Commission to oversee the development of the system, the BIA 
provided these funds to the United States Geological Survey (USGS) to 
develop the system. The system was never developed. The BIA informed 
the Commission that USGS reported having spent over $90,000 to drill 
monitoring wells for the Owens Valley Tribes. In actuality, there were 
no wells drilled by the USGS on any of the Owens Valley reservations 
with these funds. The Commission has on several occasions requested 
from the BIA a copy of the USGS report of work completed. No report has 
been provided. In November 1994, the Commission was informed by the BIA 
that the balance of these funds had been returned to the BIA Central 
Office in Washington and redistributed to another tribe. Consequently, 
the Owens Valley Tribes are without a groundwater monitoring system to 
safeguard their water rights, water resources and reservation 
environments.
    Based on the fact-finding team's report, a federal negotiation team 
consisting of Mr. Dan Jackson, Mr. Bob Laidlaw, and Mr. Curtis Milsap 
was appointed in July 1995, to help facilitate a settlement between the 
Commission and the LADWP. During the rest of 1995 and 1996, the parties 
have met on numerous occasions and have made steady progress. 
Currently, the parties and their consultants are meeting to discuss and 
agree on a quantification of the federally-reserved water rights 
belonging to the Owens Valley Tribes.
    In fiscal year 1995 the Commission received Water Resources 
Protection Funding in the amount of $150,000 and initiated a 
comprehensive Groundwater Monitoring Program. Due to limited funding 
the program is being developed in four phases. The first phase was 
completed in fiscal year 1995 ($34,056). The second phase will be 
completed in fiscal year 1996 ($75,316) and it is anticipated the third 
($40,546) and fourth phases ($39,534) will be completed in fiscal year 
1997.
    The Commission is requesting continued funding to complete these 
negotiations and to provide for the capital start-up costs of actual 
groundwater monitoring. The capital costs include the installation of a 
shallow and a deep acquifer monitoring well on each of the five 
reservations. The amount being requested for fiscal year 1998 is 
$258,068.
                     funding for california tribes
    The Commission strongly feels there has been inequities in the 
amount of funding being provided to California Tribes. For over 100 
years, studies conducted by federal, state and private agencies have 
reached the same conclusion: California Indians are not receiving a 
fair share from federal Indian programs; and because they have received 
less support from the federal government, California Indians have 
suffered in social-economic well-being relative to other Indian groups 
in other states.
    Well-documented reports have come from both Republican and 
Democratic administrations concluding that per capita spending for 
California Indians was below that in other areas. For example, in 1975, 
per capita spending for California Indians was $309.97 of the total 
Bureau allotment, while spending in the Minneapolis Area was $859 per 
person and spending in Portland averaged $1,576 per person. The degree 
of inequity is understated because the Bureau systematically 
undercounts California Indians. In 1989 the Bureau's California service 
population count was 28,815 and the 1990 census count for California 
Indians was 236,078. Approximately 100,000 of the 236,078 California 
Indians are actual Native California Indians.
    The history of federal policy toward California Indians offers 
insight into the weakness of the Bureau's service population criteria. 
The failure of the federal government to ratify the 1852 treaties it 
negotiated with California Indians and to establish a suitable 
reservation land base for them means that the general criteria limiting 
service population to Indians ``on or near reservations'' should not be 
applied in California. This geographic criterion is currently not 
applied to Indians in Oklahoma and Alaska. The number of California 
Indians who participated in claims awards based on past deprivation of 
land proves that the federal government views them as Indians, yet the 
Bureau refuses to recognize their tribal groups.
    Budget analysis from the 1980's and 1990's confirms that these 
inequities have persisted. Based on the Operation of Indian Programs 
and the BIA's official service population figures for the years 1990 to 
1994, California Indians are receiving only one-third to one-half the 
funding received by all other Indians. In 1994, for example, the 
Sacramento's per capita funding was $700.30 while the rest of the BIA-
served Indian population enjoyed per capita funding of $1,310.51.
                 reduction in natural resource funding
    The continual reduction in appropriated funds for the BIA's natural 
resources budget, including water resources, is unjust. Only five 
tribal governments in California have quantified their water rights. 
Consequently, there is a lot of future work to be done on tribal water 
rights issues in the State of California, let alone in the Owens 
Valley, and funding is needed to perform this work.
                bia natural resources funding reductions

                             FUNDED FIGURES                             
                        [In thousands of dollars]                       
------------------------------------------------------------------------
          Category               1991       1992       1994       1996  
------------------------------------------------------------------------
Water resources.............    $11,123    $10,353     $5,507     $3,682
Total natural resources                                                 
 (including water resources)     79,992     78,041     64,224     53,489
------------------------------------------------------------------------

    The Commission requests that Congress increase the BIA's Water 
Resources funding to $10 Million in fiscal year 1998, with at least $1 
Million earmarked for California Tribes for each of the next five 
years. In addition, the Commission urges the House Appropriations 
Committee on Interior Appropriations to recognize the inequities in 
funding for California Tribes and provide per capita funding for 
California Tribes that is equal to the rest of the BIA-served Indian 
population.
                                 ______
                                 

  Prepared Statement of Jones Begay, President, Association of Navajo 
                   Community Controlled School Boards

    I am honored to submit this statement on behalf of the Association 
of Navajo Community Controlled School Boards--an association of 13 BIA-
funded schools on the Navajo Reservation operated by local tribal 
school boards under contracts or grants with the BIA. In addition to 
serving as President of the Association of Navajo Community Controlled 
School Boards, I am also a delegate to the Navajo Nation Council and am 
President of the Black Mesa Community School Board which operates a 
small school for 100 Navajo children in a very isolated area of the 
Navajo Reservation in Arizona.
    Our comments focus on the portions of the BIA School Operations 
budget most in need of your serious attention.
                         student transportation
     We need a significant increase in funding for this budget which 
supplies the funds for operation of our school bus systems. These funds 
are allocated on a per-mile basis, but the per-mile rate--currently at 
only $1.60--is far, far below the costs we incur. At Black Mesa, our 
100 students are scattered over a large geographic area that requires a 
daily bus run of just under 500 miles. Our buses run primarily on un-
improved roads. This makes for a very long bus ride in both the morning 
and afternoon. Our bus driver costs, fuel costs and bus maintenance 
expenses are very high--far higher than $1.60 per mile.
    Our problems will get worse very soon, as the moratorium on 
increases in the school bus lease rate charged by GSA will soon end. We 
expect large increases in these lease rates.
    Funding for student transportation has never been sufficient to 
meet our costs. This means we must take scarce dollars from the funds 
you supply for our instructional programs to supplement student 
transportation. We have no choice. If we cannot bring the children to 
school, we cannot educate them.
    We ask you to significantly increase the BIA budget request for 
student transportation to a level that can provide us with the national 
average per-mile rate for public schools: $2.92 per mile.
                       administrative cost grants
    This is the budget that enables tribal school boards to exercise 
the Indian self-determination rights guaranteed by Congress. It funds 
our indirect and administrative costs. Without adequate funding in this 
account, tribal school boards do not have the funds they need to 
properly run the administrative responsibilities they take on when they 
decide to operate a school.
    BIA asks for an increase of $2.5 million for Administrative Cost 
Grants. This does not mean that individual schools Administrative Costs 
are increasing. Rather BIA seeks the increase because 12 more schools 
will convert from BIA operation to tribal operation in school year 
1998-99, the school year funded by the fiscal year 1998 budget request. 
Ten schools will convert to tribal operation in the upcoming school 
year.
    We are not sure that the $2.5 million increase will be sufficient 
to supply the Administrative Cost Grants of the ``converted'' schools 
because the BIA's budget does not explain how it was calculated. If it 
is not enough, all the existing schools will suffer a reduction in 
funding. We ask you to find out now if it is enough. Please do not wait 
for us to come back in two years to tell you it was insufficient.
Severance costs
    When a school ``converts'' from BIA operation to tribal school 
board operation, two funding events occur: (1) the school becomes 
eligible for an annual Administrative Cost Grant; and (2) the BIA 
incurs a one-time severance cost for the federal employees who worked 
at the school. These severance costs must be paid even if these former 
federal employees are re-hired by the tribal school board.
    The BIA budget justification does not identify the amount of 
severance costs that will be incurred, nor does it state from which 
budget category the funds will be supplied. The BIA education law does 
not permit these severance costs to be paid from any of the funds 
Congress supplies for School Operations. The reason is, of course, that 
School Operations funds are intended for program and administrative 
costs of the schools, not for severance pay for former federal 
personnel.
    We ask you to include report language that reminds BIA it may not 
use ISEF funds, Administrative Cost grant funds, student transportation 
funds or any other School Operations monies for employee severance pay.
                  facilities operation and maintenance
    The federal government owns the buildings in the BIA school system. 
This means that Congress and BIA should be as interested as we are in 
making sure these buildings are maintained properly. But year after 
year, insufficient funds are provided for operation and maintenance of 
our federally-owned school buildings.
    Several years ago Congress ordered BIA to develop a formula for 
calculating the amount of funding that should be provided for 
facilities maintenance. For the past several years, we have received 
only about two-thirds of the amount this formula requires.
    When this happens, building maintenance is sacrificed. We cannot 
cut corners on our electricity bills, or water bills or heating bills. 
We have to pay these in full. And we must make sure our boilers and 
fire safety systems are operating properly and that the buildings are 
kept clean. This leaves very few dollars for preventive maintenance and 
minor repairs. When these do not get done, our buildings deteriorate at 
a fast rate.
    We ask that you increase the school facilities O&M budget by one-
third (to $99 million) to preserve the investment the United States has 
made in these buildings.
                            teacher housing
    The final word I want to offer is about the need for decent housing 
for teachers at reservation schools. At Black Mesa, we have to supply 
housing for our teachers because there is no private rental housing 
available. This is the situation at nearly every school in the BIA 
system.
    We would be grateful if Congress could establish even a small 
recurring funding program for employee housing construction--perhaps 
$1-2 million per year. Without teachers, even the finest school in the 
BIA system would not be able to do its job. And without housing, we 
cannot recruit teachers.
    We thank you for your interest in the welfare of the Indian 
children in the BIA school system.
                                 ______
                                 

Prepared Statement of Apesanahkwat, Chairman, Menominee Indian Tribe of 
                               Wisconsin

    On behalf of the Menominee Indian Tribe of Wisconsin, I wish to 
submit this statement on the President's fiscal year 1998 budget 
request for programs in the Bureau of Indian Affairs (BIA). Our 
specific concerns include: Adequate funding for Law Enforcement; 
funding for Road Maintenance above the President's requested level of 
$27.5 million; increased funding for Conservation--Other Rights 
Protection program; adequate funding for the tribal judicial systems; 
funding for Construction--Infrastructure Development; full funding of 
Contract Support Costs; funding Education--School Operations, at a 
minimum, the President's requested level of $467 million.
    As the Subcommittee may know, the Menominee Tribe was one of the 
recognized tribes terminated in the 1950's. Since regaining our federal 
recognition 20 years ago, we have endeavored to exercise our self-
determination to achieve the self-sufficiency that is the goal of all 
tribes. We have made strides in improving the quality of life for our 
tribal members through careful management of our natural resources and 
economic development ventures such as the Menominee Nation Gaming 
Corporation. Yes, we are a gaming tribe but our business is only 
moderately successful--generating about $750,000 a month in revenue. 
The Menominee Tribe utilizes this much needed income to not only 
supplement federally-funded programs but to fund programs for which 
there are no other available resources. Some examples of uses for these 
revenues include: solid waste disposal ($500,000/yr.), graduate 
scholarships ($62,9000/yr.), tribal and youth recreation programs 
($360,500/yr.), and infrastructure development ($2 million since 1994 
for water and sewer systems in the new Middle Village tribal housing 
development, community-wide road projects and updated telephone system, 
etc.).
    We are, however, experiencing increased demands on these limited 
revenues due to decreased funds from the state and/or county in areas 
such as welfare assistance and support for the public library located 
on our reservation. We bring these matters to your attention to 
highlight that while self-sufficiency is our goal, we require the 
continued assistance of the federal government through adequate funding 
of the federal programs we operate for the benefit of our tribal 
members.
                        bureau of indian affairs
    Tribal law enforcement.--The Menominee Police Department is a 38-
member force, funded by $866,200 through the BIA and supplemented by 
$1.23 million in tribal funds. Still this amount is not adequate for 
providing the level of public safety and enforcement of tribal, 
federal, and state laws necessary for the size of our community--which 
covers 360 square miles and serves a tribal population of over 4,000 
members. As noted above, tribal revenues are limited and the need to 
supplement other programs increases with each fiscal year. We, 
therefore, request that Congress support, at a minimum, the 
Administration's request for a general increase of $46.7 million to the 
Tribal Priorities Allocation (``TPA'') account, which includes an $8.7 
million increase for law enforcement.
    Road maintenance.--The Administration's request of $27.5 million 
for Road Maintenance shows only a small increase--less than $2 million 
over the amount for the past two fiscal years, and still less than one-
third of the annual need in Indian country. Funds in this line item are 
not only utilized for routine maintenance and administration of roads, 
but also for maintenance of bridges, airstrips, ferry boat operation 
and maintenance and emergency maintenance (snow removal, ice control, 
washout repair, etc.). The transfer of Road Maintenance to the Tribal 
Priority Allocations account has negatively impacted the availability 
of funds. In fiscal year 1997, the Menominee Tribe suffered a 16 
percent decrease in Roads funds. Coupled with extreme weather 
conditions and heavy snowfall, we now face extreme funding problems as 
we have only $10,000 balance for the remaining half of the fiscal year. 
With these remaining scarce dollars, we seriously doubt the Menominee 
Tribe will be able to maintain its 308 miles of BIA roadway in 
accordance with the mandates of Federal Highway Safety guidelines.
    We would urge Congress to fund Road Maintenance at 100 percent of 
need to enable tribes to address the backlog, and to order Road 
Maintenance removed from TPA.
    Other rights protection.--The Menominee Conservation Department is 
charged with establishing and enforcing the tribal hunting laws within 
the boundaries of the reservation. This area encompasses over 235,000 
acres, with 80 lakes and more than 300 miles of rivers and streams. The 
Conservation Department also conducts wildlife studies, direct fish and 
wildlife management projects and conduct research projects. These 
activities not only ensure the protection and conservation of our 
natural resources but will also, hopefully, reclaim some of the 
traditional food sources of the Menominee. Currently, the Conservation 
Department is comprised of six game wardens, one Fish and Wildlife 
Biologist/Manager and one support staff, operating on a budget of 
$375,000 (one-third of which amount is provided by the tribe).
    In order to adequately enforce the laws and properly manage the 
Tribe's natural resources, we request that Congress increase funds for 
this vital program.
    Tribal courts.--We have testified previously on the need to 
properly fund the tribal court systems. As you may recall, the Indian 
Tribal Justice Act, Public Law 103-176, was enacted to provide 
additional resources for the development and enhancement of tribal 
judicial systems. Unfortunately the Bureau has never requested 
additional funds for tribal courts as authorized by Public Law 103-176 
and the Special Tribal Courts program has been eliminated. Furthermore, 
even if Congress funds Tribal Courts at the Administration's requested 
level of $11.1 million, it would be $3 million less than the fiscal 
year 1995 enacted level. The Menominee Tribe, like many other Indian 
nations and courts in general, is facing increased burdens on the court 
due to a rising number of cases and understaffing. In spite of the 
approximately $217,000 tribal supplement to the Tribal Court budget, we 
are not able to adequately meet the need. We ask this Subcommittee to 
continue to assist all tribes in meeting the judicial needs of their 
people by appropriating an increased and specified funding level for 
Tribal Courts apart from the TPA account.
    Construction.--A critical need for many tribes is in the area of 
infrastructure development, e.g. water and sanitation systems, new 
roads, installation of utilities. As you are no doubt aware, many 
tribes, including the Menominee, are faced with increasing 
populations--due to an influx of tribal members returning to the 
reservation, an increased birth rate and increased longevity. We 
recommend that the Subcommittee consider a separate funding category 
under the Construction account for infrastructure development 
initiatives.
    Contract support.--The Menominee Tribe is disappointed that the 
Administration only requests $105.8 million for Contract Support Funds 
(CSF), as funding at this level would not fully fund the need. 
According to the Bureau's Budget Justification, the $105.8 million 
would enable the BIA to pay only 95 percent of the CSF need. In fiscal 
year 1997 they paid only 87 percent of need. Every time CSF is not 
fully funded, our programs suffer.
    The Indian Self-Determination Act is clear that the Secretary must 
fully fund contract support cost needs. The transfer of CSF to the 
Tribal Priority Allocations account merely masks the true level of need 
since tribes must make up for contract support cost shortfalls by using 
direct program funds. In doing so, we diminish services in those 
programs. We urge that Congress fully fund this essential program cost 
as required by law.
    Education--school operations.--The Menominee Tribe urges Congress 
to fund, at a minimum, the Administration's requested level of $467 
million for School Operations. The Menominee Tribal School, a tribal 
contract school, serves 248 students in grades K to 8. We note that 
although the requested level may result in a nominal increase to the 
amount per student we receive for each student, there will continue to 
be severe funding shortages in the Transportation and Facilities 
Operation and Maintenance activities. We hope Congress will improve the 
Administration's request and supply additional funding for these 
critical activities.
    The Menominee Tribe appreciates the support this Subcommittee has 
given to our Tribe over the years and thank you for the opportunity to 
provide our views on the proposed fiscal year 1998 budget for the 
Bureau of Indian Affairs.
                                 ______
                                 

  Prepared Statement of W. Ron Allen, President, National Congress of 
                            American Indians

                              introduction
    Greetings Chairman Gorton, Senator Byrd and distinguished members 
of the Interior and Related Agencies Appropriations Subcommittee. On 
behalf of the National Congress of American Indians and our 200 plus 
member Tribes, I appreciate this opportunity to submit testimony 
regarding the President's budget request for fiscal year 1998 Indian 
programs and services under this subcommittee's funding jurisdiction. 
My name is W. Ron Allen. I am President of the National Congress of 
American Indians (``NCAI''), the oldest and largest Indian organization 
in the nation devoted to protecting Tribal sovereignty, and Chairman of 
the Jamestown S'Klallam Tribe located in Washington State.
                         background information
    Mr. Chairman, it has rarely, if ever, occurred that programs 
serving the American Indian and Alaska Native population have received 
the federal funding required to fulfill even the most basic needs of 
tribal members. American Indians and Alaska Natives rank at the bottom 
of most social and economic indicators. Of the 557 federally-recognized 
Indian Tribes, a great majority of their populations are characterized 
by severe unemployment, high poverty rates, ill-health, poor nutrition 
and other sub-standards living conditions. In 1989, the average 
unemployment rate in Indian Country was 52 percent, and by 1990 the 
rate had jumped to 56 percent.\1\ The 1990 Census shows the percentage 
of Indian people living below the poverty line is 31.6 percent, or 
three times the national average.
---------------------------------------------------------------------------
    \1\ See generally ``1990 Census Population--Characteristics of 
American Indians by Tribe and Language,'' U.S. Department of Commerce, 
economic and Statistic Administration, Bureau of the Census.
---------------------------------------------------------------------------
    Tribes have faced extraordinary challenges throughout the 
appropriations process in recent years. Unprecedented reductions in 
federal Indian program funding have left many Tribes facing extreme 
circumstances. Non-funding riders attached to Interior Appropriations 
bills reached well past the scope of the appropriations process and 
attempted to diminish Tribal sovereignty and change the basic fabric of 
the federal-tribal relationship. Further, while we appreciate the 
commitment to balance the federal budget, we maintain that such a 
laudable initiative does not and should not preclude the federal 
government from fulfilling its trust responsibilities to Indian Tribes 
throughout this great nation. As Congress begins to shape the fiscal 
year 1998 budget, the NCAI urges the reversal of the downward direction 
the annual appropriations process has taken on Indian programs. We 
believe that the President's fiscal year 1998 budget request has taken 
a very positive step in that direction.
            the president's fiscal year 1998 budget request
A. Bureau of Indian Affairs
    The President's fiscal year 1998 budget calls for $1.7 billion to 
be allocated to the BIA, an increase of $127 million over the 1997 
enacted levels. As important as these increases in funding are to 
Tribes, and despite the apparent commitment to Tribal self-governance, 
this increase is but a mere step in the direction of providing adequate 
funding and only begins to correct the recent unprecedented reductions 
in critical tribal programs.
    Tribal priority allocations.--Tribal Priority Allocations (TPA), 
the mainstay in the BIA budget for Tribal operations funding, were 
decreased by nearly $100 million in fiscal year 1996. This occurred 
during the same cycle that over $200 million in programs and services 
were shifted from other areas of the BIA budget into TPA in an effort 
to give tribal governments more control over those tribal operations. 
The President's fiscal year 1998 budget for TPA is $757.3 million, an 
increase of $76.5 million over the fiscal year 1997 enacted level. The 
majority of these increases are earmarked for Tribal Government 
Operations and Human Services, which combined cover a broad spectrum of 
services provided at the Tribal level for its communities, children and 
families, elderly and poor, and government operations such as police 
and fire protection. Of special concern to our member Tribes is the 
lack of funding for the Indian Tribal Justice Act (Public Law 103-176) 
and the Indian Child Protection and Family Violence Prevention Act 
(Public Law 101-630, Title IV), both considered ``New Starts'' under 
current Congressional budget categorization, for which no funding is 
appropriated. We urge this Congress to consider the mounting needs for 
these programs, especially their significance in supporting a Tribe's 
ability to implement welfare reform in Indian Country, and fund these 
line-items at their authorized levels. Mr. Chairman, TPA funding in 
particular must be increased in order to improve the quality of life 
for Indian communities.
    BIA construction.--The NCAI urges support of the President's 
request of $125 million for Construction funding. Our schools, courts, 
police and fire departments all have facilities that are in desperate 
need of repair or replacement. Many Tribal communities are still 
awaiting much needed new construction project funding to rehabilitate 
or replace these and other facilities, including dams and other 
resource projects. Every year, these facilities face increased safety 
hazards that must be addressed through proper maintenance and re-
engineering projects. The President's request for BIA Construction 
projects is a step in the right direction.
    Indian trust funds.--Management of Indian Trust Funds is in dire 
need of reform. Without a commitment from the Administration and 
Congress that ensures adequate funding levels and that oversight is 
provided, the overwhelming amount of mismanaged and unidentified trust 
fund accounts over the last 50 years will never be reconciled. It is in 
the best interest of all parties that the reconciliation of Individual 
Indian Monies (IIM) accounts and trust land asset accounts are 
resolved.
    The Office of Special Trustee for American Indians (OSTAI) has 
submitted a draft strategic plan for trust fund management. This plan 
would fundamentally change the way trust activities are managed by the 
federal government. The Special Trustee has recommended that all trust 
management duties, responsibilities and activities including Trust 
Resources Management, Trust Funds Management and Land Title and Records 
Management be carried out by a new federal government sponsored entity 
that would exist outside of the Department of Interior. This strategic 
plan has gone far beyond its initial mandate to review the financial 
condition of Indian trust accounts. NCAI would urge the Committee to 
not support this plan until complete and meaningful consultation has 
occurred with Tribal governments.
    Indian education.--NCAI joins with the Administration and the 
Congress in renewing our country's commitment to education and in 
supporting ambitious elementary and secondary education proposals. NCAI 
also welcomes the significant investment in Indian education. The $500 
million request, which represents an increase over fiscal year 1997 
enacted levels, will help meet some of the needs of Indian students 
attending Bureau-funded schools. The increase of $16.8 million over 
fiscal year 1997 for School Operations will help the Bureau deliver 
quality education, provide safe transportation, and convert Bureau 
operated schools to grant schools. However, the funding levels for 
other primary and secondary Indian education programs fail, once again, 
to meet the growing needs of our Indian students attending Bureau-
funded schools.
    Major educational programs that further opportunities for learning, 
enhance the learning environment of Indian students, and merit 
particular attention include: Adult Education--with the elimination of 
OIE's adult education program, BIA adult education must at least be 
funded at $4 million; Johnson O'Malley (JOM)--the real need in JOM is 
$54 million which will help alleviate current program funding 
restraints heightened by a 5 percent increase in JOM students in fiscal 
year 1997; Indian Student Equalization Program (ISEP)--the $296 million 
request will provide $3,094 per Weighted Student Unit (WSU). This per 
student outlay is significantly below the average per student 
expenditure of public elementary and secondary schools which had a 
$6,300 per student outlay in school year 1995-96; Replacement School 
Construction--$14 million is requested, an increase of $10 million over 
fiscal year 1997 which is needed for completion of the Many Farms High 
School. Although we support this project, we urge additional funding 
for the construction of additional new schools; Facilities Improvement 
and Repair (FI&R--$32.2 million is requested for education FI&R which 
will help to address the material weakness in Bureau schools. However, 
additional funding is still needed to address the current backlog of 
over $600 million in this program. The NCAI supports the National 
Indian Education Association (NIEA) statement to this Subcommittee on 
the President's fiscal year 1998 budget as it affects Indian Education.
    Cultural and historical preservation.--The Native American Graves 
Protection and Repatriation Act, Public Law 101-601 (NAGPRA), provides 
the legal basis for the return of sacred objects and human remains, as 
well as for the protection of burial sites, and is critical in 
correcting many errors of the past and present. However, NAGPRA cannot 
bring about a better future until adequate funds are appropriated so 
that Tribes can complete the repatriation process, and continue to 
protect our people's heritage. Despite a continual joint Tribal-museum 
request of $10 million from fiscal year 1994 through fiscal year 1997, 
Congress has appropriated only a fraction of that amount--$2.3 
million--for NAGPRA related grants. This funding level is far below the 
projected need to comply with the provisions of the Act and well below 
the $10 million request. The President's fiscal year 1998 budget 
request of $2.3 million must be increased by Congress in order for 
Tribes to implement the goals of NAGPRA.
    Many of our member tribes also rely on the protections available 
under the National Historic Preservation Act, Public Law 89-665 (NHPA). 
There are currently 14 tribes which have signed agreements with the 
National Park Service regarding the assumption of State Historic 
Preservation Offices (SHPO) duties. That number is expected to triple 
within the next year with more Tribes continuing to take on the role of 
SHPO'S. This activity alone supports the need for increased funding, 
however NHPA allocations fell from $2 million in fiscal year 1996 to 
$1.8 million in fiscal year 1997. In order to preserve our nations vast 
history and the cultural traditions of our people, the President's 
fiscal year 1998 budget request of $2.3 million must be supported by 
Congress as the minimum standard funding level to allow Tribes to carry 
on this important work.
    National Indian Gaming Commission (NIGC).--The NIGC performs 
critical functions in overseeing Tribal gaming operations and should be 
funded at an annual appropriation of $10 million. The NIGC receives 
$1.5 million annually from fees on Class II gaming and receives 
approximately $1 million from appropriations. The NIGC has been 
functioning at approximately a $4.2 million annual operating expense 
level, but this level of funding is threatened because the NIGC will 
run out of start-up monies in fiscal year 1997. Under this scenario, 
the NIGC will have a $1.7 million deficit in fiscal year 1998. In order 
to remedy this situation, the $1.5 million dollar cap on fees from 
Class II gaming should be removed, and fees should be extended to Class 
III gaming. If the cap is not removed, the Administration contributions 
should be increased to $2.7 million in order to maintain the current 
minimum operations. The NIGC has the regulatory authority that is 
necessary and appropriate to ensure that Tribal gaming can continue 
with the same exemplary record that it has compiled to date. In the 
absence of adequate funding, NIGC's abilities to meet its 
responsibilities will be severely impaired, and the future of Tribal 
gaming will be at risk.
B. Indian Health Service
    Funding for the Indian Health Services (IHS) is allocated in two 
distinct categories--Services and Facilities. The President's fiscal 
year 1998 budget request of $2.1 billion for the IHS is a marginal 
increase over the fiscal year 1997 enacted levels; however, 
approximately $367 million more is needed to restore the funding 
decreases over the past few fiscal years. These reductions have led to 
an increase in unmet needs surrounding mandatory costs, mandatory 
contract support, facility construction costs, and inflationary costs 
under Contract Health Care programs and must be rectified.
    IHS services.--The President's $1.8 billion request is a $29 
million increase over the fiscal year 1997 enacted level. Although 
Services funding continues to show marginal increases every year, these 
slight increases do not meet the current needs of approximately $2.04 
billion. It is estimated that nearly half of the nation's Indian 
population live in the urban areas of this country. Tribal governments 
continue to share in the duties and responsibilities of providing 
health care for those individuals living in urban areas in conjunction 
with the federal government. For these reasons it is critical that our 
clinical services, including hospitals and health clinics, as well as 
our preventative health care programs receive adequate funding to keep 
pace with the increased needs of our service area populations, both in 
the Tribal communities and the urban areas.
    For example, the IHS budget for the HIV/AIDS program does not cover 
the cost of drugs to treat Indian people infected with HIV. We are 
aware that the cost of these drugs is significant; however, we are also 
concerned that Indian people infected with HIV whose only source of 
medical care is the IHS may not receive proper care if they and their 
physicians do not have access to these life-saving drugs. NCAI 
recommends a restricted line item in the IHS budget that covers the 
cost of AIDS-related medications.
    IHS facilities.--The President's request for $300 million for IHS 
Facilities--an increase of nearly $39 million over last year, is a 
welcomed change in the direction of Facilities funding. However, 
funding levels for IHS Facilities must be increased to approximately 
$149 million in order to maintain health care facilities in Indian 
Country. Tribes have reported that facilities are struggling to keep 
pace with the needs of the service areas. Old facilities are in need of 
major improvements and some service areas require the erection of new 
facilities. I urge this Congress to make one of its goals the renewed 
support for increased health care facilities in Indian Country and to 
start this commitment by supporting the President's fiscal year 1998 
budget request for IHS Facilities.
    Indirect costs.--Although funding levels for the Indian Health 
Services have gradually increased over the last two years, changes in 
allowable costs associated with these operations have created 
additional financial burdens on Indian health care systems. Of concern 
to every Tribal program manager was Congress' elimination of funding 
for indirect costs associated with the administration of Indian 
programs and services. This action, which began with the passage of the 
fiscal year 1995 Rescissions bill and continued through the fiscal year 
1996 appropriations process, creates substantial reductions (up to one-
third in some cases) in actual operating budgets. Indirect costs 
associated with health care services are inherently higher than other 
areas of operation. In the non-Indian communities, health care 
operations were better able to absorb these indirect cost restrictions 
by passing on those additional costs to the states, their patients, and 
other forms of cost reimbursements. Tribes do not have this ability and 
are forced to absorb these costs by eliminating or reducing funding for 
other tribal operations.
    Welfare reform.--Federal welfare reform has created an even greater 
need for Tribal governments to directly administer certain Medicaid and 
other welfare services closely tied to the health care arena. IHS must 
provide technical assistance and other support funding for Tribal 
governments faced with developing new Tribal programs and services, or 
operating through state initiated programs that do not meet the unique 
needs of Indian people. Direct funding for these new Tribal programs 
will protect the ability of Tribal governments to provide for their 
members.
                               conclusion
    Mr. Chairman, we urge the Congress to fulfill its fiduciary duty to 
American Indians and Alaska Native people and to uphold the trust 
responsibility as well as preserve the Government-to-government 
relationship, which includes the fulfillment of health, education and 
welfare needs of all Indian Tribes in the United States. Tribes 
throughout the nation relinquished their lands as well as a great 
multitude of resources in exchange for this trust responsibility. The 
President's fiscal year 1998 budget acknowledges the fiduciary duty 
owed to Tribes. We ask that the Senate consider the funding levels in 
the President's budget for the Department of Interior and Related 
Agencies as the minimum funding levels required by Congress to maintain 
the federal trust responsibility and by Indian Country to continue on 
our journey toward self-sufficiency. This concludes my statement. Thank 
you for allowing me to present for the record, on behalf of our member 
tribes, the National Congress of American Indians' initial comments 
regarding the President's fiscal year 1998 budget.
                                 ______
                                 

 Prepared Statement of Ted Strong, Executive Director, Columbia River 
                      Inter-Tribal Fish Commission

    Mr. Chairman, on behalf of the Columbia River Inter-Tribal Fish 
Commission (CRITFC), thank you for the opportunity to present the 
Commission's views on how the budget for the Bureau of Indian Affairs 
(BIA) should be structured to meet tribal fishery resource needs. For 
fiscal year 1998, the CRITFC has identified needs totaling $9,506,433 
for Columbia River fisheries management and associated programs, an 
increase of $7.014 million over the fiscal year 1997 appropriated level 
of $2.493 million. The total needs identified includes continued 
funding for fisheries management, the Columbia River tribes' planning 
efforts involving the Columbia River Gorge Scenic Act, Columbia River 
Habitat Programs, Columbia River Endangered Species Program, and 
critical Watershed Restoration activities, as well as past under-
recovered pay cost adjustments, totaling $103,903, mandated by law. In 
addition, the administration has proposed, and we support, funding 
enforcement activities at ``in-lieu'' fishing access sites at $250,000 
in fiscal year 1998. Finally, the Columbia River tribes receive funding 
for participation in the Pacific Salmon Treaty process, consistent with 
annual recommendations of the U.S. Section of the Pacific Salmon 
Commission. We support the U.S. Section recommendation for fiscal year 
1998, at the funding level of $3,152,046 for the Pacific Salmon Treaty 
program in the BIA, with CRITFC and its member tribes to receive 
$861,305 of that amount, plus fiscal year 1997 and fiscal year 1998 pay 
cost adjustments.
               direction to interior and related agencies
    In addition to the funding levels identified above, we ask that you 
direct the Bureau of Land Management, United States Forest Service, 
National Biological Survey, and the U.S. Fish and Wildlife Service to 
enter into cooperative agreements or 638 contracts as provided for 
under Public Law 103-413, with the CRITFC and with each of the 
individual member tribes in order to provide funding for coordination, 
participation, and project implementation under the several recovery 
plans. Each of the listed federal agencies has had several years during 
which to apply appropriated funds to implement authorized programs that 
would provide for healthy and sustainable fisheries; the tribes believe 
that it is now time for them to be given the opportunity to reach this 
goal.
                           mission statement
    The CRITFC was formed by resolution of the Nez Perce, Umatilla, 
Warm Springs and Yakama Tribes for the purpose of coordinating fishery 
management policy and providing technical expertise essential for the 
protection of the tribes' treaty-protected fish resources. Since 1979, 
the CRITFC has contracted with the BIA under the Indian Self-
Determination Act (Public Law 93-638) to provide this technical 
support. The CRITFC's primary mission is to provide coordination and 
technical assistance to the member tribes to ensure that outstanding 
treaty fishing rights issues are resolved in a way that guarantees the 
continuation and restoration of our tribal fisheries into perpetuity. 
The Commission's technical experts, in coordination with the tribes' 
technical experts, have identified where the land and water managers as 
well as state and federal fishery managers have fallen short in 
protecting and restoring the habitat and production of all salmon 
stocks and we have, at the request of the tribes, provided 
recommendations for correcting management practices that have led to 
the loss and destruction of salmon and its habitat. The tribes' 
restoration plan documents the threats to their fisheries, identifies 
hypotheses based upon adaptive management principles for addressing 
these threats, and provides specific recommendations and practices that 
must be adopted by natural resource managers to meet their treaty 
obligations. The tribes' ultimate goal is to restore a sustainable 
resource for the benefit of all peoples in the Pacific Northwest, the 
following programmatic descriptions briefly describe how the tribes 
hope to achieve that goal.
                    watershed restoration cost share
    For the Fisheries Services programs, $5.5 million of the proposed 
increase is for the watershed-based salmon restoration program. The 
tribes have identified $30 million in habitat restoration work that 
must take place in the Columbia River Basin in order to begin to 
restore salmon populations. Of this work, about half is located on 
tribal reservations and ceded lands; therefore, the tribes must be 
prepared to manage and administer at least $15 million in watershed 
restoration activities, and will need to provide the required 25 
percent match. The $30 million will come from regional sources, for 
example, from the Northwest Power Planning Council's Fish and Wildlife 
Program funded by the Bonneville Power Administration. So, out of the 
$5.5 million, $3.75 million will provide the required 25 percent match 
for $15 million of tribal watershed restoration activities. That is, 
every dollar provided through appropriations for this program will 
leverage a three dollar match from regional funds. The cost share 
monies will go directly to tribal governments implementing projects. Of 
the balance of the $5.5 million, $1 million will be used to support 
building tribal capacity to administer and manage the habitat 
restoration activities and $750,000 will be used to direct a Columbia 
Basin habitat monitoring program to monitor the effectiveness of the 
$30 million in watershed projects. In lieu of the $3.75 million 
identified for BIA cost-sharing on watershed restoration projects, the 
Bureau of Indian Affairs could facilitate efforts between each of the 
four tribes and their Commission and the Bureau of Land Management, 
United States Forest Service, National Biological Survey, and the U.S. 
Fish and Wildlife Service to enter into cooperative agreements or 638 
contracts as provided for under Public Law 103-413, in order to provide 
funding for this cost share.
                     watershed restoration outreach
    An important aspect of implementing the watershed restoration 
program throughout the Columbia River Basin will be explaining the 
benefits of the program to the potential partners in out year programs. 
The tribes believe that additional benefits might be realized through 
private corporations or citizens participating in the watershed 
restoration effort, either directly through identified projects or 
through the independent development of complementary projects. 
Developing and encouraging this type of participation, as well as 
explaining the benefits of the underlying program, will require 
extensive public outreach efforts. The estimated cost for this 
component is $200,000 for fiscal year 1998.
               columbia river endangered species program
    In January 1991, at the Bureau of Indian Affairs' request, the 
Commission submitted an assessment of our foreseeable needs regarding 
outstanding hunting and fishing rights. We requested $600,000 for 
determining the proper allocation of the conservation burden among all 
sources of salmon mortality in the Columbia and Snake basins and 
$400,000 for implementing hatchery production reform. The majority of 
these funds are to be distributed to the tribal fishery programs, with 
the remainder to the Commission for coordination and additional 
technical support. These programs represent on-going needs; thus far 
only $300,000 has been provided under the Columbia River Endangered 
Species Program, leaving an unmet need of $700,000. The tribes and 
Commission would utilize the balance of the funds consistent with both 
salmon restoration plans and our on-going programs.
                    enforcement at ``in-lieu'' sites
    Under Public Law 100-581, the Congress authorized the U.S. Army 
Corps of Engineers to acquire and develop access sites and facilities 
along the Columbia River to replace usual and accustomed fishing places 
inundated as a result of the construction of Bonneville Dam, known as 
``in-lieu'' sites. Once these in-lieu sites are acquired and developed 
by the Corps, they will be turned over to the Department of the 
Interior, Bureau of Indian Affairs, for administration as Treaty 
Fishing Access Sites. Administration of these sites will involve 
increased enforcement responsibilities, which is estimated at $250,000 
for fiscal year 1998.
                    protection of cultural resources
    Under the several salmon restoration plans being reviewed for 
implementation in the Columbia River basin, there are several proposals 
that will affect river operations, ranging from reservoir pool draw 
downs to naturalized river flow options. Under any of these scenarios, 
river level elevations will decline, leading to exposure of tribal 
cultural sites, including tribal burial sites. Protection of these 
cultural and religious resources, including criminal and civil 
penalties, are provided pursuant to the Archaeological Resources 
Protection Act and the Native American Graves Protection and 
Repatriation Act. The additional costs associated with enforcement 
activities to protect these resources are estimated at $500,000.
    As for the Commission's ongoing programs, the work of the 
Commission's staff is being undermined by the manner in which the 
Bureau of Indian Affairs is providing funds for the indirect costs of 
these programs:
Contract support/indirect costs
    Each of the last three years, indirect cost reimbursement to the 
CRITFC has fallen between $80,000 to $100,000 below legislated levels. 
We are concerned that this shortfall will continue to increase, unless 
Congress takes action to ensure that contract support requirements are 
fully financed.
    Current estimates indicate the BIA will have a 10 percent shortfall 
in paying indirect costs for 1997.--While a separate fund has been 
established to provide indirect cost reimbursements for new contracts, 
indirect cost funds for ongoing contracts still fall far short of 
program requirements. This continuing trend has serious ramifications 
for the Commission's operations, such as deferring computer equipment 
purchases, and curtailing support services needed to meet the 
organizational mission.
    In addition, indirect cost shortfalls have the effect of amplifying 
the Commission's indirect cost rate due to the under-recovery of 
indirect costs. That is, the Commission operates with an indirect cost 
recovery deficit and must attempt to cover that deficit when applying 
for other federal and non-federal grants in order to have the 
capability to support the grant project. On the other hand, if the BIA 
provides full indirect cost reimbursements on BIA funds, our indirect 
cost rate will be dramatically reduced and we will be better able to 
persuade other governmental and non-governmental entities to provide 
program funding.
Pay-cost adjustments
    Add $103,903 to provide for under-recovered pay cost and inflation 
for adjustments for 1992, 1993, 1994, 1995, and 1996. Direct BIA to 
insure that all Public Law 93-638 contracts are treated in accordance 
with these annual adjustments.
    Several years ago the Committee directed the BIA to stop ignoring 
the Commission contract in making the normal annual pay cost and 
inflation adjustments being afforded BIA operations and other Public 
Law 93-638 contractors. For a number of years the BIA complied, prior 
to 1992. While the BIA has provided pay cost adjustments for fiscal 
year 1997 and fiscal year 1998, we would ask that the Committee direct 
the BIA to provide full adjustments for the fiscal years 1992, 1993, 
1994, 1995, and 1996.
    Finally, only last week we received a copy of the draft ``Strategic 
Plan to Implement Reforms Required by the American Indian Trust Fund 
Management Reform Act of 1994.'' While certain aspects of the draft 
plan may have merit, we are concerned that it still require 
considerable study. Relative to this Commission's primary mission, we 
are concerned about the new proposal in the draft plan to create an 
independent organization--outside the Department of the Interior--to 
assume all trust asset management functions. How this might relate to 
fishery resources is unclear; in fact, there are many unanswered 
questions. Clearly, this proposal requires considerable review and 
examination by the tribes. We believe that appropriations to fund 
implementation of those parts of the plan that relate to removing 
functions from the Bureau of Indian Affairs should not be provided 
until the tribes have had a full opportunity to review and evaluate 
that plan. We expect that our member tribes will continue to review and 
actively participate with other tribes in evaluating this draft plan 
and that they will communicate with you further as this draft plan 
moves forward.
    Mr. Chairman, in summary, we believe that the Commission is an 
excellent working model of the Indian Self-Determination Act. Through a 
governing body of leaders from four tribes working together to protect 
their treaty fishing rights and a staff of biologists, hydrologists, 
law enforcement personnel, and other experts advising tribal policy-
makers, this Commission has demonstrated that tribes are able to take 
the lead on natural resource issues, provided that adequate resources 
are available. We are asking for your continued support of our efforts. 
We trust the Subcommittee will take these concerns into account when 
considering the fiscal year 1998 Bureau of Indian Affairs budget. We 
are prepared to provide any additional information you may require in 
analyzing the BIA's budget.
                                 ______
                                 

Prepared Statement of Wm. Ron Allen, Commissioner, U.S. Section of the 
                       Pacific Salmon Commission

    Mr. Chairman, my name is Ron Allen, I am the tribal Commissioner 
representing the United States of America on the Pacific Salmon 
Commission. For the record, I have provided the executive summary of 
the proposed budget prepared by the U.S. Section Budget Committee for 
implementation of the Treaty. It details budgets for Tribal, Federal, 
and State agencies involved in the Treaty. The U.S. Section has 
identified a required funding level of $3,152,046, plus pay cost 
adjustments for fiscal year 1997 and fiscal year 1998, for tribal 
research projects and participation in the United States/Canada Pacific 
Salmon Treaty process for fiscal year 1998. These program 
recommendations have been integrated with those of the state and 
federal agencies so as to avoid duplication of effort and provide for 
the most efficient expenditure of scarce funds. In the BIA's budget in 
past years, these funds have been allocated between Self Governance 
compacts and the United States/Canada Pacific Salmon Treaty line item. 
This year, in a move endorsed by the U.S. Section, the BIA will 
transfer $924,000 from the self governance compacts back to the Salmon 
Treaty account. Please note that this amount falls $134,046 short of 
the amount necessary to fully restore this account. This is due to 
recent cuts in self governance funding. In order to ensure the 
effective implementation of the United States/Canada program, the U.S. 
Section recommends that this committee, in addition to the base 
transfer, restore the additional $134,046 to our base funding, thereby 
funding the United States/Canada account at $3,152,046 in fiscal year 
1998. I would note that, at that amount, you would only be restoring 
this program to its fiscal year 1995 combined funding level.
    The United States and Canada established the Pacific Salmon 
Commission, under the Pacific Salmon Treaty of 1985, for the purposes 
of conserving salmon stocks, providing for the optimum production of 
salmon stocks, and controlling salmon interceptions. While the first 
few years of the Treaty provided tangible benefits for both countries, 
the Commission's work has become increasingly difficult over the last 
few years: the status of some of chinook and coho stocks originating in 
Washington, Oregon, Idaho, and British Columbia continues to grow worse 
while the demands to maintain culturally and economically important 
fisheries increases. The Commission could not meet one of these needs 
without sacrificing the other. While both country's managers agreed 
that conservation needs should be addressed first, we found it 
increasingly difficult--if not impossible--to agree on which fisheries 
should bear the sacrifice necessary carry out that responsibility. In 
the last year, though, we have initiated two important changes: within 
the United States, we have adopted an abundance based approach for 
chinook management; with Canada, we have embarked upon a ``Regional 
Stakeholders Process'' in an attempt to resolve our ongoing debate over 
``Equity'' under the Treaty.
    Until the last two years, the United States watched in frustration 
as Canada ignored our requests for significant harvest reductions in 
Canadian fisheries harvesting U.S. origin coho, and chinook. This 
stance by Canada only increased the pressures on harvest management 
within the U.S. Chinook conservation concerns, particularly for stocks 
originating in Idaho, Oregon, and Washington, finally resulted in a 
lawsuit within the United States in 1995. This lawsuit was the result 
of the United States and Canada's inability to develop a more 
responsive chinook management regime, one that took into account the 
annual fluctuations in the abundance of stocks. The tribes and the 
states of Washington and Oregon, through litigation, enjoined Alaska's 
chinook fishery in 1995, while Canada undertook some chinook harvest 
reductions as well. These actions addressed the chinook conservation 
requirements in the short term, but left many questions unanswered.
    In 1996, the U.S. Section, after lengthy negotiations, adopted an 
internal agreement on how to manage the Southeast Alaska chinook 
fishery, utilizing an abundance based management mechanism. We only 
took this step in the United States after negotiations with Canada did 
not provide us with a coastwide management mechanism. The approach 
adopted by the United States allows for the harvest of chinook to go up 
in Southeast Alaska as the aggregate abundance of stocks increase, but, 
equally important, this approach reduces the allowable harvest as the 
aggregate stock abundance goes down. In this way, the United States 
hopes to be able to more proactively address conservation concerns for 
chinook stocks in U.S. fisheries. But because this effort cannot work 
without Canada's participation, it is our intention to negotiate a 
compatible management regime for Canadian fisheries through the Salmon 
Commission process, using our agreement as a starting point.
    As for Equity, the United States proposed and Canada agreed to use, 
a regional forum to address our continuing debate over how to implement 
this important Treaty principle. Under this approach, we have enlisted 
fishers, the people that know the fisheries and their problems the 
best, to provide us with recommendations on how to resolve the several 
long standing issues in this area. Using one group for Alaskan and 
Northern British Columbia fisheries and another group for Southern 
British Columbia and Fraser River fisheries, the parties have tasked 
these fishers with reviewing past management regimes and asked them to 
come back with innovative solutions. While they will be struggling with 
difficult issues, I believe there is reason to be optimistic about 
solutions coming out of this process.
    Mr. Chairman, considering the explanations I have just provided for 
some of the things you may have heard, the signing of the United 
States/Canada Pacific Salmon Treaty must still be recognized as an 
essential step forward for the conservation and enhancement of the 
truly renewable salmon resource of the Pacific Northwest, Alaska, and 
Canada. Under the Treaty, both countries committed themselves to a 
coastwide rebuilding program for chinook salmon stocks, to the 
conservation of the coho stocks of both countries, and to a harvest 
sharing of Fraser River sockeye and pink salmon stocks in order to 
provide for stable United States and Canadian harvests. Even with the 
difficulties outlined above, the Commission continues to work towards 
those goals. There is no doubt that the resource would be in much worse 
shape today had the Treaty not been in place for the last ten years. 
Prior to this Treaty, fish wars often erupted with one or both 
countries overharvesting fish that were returning to the other country, 
to the detriment of the salmon resource. Now, under the Treaty, we 
share a mutual commitment--if at times a rocky one--with Canada to 
rebuild chinook stocks, to conserve salmon populations coastwide, and 
to insure that each country is receiving the benefits of its salmon 
production.
    Especially in years of difficult negotiations, you should recognize 
that the information provided by the programs becomes even more 
critical from a management perspective. When there is no agreement 
between the United States and Canada, the burden on U.S. resource 
managers of domestic fisheries increase by well more than twofold--
without adequate technical information, they must take much more 
conservative management actions to avoid overfishing the stocks.
    Beyond our budget recommendations, it is important to remember that 
a primary consideration of Pacific Salmon Treaty negotiators was that 
the Treaty would allow for both the United States and Canada to proceed 
with planned enhancement activities. You should recognize that 
additional funding should be provided, as promised at the time the 
Treaty was signed, to carry out these enhancement activities. Within 
the region, we are developing cooperative arrangements to further 
region-wide efforts to rebuild salmon stocks. Continued delay in 
undertaking enhancement activities is placing considerable strain on 
those bearing the burden of conserving the salmon resource--largely 
fishermen coastwide, and all too often the tribal fishermen. 
Enhancement of this resource will provide for a stable, diversified 
economy coastwide. Of course, enhancement under the Treaty means the 
use of both natural and artificial methods and includes restoring the 
spawning habitat of a river, enhancing passage to the spawning and 
rearing areas, and using supplementation to rebuild weak or depressed 
stocks. And again, since they have been developed to rebuild or 
conserve salmon populations, these enhancement activities would also be 
expected to complement and hasten the recovery of salmon stocks listed 
under the Endangered Species Act.
    Finally, you should take into account the fact that the annual 
value of the commercial harvest of salmon subject to the Treaty is 
worth well over $500 million when stocks are at productive levels, 
supporting the infrastructure of many coastal and inland communities. 
The value of the recreational fisheries, and the important economic 
diversity they provide for local economies throughout the Pacific 
Northwest and Alaska, is also immense. And, of course, the value of 
these fish to tribes of Washington, Oregon, and Idaho goes far beyond 
their monetary value and reaches the cultural and religious lives of 
Indian people. Lastly, continued attention--and significant monetary 
investments--is focused on salmon as a result of listings of Pacific 
Northwest salmon populations under the Endangered Species Act. Given 
the resources, we manage a resolution to this complex situation, 
especially if we are allowed to work towards the true intent of the 
Treaty: mutually beneficial enhancement of the shared resource.
    Mr. Chairman, that concludes my written testimony submitted for 
consideration by your Committee. I want to thank the Committee for the 
support that it has given the U.S. Section in the past. Rolland 
Rousseau, Chairman of the U.S. Section Budget Committee, will be able 
to answer any written questions you or Committee members may have 
regarding the U.S. Section of the Pacific Salmon Commission budget.

Summary of tribal program under the United States-Canada Pacific Salmon 
Treaty

        Fiscal years                                           BIA total
1997 actual appropriation...............................  \1\ $3,018,000
1998 recommmendation....................................       3,152,046
Shortfall/restoration...................................         134,046

\1\ This amount is the total of self governance account funds ($924,000) 
and the United States-Canada Pacific Salmon Treaty account ($2,094,000). 
As a result of targeted cuts in funds that were provided under Tribal/
Agency Operations for tribes participating in the Self-Governance 
Compacts, this amount is a reduction in program funding provided by 
Congress in earlier years. In order to carry out the programs endorsed 
by Congress in past years, an additional $134,046 should be restored to 
the United States-Canada Pacific Salmon Treaty.

Prepared Statement of Wm. Ron Allen, Commissioner, U.S. Section of the 
                       Pacific Salmon Commission

    Mr. Chairman, my name is Ron Allen and I am a Commissioner on the 
Pacific Salmon Commission, established by the Treaty between the United 
States and Canada for the purposes of conserving salmon stocks and 
controlling salmon interceptions. I am providing this testimony as a 
member of the U.S. Section Budget Committee. The Committee's staff has 
also been provided with a copy of the recommended budget prepared by 
the U.S. Section for implementation of the Treaty. It details budgets 
for Tribal, Federal, and State agencies involved in the treaty. For the 
U.S. Fish and Wildlife Service, the U.S. Section recommends funding the 
fiscal year 1998 base program for Pacific Salmon Treaty activities at 
$615,000, an increase of $150,000 over the amount provided by Congress 
in fiscal year 1997, providing a necessary add-on to the USF&WS base 
budget for the Regional Mark Center. All of the funds are needed for 
data collection and analysis directly related to the implementation of 
the Treaty and are used in cooperative programs involving Federal, 
State, and Tribal fishery agencies and the Department of Fisheries and 
Oceans in Canada. The monetary commitment of the United States is 
matched by the commitment of the Government of Canada.
    The United States/Canada Pacific Salmon Treaty continues to be 
important to the wise management of the salmon of the Northwest and 
Alaska. The cost to manage this resource is small compared to the value 
of the salmon to the economies of both countries. The value of the 
annual commercial harvest of salmon subject to the Treaty is estimated, 
when stocks are healthy, at over $1 billion, supporting the 
infrastructure of many inland and coastal communities in Southeast 
Alaska, Canada, Washington, Oregon and Idaho. The value of the 
recreational fisheries, and the important economic diversity they 
provide for local economies throughout the Pacific Northwest and 
Alaska, is also immense and in some ways incalculable relative to the 
societal benefits they provide local communities. Recent downturns in 
stock productivity make the USF&WS programs, especially the Regional 
Mark Center, critical to managing currently depressed stocks. And, of 
course, the value of these fish to tribes of Washington, Oregon, and 
Idaho goes far beyond their monetary value and reaches the cultural and 
religious lives of Indian people.
    As part of the U.S. Section's management activities, millions of 
young salmon are marked each year with coded wire tags that allow the 
U.S. Section to evaluate its fishery management decisions. The adult 
salmon that return to the fisheries and spawning areas are sampled and 
the tags are recovered, providing important migratory and catch rate 
information to both researchers and managers. This information 
continues to be the backbone of evaluating the Treaty's programs and 
successes and is also an invaluable tool in gauging the recovery 
programs being evaluated by the Pacific Northwest and Alaska as part of 
the Endangered Species Act process. This critical work is facilitated 
by the Regional Mark Center.
    For fiscal year 1998, we are requesting that the Committee provide 
the Fish and Wildlife Service with a $150,000 add-on to fund the 
Pacific States Marine Fisheries Commission's (PSMFC) Regional Mark 
Center. The Regional Mark Center coordinates the standards of the 
Treaty's comprehensive, long-term activity and acts as the central 
computerized repository for the information on tag releases and 
recoveries. The Fish and Wildlife Service will contract with the PSMFC 
to provide this service. Because of the added concern for salmon stocks 
generated by the Endangered Species Act, this information has become 
even more critical to Alaska and the Pacific Northwest, as well as 
Canada, in order to evaluate fishery management decisions. Because the 
responsibilities of the Regional Mark Center will continue to grow as 
the demand for this information grows, the U.S. Section is recommending 
that $150,000 be added to the Service's base Resource Management 
program funding for this critical Treaty activity.
    Mr. Chairman, that concludes my testimony submitted for 
consideration by your Committee. I want to thank the Committee for the 
support that it has given to the Treaty in the past. I am available to 
answer any questions you or Committee members may have regarding the 
U.S. Section of the Pacific Salmon Commission budget.

   SUMMARY OF U.S. FISH AND WILDLIFE SERVICE PROGRAM NEEDS FOR UNITED   
                   STATES-CANADA PACIFIC SALMON TREATY                  
------------------------------------------------------------------------
                                      Fiscal years--                    
                             -------------------------------            
                                   1997           1998        Shortfall 
                              appropriation  recommendation             
------------------------------------------------------------------------
Fisheries (staff and tagging                                            
 activities)................      $465,000        $465,000   ...........
Pacific States Marine                                                   
 Fisheries Commission.......  .............        150,000      $150,000
                             -------------------------------------------
      Total.................       465,000         615,000       150,000
------------------------------------------------------------------------

                                 ______
                                 

  Prepared Statement of Joyce Burr, Superintendent, Circle of Nations 
                                 School

    Honorable Senators: My name is Joyce Burr I am the superintendent 
of Circle of Nations School, an off-reservation boarding school 
operating under a contract from the BIA to the Sisseton-Wahpeton Sioux 
tribal governing body under Public Law 100-297. The 6-member school 
board represents tribes with the largest enrollment of students, from 
the states of North Dakota, South Dakota, Minnesota, Montana, 
Wisconsin, and Nebraska.
    The Circle of Nations School is located on a 53-acre campus in 
Wahpeton, ND. It has 3 dormitories, 1 instructional building, and 10 
other buildings. The program was established by Congress in 1904 as an 
agricultural and vocational training school administered by the BIA. It 
changed to a more conventional academic focus by the 1940's. Day 
schools had been established on reservations following the 1928 Merriam 
Report, which spurred national reform in Indian education.
    By the 1970's, the remaining boarding school system was home to a 
troubled student population who did not fit with schools at their home 
agencies.The concept of a therapeutic school began to be discussed 
among Indian health and education leaders. Several papers from 1973 to 
1988 document needs of the off-reservation boarding schools and the 
recommendations of BIA, Indian Health Service, and Indian school 
organizations toward a therapeutic model.
    In 1993 the school converted to tribal grant status. That year, a 
Therapeutic community School Model Meeting had been held in Washington, 
DC whereby Indian Health Service, BIA, mental health experts, and 
boarding school officials conceived a plan to implement the model in 4 
schools, including Wahpeton. This was hailed as ``an historic meeting, 
a collaborative effort between the Bureau of Indian Affairs and Indian 
Health service'' and ``a cooperative endeavor in more than name only.'' 
Again the mental health needs of students were emphasized, as were 
staffing and funding improvements.
    Indian Health Service stated that an ``underfunded, understaffed 
model should not be attempted.'' The off-reservation boarding schools 
(ORBS) asserted that the Indian School Equalization Program (ISEP) 
formula could not even marginally meet the high needs of students with 
chronic substance abuse, mental health, behavior and learning problems. 
Concept papers from the ORBS recommended changing the ISEP formula. To 
date this has not happened, and the boarding schools continue to 
struggle with a seemingly impossible proposition: to provide--on a 
shoestring budget--a total program for each child, where various other 
agencies and resources have failed or been exhausted. For years, the 
boarding schools had the image of a ``last resort'' ``dumping ground'' 
``warehouse'' and ``escape hatch'' for troubled and disadvantaged 
Indian youth.
    These children were abandoned by parents, schools, professional 
service providers, and the juvenile justice system without a second 
thought. They came from psychiatric wards, detention centers, abusive 
homes or no home, and other problematic circumstances with no 
documentation or resources for their care while at school. Yet there 
has never been a suicide or a drug or alcohol-related death of any 
student at the Wahpeton Indian boarding school--even though a dozen 
such incidents have occurred in the school-age population of the 
surrounding small community in as many recent years.
    As a result of the numerous studies and adverse publicity regarding 
boarding schools, the Circle of Nations (Wahpeton Indian School) was 
designated a therapeutic model demonstration project under Public Law 
103-382, Improving America's Schools Act of 1994. A one-year funding 
award allowed for a reduced enrollment of 150 students in 1994, as 
compared to nearly 300 the previous fall, in order to lower the 
student-to-staff ratio.
    The school is charged with the responsibility of providing a 
program, based on an annual written plan, that ``links clinicians, 
counselors, and mental health professionals with academic program 
personnel in a culturally sensitive residential program tailored to the 
particular needs of Indian students.''
    The school operates a 24-hour-a-day, 7-days-a-week, 9-month 
therapeutic residential school program. We currently enroll 200 
children in grades 4 through 8 from around 33 tribal groups and 18 
different states. Our largest student enrollment are from the Aberdeen, 
Bemidji, and Billings Indian Health Service regional areas. However, 
the school does not receive Indian Health Service support other than 
technical assistance and the school clinic program which employs a 
nurse and intermittent nurse assistance.
    Last year's budget for the school clinic was $185,016 ($101,316 
from Hospitals & Clinics program and $83,700 for Contract Health 
Service funds). With 200 students, that works out to $925 per student 
for the 252 days per school year that a student is on campus, or $3.00 
per day. If a student requires emergency psychiatric placement, their 
entire yearly allotment will buy 1.5 days or one-half of a standard 72-
hour emergency inpatient assessment. Longer-term mental health or 
chemical dependency treatment is the usual recommendation for these 
students, although funds can rarely be accessed.
    Circle of Nations revised its admission requirements to include a 
psychological evaluation, chemical dependency assessment, court report, 
and social history for each students' application. This eliminated some 
costs and provided a planning document for each student. The majority 
of students have multiple health risk factors--environmental, 
biological, and behavioral. Typically, students have a history of low 
academic or personal achievement and have learning impairments.
    Most of our students can be diagnosed with more than on co-existing 
mental health, substance abuse, or learning disorder. 75 percent are 
eligible for Special Education services in either Emotionally Disturbed 
(80 percent) or Learning Disabled (20 percent) diagnostic categories. 
At least 90 percent meet diagnostic criteria for Conduct Disordered. 75 
percent report a history of physical, sexual, or psychological abuse. 
25 percent or more have family-reported risk factors for prenatal 
alcohol or other drug exposure known to cause birth defects such as 
Fetal Alcohol Syndrome of Effect. Traumatic brain injury is a 
significant factor as well.
    The goals of the Circle of Nations therapeutic model are: 1. 
Successful transition through levels of learning; 2. Health promotion/
disease prevention; 3 Mental health promotion; and 4. Promote 
spiritual, cultural, social, and emotional development.
    We can provide a comprehensive residential education program that 
includes housing, nutrition, special education, school health services, 
recreation, cultural, and leisure activities, and a network of 
referral. We use all available resources for the prevention and early 
intervention/remediation of health and learning problems, including 
mental health and substance abuse disorders. Students may be referred 
elsewhere if their problems turn out to be beyond the scope of our 
services, for example, psychiatric emergencies and longer-term 
inpatient recommendations. There are no clinical mental health 
providers on staff, such as a psychologist, psychiatric nurse, etc. 
although we can contract limited assessment services from providers 
(not treatment).
    The therapeutic residential school is conceived of as a cost-
effective approach which aims to prevent or ameliorate lifetime 
problems, the costs of which are already being obligated to different 
agencies, programs, or resources. The total cost per student is 
currently $50 per day at Circle of Nations School, compared to $125 for 
youth detention, $480 for inpatient substance abuse treatment, or $650 
for inpatient psychiatric care. The overall federal average cost of 
housing an adult prison inmate presently exceeds $21,350 per year. A 
year's stay in the state hospital or regional treatment center is far 
more costly.
    Experts on the treatment of conduct-disordered children agree that 
developing a ``system of care'' that is designed to improve the child's 
ability to function in all areas of his or her life--at home, in school 
and in the community is the best approach, rather than short-term 
treatment or counseling. Circle of Nations is a structured system of 
care for children who do not have an adequate system elsewhere.
    The idea is to help these children change their emotional and 
belief system before it solidifies and is entrenched in their lives (a 
childhood history of conduct disorder is a diagnostic requirement of 
adult antisocial personality disorder). Circle of Nations School 
promotes normal socialization, skills acquisition, and remediation 
modalities in the least restrictive environment possible. The 
therapeutic community approach teaches personal and social 
responsibility and allows the student to practice adaptive coping 
skills.
    Circle of Nations is not a locked facility as are the state 
corrections school and other inpatient or residential programs where 
youth are physically contained, requiring fewer staff to operate. In 
comparison, the students at Circle of Nations School require constant 
staff supervision, a higher staff effort, and a higher staff to student 
ratio.
    When our students are assessed by expert providers and clinicians, 
they have over and over again recommended long term inpatient therapy, 
group or foster home placement, specialized learning and behavior 
programs, and dual track mental health/substance abuse treatment. But 
there is no such placement available to our students--Circle of Nations 
School is the closest thing to this ideal although it is not yet a 
truly therapeutic model.
    During the 1996-97 the Behavioral Center Pilot Project was 
implemented on a small scale at Circle of Nations School. This is a 
structured 24-hour care program for high-risk students such as dual 
disordered, chronic substance abusing, and assaultive kids. It serves 
up to 10 children at a time with an individual Master Treatment Plan. 
The team treatment approach utilizes the participation of clinical 
mental health providers, licensed addiction counselors and social 
workers, counseling and psychological support staff, and residential 
and child protection staff.
    The majority of kids go through the behavior modification and 
counseling program and are then mainstreamed into the general 
population again instead of being suspended or expelled. Some are 
placed in longer-term psychiatric or CD treatment programs directly 
from the Behavioral Center and are able to return school upon 
successful completion of these off-campus programs. This project is 
successful in that only 2 of 24 students were dropped from Circle of 
Nations School after leaving the Behavioral Center. Both were placed 
directly into longer-term psychiatric treatment through CNS referral 
work.
    While this program is effective for the children it serves, it does 
strain our staff resources that are needed by the rest of the student 
population. If a clinical program director and mental health providers 
and workers could be hired to operate the Behavioral Center and 
generate third-party billings, this program could serve many more 
students and become self-sufficient in 3-5 years. What Circle of 
Nations School proposes to do is to further develop and staff the 
Behavioral Center whereby students can be served by a three-phase 
onsite therapy program, eliminating the cost of outside provider 
contracts and emergency facilities and improving student performance 
and retention.
    The on-campus Behavioral Center is our priority task in carrying 
out the therapeutic residential school mission. We are requesting $1.7 
million to implement this project. A complete proposal and budget are 
available for review.
    Lives are being wasted every day in this country. Students drop out 
and leave school without learning the crucial things for their success. 
The boarding schools are a microcosm of reservation and urban society 
today with all its ills. It's time to quit the Band-Aid approach. 
Inadequate funding, understaffing, outdated programs, restrictive 
policies, and lack of coordination between agencies have characterized 
Indian boarding schools for the past 25 years. We must move decisively, 
for these children are our future.
                                 ______
                                 

 Prepared Statement of Stanley Herrera, President, Alamo-Navajo School 
                            Board, Alamo, NM

    Mr. Chairman: I am Stanley Herrera, President of the Alamo-Navajo 
School Board. With me today is Burton Apache, a Member of the School 
Board. We ofer testimony on the School Operations budget submitted by 
the Bureau of Indian Affairs, and on certain aspects of the fiscal year 
1998 Indian Health Service budget.
    First, let me point out that the Alamo School Board does more than 
operate a school. Since our 10-square mile reservation is in an 
isolated area of south/central New Mexico, far away from the ``big'' 
Navajo Reservation, the Alamo-Navajo Community has had to learn and 
practice self-sufficiency on a daily basis. Through the authorization 
of the Navajo Nation Council and the Alamo Chapter (a political 
subdivision of the Navajo Nation), the School Board has become the 
central service organization for all education, health, roads 
maintenance and community programs serving the 1,800 residents of the 
Alamo reservation.
              bureau of indian affairs--school operations
    Each year Congress provides us with funds under the Indian School 
Equalization Formula (ISEF) to pay the costs of our instructional 
program. But you should know that we are not able to devote these ISEF 
monies solely to our instruction needs. The chronic shortages in the 
other accounts that must support our school operations force us to use 
our precious ISEF dollars to make up those shortages. For example:
    Our student transportation (daily round-trip to/from homes) costs 
$180,000 annually. We are reimbursed for only $136,600, or only 70 
percent of the costs. Thus, we have to make up the $43,400 difference 
from our ISEF instructional funds.
    GSA will increase the bus lease rates next year, but there is no 
additional funding in the budget request to cover these costs. Thus, 
the percentage of our transportation costs for leasing will increase 
from 40 percent of our budget to perhaps 60 percent. But we cannot pay 
lower wages than we already pay our bus drivers. Thus, this additional 
shortfall will take even more of our ISEF dollars.
    The facilities operation & maintenance funding has never been able 
to meet the Congressionally-ordered formula. Currently, we are falling 
34 percent short of the formula, and this shortage will be even greater 
under the proposed fiscal year 1998 budget. The BIA acknowledged that 
over 750,000 square feet of facilities space were added to the system, 
but they do not request the additional $3 million needed to cover this. 
Thus, all schools will suffer an even greater reduction in the funds 
provided for facilities maintenance.
    What does this mean for Alamo? Since we have to pay in full our 
utility costs, must perform preventive maintenance and cover emergency 
repairs, we have little money left for custodial expenses. What does 
this mean for the federal facilities we operate? They will deteriorate 
at a far faster rate.
    Where do we look to make up the shortage? ISEF, again.
    When the Administrative Cost Grant funding is not enough to pay all 
schools at the rate required by law, we institute severe cost reduction 
efforts. But there is a level below which we cannot drop without 
compromising sound management principles. When this happens, we again 
must make up the shortage with ISEF dollars.
    We fear there could be a significant shortage in the A.C. Grant 
request for fiscal year 1998, as some 12 schools currently operated by 
BIA will be converted to tribal operation. This makes these schools 
eligible for AC Grant funds. We know BIA has not asked for enough 
additional funds to cover these conversions. This means all schools 
will suffer sizable reductions in their A.C. Grants.
    A note about severance pay: We ask you to make sure that BIA does 
not use any of the funds you appropriate for School Operations to pay 
federal employee severance costs at the converting schools. Such use is 
not authorized in the law. Severance costs should be funded from the 
BIA's contract support line item, and we ask you to assure that 
sufficient funds are provided there for this purpose.
                          bia--fire protection
    Three years ago, a lot of media attention was focused on the lack 
of fire protection at BIA-funded schools on the Navajo Reservation. 
Immediately afterward, the then Director of the Office of Indian 
Education Programs authorized schools to use facilities operation & 
maintenance funds for fire services. We have received some minor 
equipment (such as fire suits) and some training for volunteer firemen. 
But we received no additional funding for fire services and no really 
significant improvements in fire protection since then.
    As a result Alamo still has only one fire truck--a 25-year-old 
vehicle that carries 500 gallons of water. This is the sole fire 
fighting capability we have on a reservation that is the size of the 
District of Columbia. With this one vehicle, we have to protect $25 
million of federal facilities and the homes of 1,800 reservation 
residents.
                         indian health service
    We could spend hours reciting various funding problems with the IHS 
clinic the School Board operates, but we will focus on only one of them 
here: environmental health systems such as water, sewer and solid waste 
disposal.
    IHS funds new environmental health systems development on a limited 
basis for new federal facilities (such as our recently-expanded clinic) 
and tribal housing programs. But, when completed, IHS turns the utility 
systems over to the local tribal governmental authority and provides 
neither upkeep nor replacement costs.
    In a number of New Mexico tribal settings, the existing 
environmental health infrastructures are old, inadequate and badly 
deteriorated. Some provision must be made for replacement and 
maintenance, as we do not have the funding base at the local level to 
support this needed activity.
    I wish I could close on a hopeful note, but I cannot. The recent 
Welfare Reform Law will put additional pressure on our existing 
inadequate health, education, and community programs and facilities. 
Many Indian people who now live off-reservation will be forced to 
return to their reservations when they are cut off from the social 
support programs previously funded by federal program dollars. When 
this happens, how will we be able to manage this added responsibility?
                                 ______
                                 

  Prepared Statement of George Cukro, Executive Director, Black Mesa 
               Community and School of the Navajo Nation

    The Black Mesa Community School is a K-8 Grant School located on 
the Navajo Nation Reservation in northern Arizona. We are a rural 
Native American community within the Black Mesa Mountains, on unpaved 
route 8066. The nearest post office is in Pinon, Arizona, 25 miles 
south of Black Mesa.
    We appreciate the opportunity to submit our statement on the 
proposed fiscal year 1998 Bureau of Indian Affairs budget. Our 
statement focuses on Navajo children, their education, and the 
facilities that are needed for them to obtain the rich resources that 
are available in ways that most take for granted. In summary those 
needs are: adequate teaching facilities and a safe road to the school; 
a dependable, efficient telephone system; capability to access the 
internet and on-line computer services; adequate, safe housing for 
instructional staff.
    The Black Mesa Community School opened in 1976 in used trailers 
converted into small classrooms. Later, the Bureau of Indian Affairs 
constructed a small school building consisting of four instruction 
classrooms, a library/conference room combination, an all-purpose room 
with an attached kitchen, a small office unit, and 2 student restrooms. 
The school was built to house 80 students but we have grown to more 
than 100 children. Since 1991, our student population has been 
consistently averaging 100 students, as follows:

Number of students

1991..............................................................   100
1992..............................................................    92
1993..............................................................   112
1994..............................................................    98
1995..............................................................   105
1996..............................................................   105

    The needs of Black Mesa's children are not any different than kids 
who live in large metropolitan areas. We are, however, restricted in 
meeting those needs due to our isolation, lack of outside resources, 
limited housing, and no phone lines.
                              overcrowding
    We have applied for grants to build additional modular classroom 
buildings to help meet the children's needs, but to date we have not 
even received acknowledgment that they were being considered. To serve 
an ever increasing student population, we have had to combine several 
grade levels into single classrooms. This limits our capacity to 
provide a well-rounded curriculum for our children such as shop, home 
economics and arts. Clearly, these are classes that most children take 
for granted throughout America. In order to adequately provide for our 
students, we need:
  --Two additional classrooms to reduce the pupil/teacher ratio in 
        classes that are currently combined across grades because of 
        our limited facilities.
  --Two classrooms for pre-vocational training for our middle school 
        students. One room would be used for a wood working shop, as 
        well as for cultural arts. The second room would be used for 
        home economics, including cooking, sewing, home management and 
        life skills.
  --One computer lab for technological training and internet access.
  --One classroom for advanced instruction for gifted and talented 
        students.
                              unsafe road
    At present, the unpaved road limits access to Black Mesa School. If 
there is an emergency, help is a long time coming. It is often 
dangerous for buses and parents to navigate 12 inch ruts, mud, snow, 
and ice. Consultants who come to our school for staff development would 
rather pay the expense of renting a car than pay the repair bills for 
replacing tires, shocks, windshields, motor mounts and wheel bearings. 
Believe me when I tell you that I am not exaggerating.
    For the health and safety of our people, especially the children, 
we need funds to lay gravel on the unpaved road and maintain a 
consistent repair schedule throughout the year.
                          technological needs
    The utilization of modern technology is the only way possible to 
provide for the health and educational needs that will offer Navajo 
children the opportunities enjoyed by other children in this country. 
We at Black Mesa have committed to the use of technology in linking our 
local educational standards to the national, state, and Bureau of 
Indian Affairs standards.
    We need your help in obtaining for our school a modern 
communication system. Black Mesa School has the only available 
telephone for the people in a 25-mile radius. This phone is operated by 
radio waves and is very unreliable. There are days when the phone goes 
out for hours at a time. If we ever had an emergency during one of 
those blackout times someone might lose their life. A dedicated phone 
line would not only provide a more reliable communication system for 
the health and safety of the Black Mesa community, but we could also be 
linked to the rest of the world technologically. Most Americans now 
have the world at their fingertips, but Navajo children at Black Mesa 
struggle to utilize the 10 computers we were able to purchase.
    With a dedicated phone line, our students, too, will be able to 
access database services including the internet and on-line computer 
services which can provide a rich learning experience for our children. 
We have committed ourselves to use technology to provide our children 
with modern opportunities. We are already moving in that direction, but 
we cannot accomplish this goal without your help.
                             staff housing
    The housing for the teachers of Black Mesa School is woefully 
inadequate. Staff are currently housed in four trailers which are 10 
years old, and 5 houses which are approximately 30 years old. Due to 
the age of these units, they are in need of refurbishing, replacement 
of appliances and have little or no heat during the freezing winter 
months. We ask you to re-establish a recurring education quarters 
construction budget in order that we can provide decent, safe and 
affordable housing for our staff.
    On behalf of the Navajo people living at Black Mesa, we thank the 
Subcommittee for the opportunity to comment on matters which may seem 
simple and of little consequence, but they are of monumental concern to 
us. We are isolated, but we hope that you will assist us in obtaining 
the essentials of life that are taken for granted by other Americans. 
President Clinton has stated he was committed to excellence and 
technology for all American children. I believe all of you in Congress 
would agree that all of America's children should be well-educated for 
the twenty-first century. Please do not leave the children of Black 
Mesa behind. Thank you for your support.
                                 ______
                                 

  Prepared Statement of Faye Blue Eyes, Executive Director, Shiprock 
         Alternative Schools, Inc., Navajo Nation, Shiprock, NM

    Shiprock Alternative Schools, Inc. (SASI) administers an 
alternative education program for 159 high school students, and an 
elementary education program for 180 students from Kindergarten through 
Sixth grade. SASI is unique in its concept of a holistic learning 
environment conducive to the highest level of learning for our diverse 
elementary and high school students. For 20 years we have successfully 
managed our alternative and elementary programs under a Public Law 93-
638 contract. We are now in our seventh year of successful Public Law 
100-297 Grant administration and maintain a Staff Quarters Program of 
ten units, serving Shiprock Alternative Schools, Inc.
    So that SASI may continue its successful ``alternative'' high 
school and elementary programs, we respectfully ask this Subcommittee 
to fund at least two projects per year on the New School Construction 
Priority List. We were very disappointed that the BIA only requested 
funding for one new school construction project in the fiscal year 1998 
budget. Our facilities are in desperate need of replacement and your 
commitment to funding at least two priority list projects per year will 
ensure that Shiprock's replacement school can receive funding within 
the next three years.
                    sasi's ``alternative'' programs
    Our high school and elementary programs are ``alternative'' because 
they offer non-traditional education programs. The fundamental 
philosophy of SASI is based on Dine', and other American Indian 
philosophies of life, and incorporates the positive attributes for the 
well being of our native People. The innovative high school program was 
established by the Navajo Nation in 1976 to serve ``at risk'' Navajo 
high school youth experiencing social and academic problems in the 
conventional education program. We are the school of last resort for 
students who have previously dropped out of school, have become 
pregnant and need child care in order to continue studies, or have had 
disciplinary problems at previous schools. Our ``alternative'' high 
school program provides a second chance--perhaps the only chance--for 
those youth that are most likely to be lost to society.
    The elementary program is based on the principles of early 
intervention and prevention. The program focuses on the academic and 
social needs of the individual students, blending conventional and 
traditional educational methods. Accordingly, the class sizes are 
intentionally kept small to encourage substantial teacher-student 
interaction and individual attention. A few years ago, BIA approved our 
request to advance one grade per year, with the ultimate goal of 
providing grades K through 8. To do this, however, we have to reduce by 
one kindergarten class each year in order to have the space to provide 
the new grade level. The program has been such a success that, since 
its inception, we have not been able to accommodate all students 
wishing to participate. This year, for instance, 37 students are on our 
waiting list.
                        new school construction
    In January, 1993, SASI was added as the 12th school on the New 
School Construction Priority List and we are currently undertaking the 
planning and design phases that precede construction. Facilities 
replacement is the only option for the schools on the priority list 
because their facilities are in such dreadful conditions that 
rehabilitation and upgrading are not feasible. Below is a sampling of 
the conditions faced by SASI that caused it to be placed on the 
priority list, and a glimpse at how these conditions and our current 
space inadequacies have caused us to configure some of our classes.
    SASI's buildings are nearly 50 year-old dormitories whose non 
supportive interior walls have been knocked out in order to create 
classroom space. As a result, numerous fire code violations exist. 
According to a 1988 facility code compliance survey and BIA inspection 
validation by architects and engineers, the ``buildings were originally 
designed as dormitories and are not safe or suitable for use as 
educational occupancies.'' The report identified code/safety items 
requiring immediate attention including inadequate egress from the 
classrooms; flame spread rating of finishes in the corridors; fire-
rated separation between boiler room; and updating of the fire/smoke 
alarm system in the buildings. For instance, the classrooms do not have 
direct exits to the outside or rescue and ventilation windows. Most of 
our doors do not meet fire code standards. SASI has only an audio fire 
alarm system. Safety codes require an audio-visual and communication 
system. Only one of our three buildings has a working sprinkler system 
and even that is not up to code standards.
    The building interiors are not handicapped accessible. No doorways, 
bathrooms, or water fountains were built for or have been modified to 
accommodate the handicapped students, particularly those in 
wheelchairs.
    The heating system is in complete disarray. For example, our boiler 
creates such uneven heating that our children at one end of a building 
must wear gloves and coats, while staff and students at the other end 
open windows to cool off their classrooms. In addition, because the 
boilers are inadequate to handle heating each of the entire buildings, 
they shutdown frequently from the overload, causing our children to go 
without heat at all. The cast-iron radiators in the building where our 
classrooms are located take up some of the much needed space.
    None of the buildings have rain gutters. Rain often accumulates 
around the breezeway areas, sometimes up to a foot. The students cannot 
avoid tracking water and mud into the school which creates dangerous 
slipping and falling. Roof shingles are loose or missing in patches, 
causing leaks that make the problem worse. Some leaking even occurs in 
the main line electrical area.
    One of the most egregious conditions that we and our students must 
face is the presence of asbestos underneath all our school buildings 
and in some walls. No Facilities Management personnel are available to 
check for asbestos fragmentation or undertake removal. This also 
prevents repair work on electrical and water lines. The water in all 
buildings is rusted, so bottled drinking water must be brought in. The 
hot water is orange in color, rendering it useless.
    Despite all of the foregoing inadequacies, which are not unique 
among Indian educational facilities, our ``alternative'' programs are 
so successful that we have a substantial waiting list for both the high 
school and elementary. We are making a difference in the lives of the 
young people that attend our programs. Nevertheless, for us to continue 
this success, we must have a facility that will not place our students 
in constant danger, but, instead, will nurture their educational 
experiences.
    Shiprock Alternative Schools, Inc. has, for the past 20 years, been 
forced to operate in outdated and unsafe school buildings. 
Unfortunately, similar dilapidated school facilities exist throughout 
Indian Country which must be renovated or replaced. We were thus 
disappointed to see that the BIA request for fiscal year 1998 only 
seeks funding for construction of the Many Farms High School 
Replacement, a school ahead of SASI on the priority list. Education for 
our children is fundamental for self-sufficiency; therefore we strongly 
urge Congress to increase funding for Education Construction within the 
Department of Interior Appropriations. We hope that Congress will 
provide not only the money for construction of the Many Farms High 
School, but also money for at least one other school on the priority 
list, so that our need will eventually be met.
    We ask that Members of the Subcommittee imagine one of your young 
loved ones attending a school in the same condition of our current 
facility. If you could provide this loved one a newer, safer school 
environment, would you not do so? Accordingly, we strongly urge you to 
take the steps necessary to fund at least two New School Construction 
Projects per year.
                                 ______
                                 

    Prepared Statement of Hon. Jack Booth, Mayor, Metlakatla Indian 
                               Community

    The Metlakatla Indian Community, Annette Island Reserve, provides 
this statement on the fiscal year 1998 budget requests for the Bureau 
of Indian Affairs and the Indian Health Service. The Council is the 
federally-recognized governing body of Metlakatla Indian Community, 
Annette Island Reserve, the only existing statutory Indian reservation 
in Alaska. The Community population is over 1,500 and has a land base 
of 87,000 acres in southeast Alaska. The economic base of the community 
is based on timber and fishing industries, which provide seasonal 
employment. The Community administers BIA and IHS programs on the 
reservation under contracts pursuant to the Indian Self-Determination 
and Education Assistance Act.
                       summary of recommendations
  --Special allocation for Walden Point Road project
  --Increase funding for Tribal Priorities Allocation account
  --Funding for construction of Metlakatla clinic
                      bia fiscal year 1998 budget
    The Community's concerns and comments specific to the Bureau of 
Indian Affairs budget are as follows.
    Walden Point road project.--Since 1995, the Metlakatla Community 
has been actively pursuing the construction of a 13 mile road and three 
mile shuttle ferry connection which will provide, for the first time, a 
safe, affordable means by which our people can access services and 
business opportunities in Ketchikan. Presently, our transportation 
links off the Annette Islands Reserve are either a commercial air 
transportation service or the Alaska Marine Highway System ferry 
service. The air service is not only expensive but subject to/limited 
by the weather and daylight. The ferry service makes one or two stops 
per week most of the year, with more stops scheduled during the summer 
months.
    We are proud to report that we are in the final stages of 
negotiating a Memorandum of Agreement with the Department of Defense 
(who will do the actual construction under the DOD's Civil-Military 
Innovative Readiness Training Program), Federal Highway Administration 
(the project designer), Alaska Department of Transportation and Public 
Facilities (charged with addressing the environmental and permitting 
requirements) and the Bureau of Indian Affairs (lead agency for the 
environmental process). Other cooperating agencies include the Corps of 
Engineers and the Environmental Protection Agency.
    While much of the costs for this project is being assumed by non-
Interior agencies, the DOD is prohibited from purchasing the 
construction materials, which is estimated to reach $10 million for the 
entire project. We have sought alternative sources to fund the 
materials component, including the Bureau--who advised us to seek a 
specified appropriation of $2 million per year for the five-year period 
the project is expected to be completed. We have been informed that the 
necessary funding should come from either the State of Alaska or the 
Bureau. Both of these entities, however, have already stated that they 
do not have $2 million available to transfer to this project from the 
funding they receive under the Federal Highway Trust Fund. Pending 
finalization of the MOU, all participants are ready to initiate the 
processes which will lead to the actual construction phase beginning 
May 1998.
    Recommendation: We urge that Congress authorize a line item within 
the fiscal year 1998 Bureau of Indian Affairs budget in the amount of 
$2 million for the Walden Point Road Project construction materials.
    Tribal priority allocation.--The Metlakatla Community is encouraged 
by the Administration's request for a general increase of $46.7 million 
to the Tribal Priorities Allocation (``TPA'') account. Within the TPA 
allocation are Wildlife and Parks funds which the Community utilizes 
for fisheries enforcement activities. The present level of funding has 
limited us to just one enforcement officer. The fisheries industry, 
however, has developed into a major economic development and employment 
source for the Community. With the sea cucumber and sea urchin 
fisheries coming on line, our enforcement activities have increased as 
there are now overlapping seasons, an increased number of vessels in 
the waterways, and an expanded area to be covered. You can see that one 
person cannot adequately patrol and enforce compliance with the codes 
that the Metlakatla have established for the fisheries.
    With each fiscal year, more and more inadequately funded programs 
are being transferred to TPA. Additionally, tribes are expected to 
adjust their TPA funds to cover any shortfalls in these programs, 
including Contract Support. Without a significant increase in the TPA 
allocation, the Community will not be able to adequately protect its 
resources in the waterways surrounding the 87,000 acre island occupied 
by the Metlakatla.
    Recommendation: The Community requests that Congress provide, at a 
minimum, the $46.7 million general increase to the Tribal Priority 
Allocations account.
                      ihs fiscal year 1998 budget
    Metlakatla health center.--The Metlakatla Indian Community has been 
pursuing for several years funds for the replacement of the current 
facilities. At present, our clinic services are housed in four modular 
buildings built in the mid-1970's. These facilities are set on pilings 
and connected by open, elevated, wooden walkways. Over time these 
buildings have settled unevenly, posing an unsafe environment for those 
seeking health services (about 28,000 visits per year) as well as 
staff. In addition, we face overcrowding and utility systems which are 
inadequate to support the modernization or updating of medical 
equipment.
    The Community's program justification document (PJD) for 
construction of a replacement health center was approved by IHS and 
included in the IHS Health Care Facilities Construction priority list 
for design and construction funding in fiscal year 1997. According to 
the fiscal year 1997 projections, we were to receive project design 
funds (estimated at $1.3 million in 1995) in fiscal year 1999 (January, 
1998) and the design phase would be completed in late 1999. We were 
disappointed to see in the fiscal year 1998 budget justification that 
the IHS projections now show we will not receive a design award until 
2001 (fiscal year 2002) even though our priority ranking at number 8 
has not changed.
    Please understand, the Community is in desperate need of this 
facility now! We recently received from IHS the report on a 
comprehensive inspection of our current facilities. The total cost for 
repairs necessary to achieve compliance with current fire, mechanical, 
electrical and life-safety codes, as well as the Uniform Building Code 
and the Americans with Disabilities Act guidelines is almost $1 million 
dollars--almost the same amount needed to complete the project design. 
As this Subcommittee is well aware, the IHS Maintenance and Improvement 
funds has never been adequate to address the level of need. The budget 
justification states that in the first quarter of fiscal year 1996, the 
IHS Backlog of Essential Maintenance and Repair was estimated to be 
$188 million. Yet the Administration's request for this account is the 
same as the fiscal year 1997 appropriation ($39.3 million). This is in 
spite of the fact that the agency expects the need to increase as a 
result of ``the addition of numerous tribal facilities, new seismic and 
security requirements, and environmental projects generated by the on-
going environmental assessment program, * * * .'' (page IHF-12).
    We realize it will be virtually impossible to obtain adequate 
funding through the Maintenance and Improvement account to address the 
life-safety and other code deficiencies cited at our existing facility 
if funding remains at the totally inadequate level proposed. We also 
fear that without a significant increase to the Health Care Facilities 
Construction account, we will be no closer than we are this year to 
obtaining project design funds.
    Recommendation: We urge that Congress fund the IHS Facilities 
Construction account at a level which would fund the projects on the 
IHS Construction priority list, providing for the Metlakatla project in 
fiscal year 1998 at least the funds estimated by IHS to complete the 
design of the project ($1.3 million). We also recommend that Congress 
provide a general increase for Maintenance and Improvement to address a 
greater percentage of the backlog.
    Indian Self Determination Fund (Contract Support Costs).--We note 
that the $12 million requested for contract support costs on new or 
expanded health programs operated by tribes under the Indian Self-
Determination Act leaves a $39 million deficit in the Indian Self 
Determination Fund, including $107,588 to cover the overhead costs of 
our ``638'' health program based on it's fiscal year 1997 expansion. 
When IHS funds are not provided for a new and expanded IHS contracts 
and compacts, funds intended for health services are reduced by the 
need to cover overhead costs. We urge Congress to fund the full amount 
of ISDF need identified by the Indian Health Service.
    On behalf of the Metlakatla Indian Community, thank you for the 
opportunity to provide our views on the Indian Health Service and 
Bureau of Indian Affairs budgets for fiscal year 1998.
                                 ______
                                 

 Prepared Statement of Nicolas J. Padilla, on Behalf of the Susanville 
                            Indian Rancheria

    The Susanville Indian Rancheria (Rancheria) provides this statement 
on the fiscal year 1998 budget request for the Indian Health Service. 
The Rancheria provides health care to more than 2,500 American Indian 
beneficiaries located in Lassen County in Northern California. Since 
1986, when the Rancheria first began contracting with the Indian Health 
Service (IHS) under Title I of the Indian Self-Determination and 
Education Assistance Act, we have continuously improved the quality, 
quantity and scope of health care services delivered to eligible 
American Indians located in our service area. The increasing level of 
health services that we have been able to provide through our Lassen 
Indian Health Center is directly related to the amount of funds which 
Congress makes available for Title I contractors through the IHS.
    The Susanville Indian Rancheria's specific concerns with regard to 
the fiscal year 1998 budget request for the Indian Health Service are 
as follows: Institute policy to ensure full funding for calendar year 
contractors out of existing year appropriations; fully fund Contract 
Support Costs; provide $1.4 million for Regional Youth Treatment 
Facility in northern California; correct inequitable funding and 
increase Contract Health Services to California tribes and tribal 
organizations; increase Equipment funding; provide requested $28.3 
million for Health Professions account, including IHS Scholarship 
funds.
    We also request the Committee's assistance in the following issues 
which are not related to the fiscal year 1998 budget, but which impact 
our ability to provide health care services to our people: Adopt 
clarifying language regarding Federal Tort Claims Act coverage for 
tribes and tribal organizations; impact of Managed Care on tribally 
operated health programs; support transfer of certain Sierra Army Depot 
facilities and lands to the Rancheria.
    Full funding for calendar year contractors.--For a number of years 
Susanville Indian Rancheria (``Rancheria'') has utilized a calendar 
year for contracting under Section 105(d) of the Indian Self-
Determination and Education Assistance Act (the Act), rather than the 
fiscal year. The advantages of being a calendar year contractor are 
significant: it provides the Rancheria with a stable funding base for 
its health programs and permits the Rancheria to generate additional 
funds in the form of interest. Historically the Rancheria's calendar 
year contract has been funded with funds entirely from the fiscal year 
in which the contract begins, although the calendar year contract 
period extends three months beyond the end of the fiscal year.
    In calendar year 1998 the IHS has implemented policies which 
violate the intent of Congress when it enacted Section 105(d). The 
Agency has taken funds appropriated in fiscal year 1997 for the 
Rancheria's calendar year 1998 contract and used them for other 
purposes, namely to fund activities at the Area Office level. These 
policies violate Congress' intent when it enacted Section 105(d) by 
threatening the Rancheria's stable base budget and by eliminating the 
Rancheria's ability to generate interest revenue to supplement funds 
which the IHS transfers to the Rancheria.
    The IHS' policy of retaining funds appropriated by Congress in 
fiscal year 1997 for the Rancheria's calendar year 1998 contract and 
using those funds for other purposes (while allocating fiscal year 1998 
funds which have not yet been appropriated to make up the deficiency in 
the contract). This violates the Anti-Deficiency Act, as well as two 
other provisions of the Act--Sections 106(b)(1) and (b)(3)--which both 
prohibit reduction in contract funds to make funding available for 
various federal functions.
    We urge Congress to make clear to the Indian Health Service that 
the Agency is required under the Act to fully fund calendar year 
contracts out of funds appropriated by Congress in the previous fiscal 
year. Only this policy can ensure that Congress' full intent behind 
Section 105(d) is fully implemented by the Agency.
    Contract support costs deficiency.--The Rancheria is disappointed 
that the Administration requests only $12 million in Contract Support 
Costs for the Indian Self-Determination Fund. Although this amount is 
an increase over the fiscal year 1997 enacted level of $7.5 million, it 
leaves a $39 million ISD Fund shortfall (demonstrated by a table at 
page IHS-117 of the IHS Budget Justification). This means that tribes 
which contracted new or expanded IHS programs in fiscal year 1995, 1996 
and 1997, will still go without the funding to which they are entitled 
under section 102(a)(2) of the Indian Self-Determination Act and be 
forced to absorb contract overhead costs from funding intended for 
health services. While it appears that the $12 million request is 
sufficient to address our Tribe's $218,009 ISD Fund requirement, one 
hundred percent funding of all identified Contract Support Costs is 
vital if California Tribes are to continue to assume administration of 
federal programs, for the benefit of Indians without being penalized by 
a reduction in the level of services.
    We urge the Committee to work with the Department of Health and 
Human Services to ensure that sufficient funds are provided in the 
fiscal year 1998 budget to meet the contract support requirements set 
forth in section 106(a)(2) of the Indian Self-Determination Act. We 
would also urge that reporting requirements be changed so that the IHS 
is required to provide the Congress with information on every contract 
or compact which is in the negotiation process and which will require 
funding from the contract support fund, in advance, not after the 
contract is signed. Presently, the IHS is only required to report a 
shortage of Contract Support funding for the current and previous year.
    Regional Youth Treatment Center.--Due to the size of the Native 
American population (over 200,000) and the geographic size of the 
state, the California Area has been authorized to operate two Regional 
Youth Treatment Centers (YRTC)--residential alcohol and substance abuse 
treatment facilities. Because these facilities are not yet available, 
services for the youth in our area have been contracted through 
existing public and private rehabilitation programs. The fiscal year 
1998 budget request for all regional treatment centers (youth and 
adult) includes $1.4 million for the California Area.
    After much time and effort by the California tribes, the research 
and deliberation has resulted in two appropriate sites for these 
facilities. We anticipate the Southern California location will come on 
line in early 1998. The Northern California site, which would serve the 
Susanville as well as other tribes, will be available late this year. 
The Susanville Indian Rancheria requests that an additional $1.4 
million be allocated from the fiscal year 1998 appropriations to fund 
the operation of the second YRTC. Funding the second YRTC will ensure 
the availability of treatment across the State and will enable the 
tribes and tribal organizations of California to provide a coordinated 
approach for the full range of preventive, YRTC and aftercare essential 
for successful prevention and treatment of alcohol abuse among our 
youth.
    Inequity of funding for California tribes and tribal 
organizations.--Since 1970, when Federal funding of IHS services was 
partially restored for Indians in California, IHS budget allocations 
have not provided an equitable base of recurring funds or an equitable 
level of health services. The GAO issued a report in 1991, entitled 
Indian Health Service--Funding Based on Historical Patterns, Not Need, 
GAO/HRD 91-5, February 1991, which confirms these facts. The report 
concluded that ``IHS does not attempt to provide the same level of 
health services in all IHS areas; in fact services vary widely.'' See 
(p. 3)
    Part of the reason IHS has never provided the Area Office a full 
and equitable share of the Contract Health Services appropriation is 
due to the level of service previously provided by the State through 
the Medi-Cal program (the state Medicaid program). In response to the 
budget crisis within California, however, the state instituted a 
massive reorganization of Medi-Cal, which drastically reduced both the 
scope and number of services available to Indians in California. 
California tribes are also no longer eligible for certain state-funded 
supplements and various categorical grants as these funds have been 
subsumed into block grants to clients. These actions combined have led 
to a reduction of health services to Indians in California.
    Any reductions to the IHS budget which does not protect the amount 
of contract health funds which the IHS is to provide California Tribes 
will cause additional reductions of health services to Indian in 
California and could disrupt the existing system of Indian owned and 
operated health centers. We urge that Congress (1) earmark the level of 
funds to be made available for the Indian owned and operated health 
delivery systems of California; and (2) from within the appropriation, 
earmark and increase the amount of funds for contract health services 
to be allocated to California tribes.
    Equipment funds.--The Tribe is disappointed that the Administration 
has requested only $13 million for Equipment, a decrease of $1.5 
million from fiscal year 1997. Of this amount, only $3 million (the 
same as in fiscal year 1997) will be used to purchase equipment for new 
and replacement clinics built by tribes using non-IHS resources. As we 
have testified before, in order to be certified to participate in the 
Medi-Cal Managed Care program, California tribal health clinics must 
purchase and install certain essential medical equipment. Be assured 
that unless there is a significant increase in Equipment funds, our 
Lassen Indian Health Center will be no closer to obtaining the over 
$300,000 necessary to complete the equipping which has been pending 
since we finished construction of the facility in 1994.
    We urge the Committee to not only increase the Equipment allocation 
but also direct IHS to develop a distribution methodology that factors 
for differences experienced by the small tribally-owned facilities.
    IHS scholarship fund.--The Rancheria urges Congress to fund, at a 
minimum, the Administration's requested level of $28.3 million for the 
Health Professions account. We urge the Committee to fund the IHS 
Scholarships allocation within this account to not less than the fiscal 
year 1997 level.
    Impact of managed care on tribally operated health programs.--The 
tidal wave of ``managed care'' efforts among state governments is 
having a negative impact on tribally-operated health care programs. The 
goal of managed care is not improving the health status of or providing 
the best quality of care to U.S. citizens. It is instead focused on how 
to provide those services at the lowest cost. This philosophy is in 
direct conflict with the circumstances of most tribally operated health 
programs. Tribal programs are often small, and located in rural and 
isolated areas, which drives up not only the costs of supplies but 
contract medical services. Consequently, our programs must be heavily 
weighted toward prevention, early detection, community outreach and 
primary care. Under this model of health care, we have a proven record 
of success in elevating the health status of our communities. But, this 
model does not fare well in the state managed care programs, where 
prevention and community outreach have little emphasis.
    In moving toward the market based managed care, consideration must 
be given to the impact on the tribally operated programs. As it stands, 
tribal consultation and input during state planning processes is not 
consistently sought. In some cases only the knowledge that the affected 
tribes can place a hold on a state's plan through HCFA has ensured our 
being at the table. We recommend that a waiver from being included in 
the state's managed care plan be available to tribally operated 
programs if the state will not recognize the health care model used by 
the tribe as a viable part of their plan. Furthermore, reimbursements 
should be commensurate with the services provided, not limited to the 
very lowest rates as is often the case now.
    Federal Tort Claims Act coverage.--The State of California is 
rapidly moving into a managed care environment. The Susanville Indian 
Rancheria has recently experienced difficulties in its efforts to 
participate with a major Health Maintenance Organization to provide 
services in the new managed care environment as a preferred provider. 
Based on our experience, few state officials fully understand the 
Federal Tort Claims Act (FTCA) and are reluctant to accept it's 
coverage in lieu of malpractice insurance for Public Law 93-638 
contractors who manage ambulatory health centers or inpatient 
facilities. State reluctance to accept U.S. Tort Claims protection 
places the tribal contractor at risk of not being accepted as a state 
provider under its Medicaid or managed care programs.
    Most recently, representatives from the HMO requested that the 
Rancheria provide a letter from an attorney representing the federal 
government which would be the equivalent to a ``certificate of 
insurance'' in the private insurance industry. They requested that such 
a letter make clear that the government, through the FTCA, provide 
coverage to the Rancheria for any and all tort lawsuits that may be 
filed.
    We would appreciate any assistance the Committee may provide, 
perhaps through clarifying report language, to make clear to HMOs in 
California that the FTCA provides tribes and tribal organizations with 
a level of liability coverage that is equivalent to the ``certificate 
of insurance.''
    Sierra Army Depot lands and facilities transfer.--Under the Base 
Realignment and Closure Act, the Rancheria has been negotiating with 
the Army on two proposals to transfer certain lands and facilities 
located on the Sierra Army Depot to the Rancheria. These proposals, 
which are pending final approval and which have been widely supported 
by the various appropriate agencies, would transfer: (a) 120 housing 
units and a large administrative building to be used for tribal 
housing, administration functions, and economic development and (b) a 
facility known as the ``the Mods,'' comprised of single apartments, a 
large fully equipped dining area and the adjacent land to be used as 
the Regional Youth Treatment Center referenced above.
    Although we have received support and assistance from the IHS, BIA 
as well as the Army, and obtaining the necessary approvals does not 
appear will be problematic, we request that this Committee adopt 
language similar to that which effected the transfer of modular housing 
units from the Grand Forks Air Force base to the North and South Dakota 
tribes.
    On behalf of the Susanville Indian Rancheria, thank you for the 
opportunity to provide our views to the Committee on the Indian Health 
Service budget for Fiscal year 1998.
                                 ______
                                 

           Prepared Statement of Rock Point Community School

    The representatives of Rock Point Community School located on the 
Navajo Nation Reservation, respectfully express our deep gratitude to 
this Subcommittee and the Congress for the past consideration of 
providing a replacement building for an unsafe secondary school. 
Construction was completed and our students have already been in the 
new facility of over 60,000 square feet now for the second year. We are 
also grateful for the provision for the Facilities Improvement and 
Repair (FI&R) funding, soon to begin as the next step to this 
construction.
    With the same hope as in the past, we wish to submit the following 
critical budget issues on behalf of Rock Point Community, the students 
and the staff of this school for favorable consideration.
    Rock Point Community which is located in the interiors of Navajo 
Nation reservation has a defined goal of providing quality bilingual 
education, with due emphasis for family values, and respect for our 
culture and language. On the other hand we also aspire to see that our 
children are true citizens of the United States. As such, we also 
concentrate on our children's achievement of core curricular knowledge 
of subjects like English, Math, Science, History and the governments of 
our state and the USA at par with or better than the national average.
    We have realized partial success in spite of funding shortages when 
we find our students graduating, some of them from colleges. In a 
community like ours, properly trained youth is the most important asset 
for our economic and social growth. Hence, we believe investment in the 
proper education of our students is an investment in the most 
appropriate direction. We also believe that our students presently in 
our school should not lag behind to meet the challenges of the 
technologically fast advancing world ahead of them.
                 funding for the classroom instruction
    The Indian School Equalization Program (ISEP) which provides for 
the basic instruction of Navajo and other Native American students has 
chronically been short of the minimum needs. The ISEP Task Force which 
had studied the minimum need of Weighted Student Unit (WSU) value about 
five years ago had recommended $3,499. This would have provided a 
standard education to Indian students comparable to average national 
standard. This amount was estimated to be comparable also with the 
national average in expenditures per student at that time. But 
regretfully, neither the Congress nor the Administration has been 
sympathetic to this need.
    The appropriation for this purpose in fiscal year 1996 yielded at 
$2,904 for school year 1996-97, $74 less than in the previous year. 
Appropriation for school year 1997-98 is estimated to produce $3,075 in 
school year 1997-98 if the student enrollment does not increase more 
than the 3.2 percent the BIA estimates. We can argue that, with an 
average WSU of 800, Rock Point School will get about $339,000 less for 
school year 1997-98 than the average per pupil expenditure for public 
schools in school year 1992-93. The result is that we have great 
difficulty competing to hire trained and qualified teachers who can 
stay and enjoy teaching at this school.
    The cost of classroom instruction has gone up by 6.13 percent per 
year. But the Congressional appropriation has been unpredictable to 
match with the increase, sometimes even less than the preceding year, 
as is the case in the current school year.
    This results in (a) a large turnover of qualified and experienced 
teachers, leading to disrupted curricular efforts in meeting the 
national standard; and (b) many BIA-funded schools, including this 
school, having to cut down instruction hours, or lay off experienced 
teachers or impose a salary freeze.
    Whereas the national concern is putting more funds toward 
educational efforts to produce the best high school graduates with 
separate funding for advanced technology in the schools, ISEP funding 
is far short in providing an education to match with the national 
standards. This is not to talk of the need for preparing our students 
technologically for tomorrow's world.
    If the 1868 Treaty obligation of providing quality and results 
oriented education to Navajo children has to be honored, the WSU value 
for fiscal year 1998 must at least be as much as recommended by the 
ISEP Task Force for School Year 1993-94, i.e., $3,499. Thus the ISEP 
appropriation should not be less than $333.8 million.
                         student transportation
    Transportation of the students from home to school is as important 
as classroom instruction. For Rock Point Community, which is scattered 
over a radius of 15 miles, most of the students' homes or a meeting 
point is accessible only by dirt roads. These roads become very muddy 
or icy during the winter, necessitating extra expenditures for 
maintenance and repair.
    Not only that, the mileage count does not include most of the 
extracurricular activities nor mileage incurred for repair or 
maintenance and, in the case of some schools, for fueling the buses. 
For Rock Point, the nearest place for maintenance and servicing is 
around 250 miles round trip. Our buses are 6 to 8 years old, guzzling 
more gasoline and requiring more frequent repairs. It is unfortunate 
that whereas GSA rental rates have again been increased, the mileage 
rate that BIA provides is almost constant.
    The cost of transportation is short at least by 30 percent on 
average at the rate the mileage has been provided in the last several 
years. The statistics below will illustrate the fact. This is mainly 
because our transportation funding has so far fluctuated at $1.51 to 
$1.55 a mile. The actual cost of transportation for Rock Point is $2.43 
per mile. It is worth noting that the national average of 
transportation funding two years ago was $2.34 a mile.

                                             COST OF TRANSPORTATION                                             
----------------------------------------------------------------------------------------------------------------
                                                                                            ISEP                
                         School year                            Minimum        BIA        dollars     Percent of
                                                                  need       provided       used       shortage 
----------------------------------------------------------------------------------------------------------------
1995-96.....................................................     $479,316     $323,800     $155,516         32.5
1996-97.....................................................      523,732      359,100      164,632         31.4
1997-98 (estimate)..........................................      523,455      401,300      122,155         23.3
----------------------------------------------------------------------------------------------------------------

    We have tried to minimize our transportation costs by cutting down 
on extracurricular trips for the students. As the mileage remains 
almost constant, the dipping into classroom instruction funds does not 
increase. But we cannot ignore the fact that extracurricular activities 
are an important part of education.
    We cannot keep our transportation cost limited to the funding 
provided, because, if the students are not brought to school from home, 
we will neither be fulfilling our obligation to the community nor will 
there be much of a class.
    We, therefore, urge that transportation be funded at a level that 
each BIA-funded school gets at least a rate of $2.43 per mile. This 
will require Congress to appropriate at least $47.7 million. Then and 
only then, will we be able to stop using ISEP funds for transportation.
                 operation & maintenance of facilities
    This fund for which the minimum need for a school is determined by 
the use of a FACCOM formula is another area chronically short of funds. 
On the average not more than 67 percent of the needs assessed by the 
formula has been provided in the last several years. This results in 
continual deterioration of the facilities, creating an unhealthy and 
counter productive educational environment. The deterioration of the 
facilities causes further need of Facilities Improvement & Repair fund 
which is lagging so far behind. Though there has been a slight increase 
of $5.3 million in this fund for the fiscal year 1997 budget, we doubt 
that it will be able to fund even 90 percent of the need. If a similar 
amount is added in the fiscal year 1998 budget, we estimate it will 
again meet about 90 percent of the need based on the fact that some new 
schools have been constructed and the area to maintain has increased or 
will increase by nearly 800,000 square feet, as a consequence.
                quarters repair and improvement funding
    Rock Point Community School has 57 units of housing for an average 
of 130 employees each year. Out of the total, five units have been 
vacated for life safety reasons. Most of the units were built in the 
1960's and all of them need renovation to meet minimum safety 
requirements.
    Also, as in the past, we again request to build 15 to 20 new 
housing units to meet the shortage and to replace 22 portable houses, 
all of which have asbestos contamination.
    We urge this subcommittee to approve this request again and provide 
an adequate sum for the purpose.
                        administrative cost fund
    Distribution of the Administrative Cost fund has been somewhat 
encouraging in the last couple of years as it was distributed 100 
percent in the last year and it is expected at 94.4 percent in the 
current year. However, the increase of $5.6 million for fiscal year 
1997 should not be counted to increase the percentage of the payment as 
slated for the number of BIA-operated Navajo schools converting to 
Grant or Contract Schools. Since more and more BIA-funded schools are 
intending to turn grant or contract every year, we find that an 
addition of a similar amount each year to the previous year's 
allocation will merely keep up with the increase in the number of those 
additional schools for whom Administrative Costs will be needed.
    We, therefore, respectfully urge this Committee to increase the 
fiscal year 1997 appropriation for the Administrative Cost Fund by at 
least the same amount, or $5.6 million.
                               conclusion
    The Rock Point Community, its school students and staff understand 
and appreciate the necessity of balancing the national budget. However, 
we have observed in the course of several years that Indian Education 
and its concerns, more specifically its funding needs, have been 
treated as a low priority for the Administration as well as the 
Congress. This has resulted in pushing our students farther and farther 
behind the national norm. We believe that an increase of $40-$50 
million for Indian Education would have a negligible impact on efforts 
to reduce the national deficit, but it really would help Native 
American students to meet the national standards.
    We also believe that our students are the main resource of the 
economic and social advancement of our community and that proper 
education at par with the national average is an investment of which 
they should not be deprived.
    We hope that the Navajo Community of Rock Point and other Native 
Americans will not be disappointed by inadequate funding for the 
education of our children in fiscal year 1998 and that the Congress and 
the President will honor the Treaty obligation with the tribes for the 
quality education of their children.
    We are thankful again to this subcommittee for its past support to 
Indian Education in general and to the Rock Point Community School 
particularly. We hope that our request today will receive the 
Committee's due consideration. Thank you.
                                 ______
                                 

      Prepared Statement of the Pinon Community School Board, Inc.

    The Pinon Community School Board submits this statement on behalf 
of the Navajo people in the Pinon Chapter and surrounding communities 
of the Navajo Nation.
                     ihs clinic for pinon community
    Our community (Pinon and seven other Chapters of the Navajo Nation) 
has not had a health facility capable of addressing even a fraction of 
our health needs for several decades. Infrastructure development in our 
area was totally halted for 18 years while the Navajo-Hopi boundaries 
were worked out. And after that boundary was established in 1979, our 
efforts to obtain a decent health facility have been prevented by a 
lack of funding. How much longer must we wait?
    The clinic IHS has planned is not a luxurious one. It would provide 
full-time basic and emergency medical services, optometry, some 
physical therapy, community health services, a mental health and 
substance abuse unit, community health representatives and related 
community-oriented health services.
    What we have now is called a ``health station'' which operates only 
three days per week. The only services provided are minimal nursing 
support, a pharmacy, some lab work, and dental services. The nearest 
location with a doctor is in Chinle--50 miles from Pinon, and even 
further away for the Chapters to the west of Pinon. The 11,000 people 
in the Pinon clinic service area deserve to have more accessible health 
care than this.
    The first formal approval of the Pinon Clinic came in 1992 when PHS 
approved the project justification document. Basic planning, site 
selection and most of the design has been done, but the design money 
will be exhausted this summer and all work will halt unless Congress 
provides funding for fiscal year 1998 to at least complete the design.
    IHS estimates that we need $31.7 million to finish the design and 
perform the construction phase. That estimate will increase every 
year--especially if we have to stop the design work this year. We 
urgently request that Congress make a commitment this year to this 
urgently needed clinic. Please provide at least the $873,000 to 
complete the design and put this project on line to receive first phase 
construction funding in fiscal year 1999. Even at that rate, we will 
have waited a full generation for basic medical services to be made 
available in our Community.
                      bia school operations budget
    Indian student equalization program.--The total request of $296.3 
million is not sufficient for the ever-increasing operating cost of the 
operation of schools and dormitories in Indian Country. In recent 
years, growth in enrollment in Bureau-funded schools has averaged 
between 2-5 percent per year. And between this school year (1996-97) 
and school year 1998-99, BIA expects enrollment to jump 6.5 percent. 
Yet the budget request would supply only $19 per weighted student over 
the base amount for next year. As you can see, this would not even 
cover inflation-related cost increases, let alone cover the costs 
associated with additional students or provide any meaningful dollars 
for program improvement.
    We hope Congress will not be satisfied with the fiscal year 1998 
budget request. At least provide enough money to keep up with 
enrollment.
    The Pinon Community School Board further suggests that there is a 
need to re-examine the ISEP Formula by which funds are distributed to 
the schools and dormitories in the BIA system. When Congress 
established this formula methodology in 1978, it expected that the 
formula would be re-examined by BIA on a periodic basis and that up-
dating alterations would be made. This has not occurred. Rather, the 
only changes in the formula have been made by Congress itself, through 
statutory directives such as additional weights to recognize the 
additional costs of operating seventh and eighth grade programs, and 
for gifted and talented student programs.
    We ask you to supply direction and funding for BIA to perform the 
needed re-examination of the ISEP Formula to more appropriately measure 
the true total funding needs of the schools and dormitories in the 21st 
Century. That formula should be based on the highest standards of 
program quality and educational opportunity for the Indian students 
enrolled in these federally-funded schools.
    Student transportation.--The President's Budget requests $34.302 
million for student transportation--a slight increase of $2.5 million 
over the fiscal year 1997 level. For many years, this program has been 
underfunded, requiring us to use ISEF monies to supplement our 
transportation costs.
    The budget request would provide only $1.60/mile, while our 
School's transportation costs are about $2.35/mile. These costs will 
definitely increase due to two circumstances beyond our control:
  --This year GSA has been relieved of the moratorium on increases in 
        its bus rental rates. Yet there is no additional funding in the 
        budget request to help up meet these additional expenses.
  --One hundred percent (100 percent) of our bus routes are on BIA road 
        systems and these roads need improvement. Since these roads are 
        not properly maintained, they cause great wear and tear on our 
        buses. And there is no additional funding in the student 
        transportation budget request to help us meet these added 
        expenses, either.
  --Please bring some common sense to the student transportation 
        budget. In view of the average cost per mile to public 
        schools--$2.92, according to the BIA--a doubling of the funds 
        for the BIA system would not be out of line.
    Administration cost grants.--Pinon Community School Board is 
equally concerned about the President's Budget request of $44.7 
million, an increase of only $2.55 million from the fiscal year 1997 
amount. The biggest concern is insufficient funds to accommodate the 
anticipated Bureau schools converting to Contract and Grant Schools, 
thereby making them eligible for Administrative Cost Grants.
    Please ask the BIA to supply full, detailed information about the 
estimated Administrative Cost Grant need for each of the schools that 
will convert in School Year 1998-99. As you know, unless there is 
sufficient funding in this budget item, BIA will reduce every schools 
Administrative Cost Grant amount and thus none of us will get the 
funding level directed by law.
    Facilities operation & maintenance.--The facilities O&M funding 
will continue to shrink as new square footage is added to the BIA 
school facilities inventory. This year alone (fiscal year 1997), a 
total of 800,351 in new square feet will be added which will require an 
additional $3.1 million in additional facilities O&M funding. But this 
added amount is not requested in the BIA budget request. As a result, 
the percentage of need that is funded will fall even lower than the 66 
percent of need we currently get.
    It makes no sense to us for the Federal Government to build new 
schools and dormitories--such as the $16 million construction project 
we just finished at the Pinon Dorm--and then fail to provide enough 
funding to maintain these buildings so that can be utilized for their 
full expected life. Next year, after the warranty on our new buildings 
expires, we will have to provide the full array of maintenance 
services, but we will not have the funds we need to properly protect 
the big investment the Federal Government has made in them.
    We appreciate the opportunity to offer our views on the President's 
fiscal year 1998 IHS and BIA budgets.
                                 ______
                                 

    Statement of Wallace Tsosie, Vice President, Greasewood Springs 
           Community School, Inc., Navajo Nation, Ganado, AZ

    The Greasewood Springs Community School, Inc. is located on the 
Navajo reservation in the community of Lower Greasewood, which is 
approximately 70 miles west of Gallup, New Mexico, and 110 miles 
northeast of Flagstaff, Arizona. Our school serves the educational 
needs of over 390 students, in grades Kindergarten through eighth. 
Since July 1, 1996, the School has been operated by a local Board of 
Directors through a Grant from the Bureau of Indian Affairs pursuant to 
the Tribally Controlled Schools Act, Public Law 100-297. The Greasewood 
School currently faces two serious problems: the need for a safe 
gymnasium facility, and the lack of an adequate health care facility.
               a gymnasium is badly needed by the school
    The Bureau of Indian Affairs has requested $3.14 million in fiscal 
year 1998 for construction of a gymnasium facility for the Greasewood 
School, as an education Facility Improvement and Repair Project. We 
respectfully ask this Subcommittee to approve funding for this project, 
but would ask you to make two additions to it:
  --$206,000 for unexpected demolition costs. When the original budget 
        estimate was calculated several years ago, the BIA estimated 
        that the cost to remove an existing structure on the site would 
        be $150,000. Now that the demolition is complete, the BIA has 
        informed us that the actual cost was $356,000, due to the 
        discovery of significant asbestos in the previous structure, 
        and that we must reimburse BIA for this amount once 
        construction funds are appropriated. Since the $3.14 million 
        request does not include this additional cost, we respectfully 
        ask that this Subcommittee approve an additional $206,000 for 
        our gymnasium.
  --$125,600 for basic design elements not provided for in the current 
        construction budget, including: a pitched roof for the 
        gymnasium (lasts longer in our climate); hardwood gymnasium 
        floor (standard in all gymnasiums); asphalt paving (to reduce 
        dust and mud); and landscaping. These items will greatly 
        improve the quality of the gymnasium, for a modest additional 
        cost.
    In sum we request a total of $3.47 million to allow for the 
construction of quality gymnasium that will last for many years. We 
also ask this Subcommittee to approve the other projects contained 
within the President's request of $32,139,000 for Facility Improvement 
and Repair Projects.
    This gymnasium facility is desperately needed by our School, and 
was promised to the School over ten years ago. In 1985, declining 
enrollments lead the Bureau of Indian Affairs to seek consolidation of 
Toyei and Greasewood Schools, both located in communities southwest of 
Ganado on the reservation of the Navajo Nation. To induce Greasewood to 
consent to this consolidation, the Central Office of the Office of 
Indian Education Programs agreed in 1985 that a new gymnasium would be 
constructed at the Greasewood School once the consolidation was 
completed, since the existing facility had no gym and the space used 
for physical education was inadequate. The communities consented, and 
the consolidation occurred with the consolidated facility called 
Greasewood Springs Community School. Over ten years have passed since 
Toyei and Greasewood were consolidated, yet a new gymnasium has still 
not been constructed.
    The space currently used for physical education was not built as a 
gymnasium; it had to be modified to provide some space for physical 
education training to be held. According to a recent evaluation by the 
BIA's Navajo Area Engineering Office, this physical education space is 
undersized by 5988 square feet, representing a 110 percent deficiency 
for a student body the size of Greasewood. The space used for physical 
education is situated in the center of the school building and is 
surrounded by classrooms. This configuration hinders instruction, as 
the noise and flow of student traffic associated with gym classes often 
interrupts classroom instruction.
    Further, there is not adequate outdoor space adjacent to the 
current facility for student athletic activities or parking. In fact, 
the outdoor space around the current facility is hazardous to the 
safety of the students because of its close proximity to several major 
access roads. Thus, the need for safe outdoor athletic space and 
adequate parking for sporting events is particularly acute.
    At present, the gymnasium project is being handled by the Navajo 
Nation Design and Engineering Service (NDES) through a Public Law 93-
638 contract with the BIA's Facilities Management and Construction 
Center (FMCC). NDES has completed the planning phase of the project; 
the design phase is nearing completion and should be concluded within a 
few months. The local Board of Directors is in the process of assuming 
control over this project from NDES. Once this transfer has been 
accomplished, the Board of Directors will complete any remaining design 
work, and then oversee actual construction of the gymnasium. If the 
necessary construction phase funding is provided by Congress, actual 
construction of the gymnasium should take less than a year.
    The Board of Directors hopes that a new gymnasium for the 
Greasewood School will finally be constructed in fiscal year 1998. The 
planned gymnasium will be approximately 13,500 square feet, which is 
consistent with BIA space guidelines for a school of this size.
    We respectfully ask this Subcommittee to provide $3.47 million for 
completion of the Greasewood gymnasium. This facility is desperately 
needed by the School. Providing this funding would keep a promise made 
to the Greasewood School over ten years ago, and ensure that the 
students of Greasewood have a safe facility suitable for their physical 
education needs. Please do not make us wait any longer.
            a health clinic is needed for greasewood school
    We also would like to alert the Members of this Subcommittee to the 
inadequate level of health care available to the Greasewood community. 
Despite an estimated service population of over 3,000 people, the only 
health facility in our community is a small clinic located on the 
campus of the Greasewood School, which is only staffed by a doctor one 
day a week. This level of service is totally inadequate for the medical 
needs of the Greasewood community.
    The Greasewood Clinic is currently operated by Sage Memorial 
Hospital, a contract care provider, but the Hospital has proposed to 
eliminate this clinic program. The next closest health facility, Sage 
Memorial Hospital, is over 40 miles away, and the nearest IHS facility 
is over 80 miles away.
    The Board of Directors is in the process of developing a plan to 
improve the existing clinic, possible through a Self-Determination Act 
contract with the IHS, or a joint services arrangement with Sage 
Memorial Hospital. Once an adequate plan is developed, the Board of 
Directors will return to this Subcommittee with a request for earmarked 
funds in the IHS budget for a properly staffed health clinic for our 
community. Thank you.
                               conclusion
    We appreciate this opportunity to present the needs of our School 
to the Members of the Subcommittee. We strongly urge you to take the 
steps necessary to provide adequate construction funding for a 
gymnasium for our school, and to be alert to the health care needs of 
our community. Thank you.
                                 ______
                                 

  Prepared Statement of Paul A. Rooks, Chief of Police, Oglala Sioux 
                    Tribal Public Safety Commission

    The Oglala Sioux Tribal Public Safety Commission (``Commission''), 
the law enforcement agency on the Pine Ridge Indian Reservation, 
submits this statement in support of the Administration's request for 
an increase of $46.665 million to the Tribal Priorities Allocation 
(``TPA'') account, which increase includes $8.7 million for law 
enforcement. We request that Congress place law enforcement allocations 
in a special account outside of the TPA account to insulate tribal law 
enforcement programs from any future cuts to the TPA account. We 
request that Congress continue efforts in funding programs under the 
Violent Crime Control and Law Enforcement Act of 1994 (the ``Crime 
Bill'').
    The commission.--Under the Act of February 28, 1877 (19 Stat. 25), 
in consideration for the confiscation of Sioux lands and hunting rights 
worth billions of dollars today, the United States undertook to provide 
the Oglala Sioux with ``all aid necessary for civilization'' and ``an 
orderly government,'' and to ``protect [each Oglala] in his rights of 
property, person, and life.'' Originally, law enforcement was performed 
on the Pine Ridge Indian Reservation by the BIA. Since 1977, the 
Commission has provided public safety and enforcement of tribal, 
federal, and state laws pursuant to a contract with the BIA under the 
Indian Self-Determination Act, Public Law 93-638, as amended. The 
Commission currently employs approximately 36 officer positions under 
its Self-Determination Act contract with the BIA, and 62 officers using 
Crime Bill grants from the Department of Justice (``DOJ'').
    Pine Ridge Indian Reservation.--At 4,800 square-miles, the Pine 
Ridge Reservation is the second largest Indian reservation in the 
United States. It includes Shannon County, the poorest county in the 
United States according to the 1980 and 1990 censuses. The unemployment 
rate on the Reservation is about 85 percent, and is expected to 
increase due to federal budget cuts. The alcoholism rate is also very 
high. Poverty is expected to increase as a result of the Welfare Reform 
Act.
    Need for increase for BIA & tribal law enforcement.--The BIA Budget 
Justification (p. BIA-62) for fiscal year 1998 notes that national 
standards recommend three law enforcement officers per 1,000 citizens, 
but that the BIA has adequate funds for only one officer for every 43 
square miles of reservation and for every 465 members of service 
population. The proposed $8.7 million increase for law enforcement 
would be sufficient to hire 400 additional officers in Indian country--
not enough to meet the unmet need, but a step in the right direction.
    The Commission's unmet needs.--The Commission is in urgent need of 
its share of the requested increase within the TPA account to meet some 
of its more severe unmet needs. If Congress approves the requested 
general increase of $8.7 million, the Commission could realize an 
increase of approximately $450,000. These added funds could assist the 
Commission in the following manner:
    Need to hire more officers on a permanent basis.--The Commission 
has historically not received adequate funding from the BIA under its 
Self-Determination Act contract. With a service population of about 
50,000, the Commission would need 150 officers to meet the national 
standards mentioned above. In fact, the Commission would need about 110 
officers just to meet the BIA average level of law enforcement 
services, based on its service area and population. But the Commission 
has never been able to hire anywhere near this many officers.
    In fact, as the result of the fiscal year 1995 BIA budget cut, 
which decreased the Commission's BIA contract funding by nearly 
$284,000, the Commission had to reduce the number of officers funded 
under its BIA contract from 56 to 36. This would have nearly crippled 
law enforcement on the Pine Ridge Indian Reservation if the Commission 
had not applied for and received DOJ grants.
    The DOJ recognized the severe underfunding and understaffing of the 
Commission, and provided the Commission with grants under the Crime 
Bill, which enabled the Commission to hire an additional 62 officers 
starting in July 1995. A recent BIA study of the Commission (the 
``Review Team Report'') stated: ``These grants represent an impressive 
and determined effort on the part of Public Safety to secure additional 
resources.'' The DOJ grants have helped immensely to alleviate the 
shortage of officers, but only on a temporary basis. The grants last 
only 2\1/4\ years, and the oldest of the three grants expires in 
February 1998. Thus, additional funding must be obtained in the interim 
in order to retain these officers; otherwise, the Commission will be 
left eventually with only 36 officers--fewer than it has ever had and 
far fewer than the numbers needed, as noted above.
    Officers are being trained to do ``Community Policing'' throughout 
the Reservation under these grants. The Commission is also utilizing a 
cultural approach coinciding with community policing that emphasizes a 
traditional ``Akicita'' (warrior) society which complements community 
policing. It is the intention of the Commission to implement this 
concept through all facets of law enforcement in the next three years 
in conjunction with community policing. Other grants under DOJ have 
allowed the Commission to mobilize towards automation, additional 
training, and specialized services.
    Adequate salaries for officers.--After the Federal Law Enforcement 
Pay Reform Act of 1990, Public Law 101-509, raised the minimum wages 
for federal law enforcement officers, Congress increased the BIA 
appropriation by $5.8 million (fiscal year 1992 and fiscal year 1994 
total) to bring the salaries of BIA and tribal police officers up to 
Pay Reform Act levels. The BIA distributed this money proportionately 
to all BIA-funded law enforcement programs, however, rather than 
according to each program's need. The Commission's share of these 
increases ($188,400) was about $400,000 short of the amount needed to 
bring Commission salaries to the mandated levels. The Commission was 
able to bring salaries up to or close to the mandated levels in fiscal 
year 1994 by reprogramming other funds, but our officers' wages have 
lagged behind the Pay Reform Act levels since July 1995, when the 
reprogrammed funds ran out.
    It is ironic that the recent BIA Review Team Report found ``a high 
rate of turnover at the police officer position,'' which ``is very 
costly'' to the Commission, but also stated that the Commission need 
not pay its officers the salaries set by the Pay Reform Act. The Report 
should have acknowledged the obvious--that the high rate of turnover 
has been due in large part to the Commission's inability to pay 
adequate salaries.
    Overall need for equipment.--The BIA Review Team Report supports 
what the Commission has been saying for years--we need more equipment. 
The report shows that officers and criminal investigators do not have 
all of the equipment they need to perform their jobs. We agree, and we 
have been working to correct the situation, but we cannot remedy the 
problem without increased funding. Perhaps the best example of this is 
the report's recommendation that the communications system be upgraded 
and enhanced. For several years we have requested (either through a 
one-time appropriation or out of the BIA's law enforcement budget) 
$235,000 to remedy this situation, but the funds have not been 
provided.
    Special need for equipment for new hires.--The Commission has no 
funds to purchase basic equipment for the 40 new officers hired in 
September 1996 with DOJ funds. A total of $350,800 is needed for 
uniforms, service revolvers, radios, leased vehicles, and other items. 
The DOJ funds cannot be used for these expenses. Due to lack of funding 
for these items, new hires have had to borrow equipment from other 
officers, buy the equipment using their own money, or make do without 
the least essential items.
    Conclusion.--In furtherance of its recognition and support for law 
enforcement generally, and for the safety and welfare of the Indian 
people, Congress should support the Administration's request for an 
increase of $8.7 million in the TPA account for law enforcement. 
Congress should also continue funding under the Crime Bill.
                                 ______
                                 

              Prepared Statement of the Narragansett Tribe

    The Narragansett Tribe appreciates the opportunity to address the 
subject of Indian Health Service (IHS) and Bureau of Indian Affairs 
(BIA) funding needs for fiscal year 1998. Since Federal acknowledgment 
in 1983, we have exercised our right of self-government to contract 
programs serving Indians under the Indian Self-Determination Act. We 
contract and operate 13 BIA-funded programs as well as a comprehensive 
health program from the IHS, employing many of our tribal members to 
provide essential services to our more than 2,000 members. Our comments 
on the fiscal year 1998 budgets for IHS and BIA are as follows:
  --IHS (Hospitals and Clinics). Fully fund staffing and equipment 
        needs for our new health clinics through an earmarked 
        appropriation of $947,949 to bridge the shortfall we face in 
        bringing our new clinic fully on-line.
  --Fund mandatory pay increases for salaries, inflation and population 
        growth.
  --Fully fund Contract Support Costs.
  --BIA (Tribal Priority Account). Support, as a minimum, the 
        President's fiscal year 1998 budget request for TPA.
  --Fully fund Contract Support Costs.
    IHS budget (staff and equip Narragansett health clinic).--In 1991, 
the first year we testified before this subcommittee, we identified as 
our goal the establishment, on our reservation, of a tribally operated, 
out-patient health clinic to provide essential health services to our 
tribal members. We are proud to report to you that in November 1996 our 
goal was achieved with the construction and dedication of a 5,000 
square foot health clinic. We obtained private financing to build our 
health clinic from Washington Trust Bank. This would not have been 
possible, however, without a 90 percent BIA loan guarantee from the 
Eastern Area Office. The facility contains a Primary Health Clinic, 
Community Health program, Behavioral Health/Family Services, and 
Administrative Services. This is a proud achievement for our Tribe, but 
we will only recognize a portion of the clinic's potential due to a 
shortage of funds. We need your assistance if we are to realize the 
full potential of our direct service clinic.
    The IHS has informed us that they are without funds to staff and 
equip our facility. In a February 24, 1997, letter from the IHS to the 
Tribe (enclosed), we have been informed that ``there are no health 
service funds available from the IHS at this time to support your new 
facility'' and any additional funding for our Tribe's program needs 
``would have to come from the Congress.'' With the exception of 
``some'' Maintenance & Improvement and equipment replacement funds in 
the fiscal year 1998 budget, the agency is without funds to meet our 
needs. On top of this, the IHS expects to absorb approximately $100 
million in inflationary costs this year.
    In a meeting with Dr. Trujillo, his staff, and a representative of 
the Nashville Area Office February 3, we were informed that IHS policy 
does not recognize our clinic as an ``expanded'' program, thereby 
making us ineligible for existing IHS dollars. We are neither a ``new 
tribe'' nor are we an ``expanded'' program in the eyes of the IHS. We 
alerted the IHS Nashville Area Office in 1995 that we would soon have 
our clinic. They informed us then that we could not submit a new scope 
of work and budget for the clinic until it was actually built. 
Nonetheless, we thought that they were anticipating our clinic coming 
on-line and would include the required funding for staffing, 
maintenance and improvement funding and other start up expenses in the 
upcoming IHS budget request to Congress. We certainly believed that 
under existing law, as we expanded our scope of service, building a 
clinic which did not previously exist and transferring from a referral 
health care service to a direct care, out-patient facility, we would be 
eligible for ``new and expanded'' health program funds. This turns out 
not to be the case.
    Dr. Trujillo did not know where additional funds could be made 
available to the Tribe. We are greatly distressed by the position of 
IHS which regards tribes such as us, which prior to contracting health 
services under Public Law 93-638, received no health services from the 
Department, as ineligible for ``new and expanded'' program funds.
    Today, we are presently in transition from a referral based health 
program, whereby we referred our members to the surrounding medical 
community for their health care needs, to a more cost-effective direct 
service, health care system where we will hire local health care 
professionals to work full and part-time at our health clinic. Direct 
service health care provided under one roof will ensure that each 
dollar goes farther and that better health care will be administered to 
our members. Contract Health Service (CHS) referral costs totaled 
$700,000 in 1996 alone. We have cut our CHS budget by more than 50 
percent, using these funds for staffing needs, but this only permits us 
to fill 17 of 27 health care positions, leaving us with a 37 percent 
staffing shortage. By moving CHS funds to staffing needs, we are 
increasing our need for Contract Support Costs which are already 
inadequate. Staffing funds require Contract Support funds. We will, 
however, save money in the long term.
    Our current operating budget of $1.2 million will allow us to only 
bring on-line a portion of our clinic. Without additional 
appropriations we cannot afford to hire: a nurse technician; a 
pharmacist; a licensed practical nurse; a social services medical 
social worker; a social services patient services coordinator; a 
Behavioral Health Service psychologist or psychiatrist; a Health and 
Human Services Director to manage the clinic; an Administration 
Planner; a Business Office Manager and Patient Services Coordinator; 
and maintenance personnel.
    Until our full-time physician begins work in July, we have 
contracted with two local physicians to work part-time (2 days/wk) at 
the clinic. A licensed psychologist is working 1 day a week at the 
clinic. Our Community Health Service staff is conducting one-on-one 
sessions and intake for on-going contract referral health care needs 
until the clinic is officially open for business. Additional staffing 
needs alone will account for 48 percent of the additional $948,000 we 
are requesting. If we could afford a pharmacy, that would reduce our 
pharmaceutical costs by some 40-50 percent, saving us some $75,000 to 
put toward staffing needs. Pharmaceutical expenses totaled $170,000 in 
1995 alone. We enclose a budget of our health care needs.
    Third party billing of Medicare and Medicaid will allow us to make 
up some of the funding shortfalls and we hope that future health care 
reform will not deprive us of this necessary revenue source. The 
University of Rhode Island has offered us resources from their 
Audiology, Speech Pathology, Pharmacy and Nursing departments, and 
Rhode Island College has made a graduate level student in Social 
Services available to us as well as other resources. We are grateful 
for their assistance, but we still face severe funding shortfalls.
    Our greatest medical challenge is monitoring and addressing the 
needs of our diabetic patients. Screening, preventive care and 
treatment of our 75 existing patients is very costly. Our Tribe has an 
unemployment rate near 40 percent. Of the last 10 cases of diabetes 
discovered, 8 were uninsured. To meet minimal standards requires a 
commitment of roughly $2500 per patient, or $187,500 annually. Through 
clinic screening and early detection, we estimate that the number of 
diabetic patients we serve may double in 1997, as we must now serve all 
Indians who enter our clinic. CHS referral funds, however, are only 
available to members residing in Washington County.
    In addition, new welfare reform legislation has decreased funding 
for welfare mothers receiving Ritecare funds administered by the State. 
Children remain eligible for this funding through age 7, after which 
the Tribe becomes responsible. These children must now be covered under 
our Contract Health Services funding which we reduced 54 percent to 
cover staffing needs. We have some 37 pregnancies, 90 percent of which 
are low-income, most of which are high-risk.
    In conclusion, we do not know how we are going to cover these 
shortfalls as well as absorb the costs associated with population 
growth, medical inflation and pay increases. By moving from a contract 
referral health care program to a direct service program, we anticipate 
cost savings which will help but not fully cover our start up needs. We 
are doing our part to stretch existing funding to provide essential 
health services to our members. Without additional funding from 
Congress, we have no choice but to limit the health services we can 
provide to our members. We ask that Congress continue to assist all 
tribes in meeting the health needs of the Nation's First Americans by 
adequately funding the IHS budget to increase the level of need we 
provide.
    BIA budget.--We request that Congress, at a minimum, fund TPA at 
the President's fiscal year 1998 budget amount. As with the IHS budget, 
we continue to experience chronic shortfalls in carrying out contracted 
programs from the Bureau of Indian Affairs. Human Services programs 
such as Indian Child Welfare Act are so underfunded (and actually will 
decrease in fiscal year 1998 from the fiscal year 1997 level) that we 
simply cannot afford legal representation to monitor foster care 
placement of our tribal children. Education funding under Johnson 
O'Malley is slated for about a million dollar decrease under the 
President's fiscal year 1998 budget. Our Adult Vocational Training and 
Scholarship programs cannot keep pace with our need. Law Enforcement 
funding remains at the ``feasibility study'' phase of $10,000. For the 
past several years, we have emphasized the need for law enforcement 
funding. We have no alternate revenues (we possess no natural resources 
and have been denied the ability to raise revenue through gaming on our 
settlement lands by the 104th Congress) and cannot take funds from 
other TPA programs, which are strapped for funding, to establish an 
adequate law enforcement program.
    Since the 1994 First Circuit decision, there is no longer a 
question that we exercise civil, criminal and civil regulatory 
jurisdiction over our settlement lands concurrent with the State. The 
local police do not patrol our lands and the State police are more than 
20 minutes away. We have a new health clinic and community center which 
must be patrolled. We have applied for and been denied grants from the 
Department of Justice (COPS FAST and COPS MORE) because we didn't have 
even one full-time law enforcement officer.
    Finally, Congress must fully fund contract support costs which 
enable tribes to meet their administrative expenses associated with 
carrying out our programs. Congress has long recognized the need to 
fund this essential component. Each year tribes like us must make up 
for contract support cost shortfalls by using direct program funds, 
limiting the effectiveness of our already financially strapped 
programs. The Indian Self-Determination Act is clear--the Secretary 
must fully fund contract support cost needs. We request that Congress 
fully fund this essential program cost as required by law.
    Thank you for providing the opportunity for the Narragansett Tribe 
to provide comments regarding the fiscal year 1998 BIA and IHS budgets.
                                 ______
                                 

    Prepared Statement of Eric R. Davenport, Chairman, Intertribal 
                         Monitoring Association

    The Intertribal Monitoring Association on Indian Trust Funds (ITMA) 
submits this statement in support of the Administration's fiscal year 
1998 budget request for the Office of Special Trustee for American 
Indians within the Department of the Interior. While we support the 
budget request, we also want to make it clear that an appropriation of 
the $39.3 million which has been requested will not be sufficient to 
enable the Special Trustee to implement the trust fund management 
systems which are necessary to correct the century of mismanagement of 
Indian trust funds and assets.
    The Intertribal Monitoring Association on Indian Trust Funds is an 
organization composed of 34 Indian Tribes which represent over 80 
percent of the trust funds managed by the Office of Special Trustee. 
ITMA was created in 1990 to monitor federal efforts to improve 
management of Indian trust funds and to keep the Congress and the trust 
fund account holders more fully informed. Among the tasks charged to 
ITMA by our member tribal governments are preparing tribes for account 
settlement by providing analysis of the reconciliation reports and 
technical assistance in analyzing tribal specific reports; assisting in 
the development of objective, fair and accurate methodologies for the 
reconciliation of the IIM accounts; and obtaining tribal input on 
continued implementation of the Trust Fund Management Reform Act.
    ITMA supports the proposed fiscal year 1998 level totalling $39.3 
million, an increase of $5.2 million over the fiscal year 1997 level. 
The $5.2 million requested increase would provide additional resources 
for trust systems improvements, but is far short of the funding needed 
to implement a plan to correct the existing flawed systems. ITMA also 
supports the proposal to increase staff of the Office of Special 
Trustee by 22 Full-Time Equivalent employees over last year, for a 
total staff of 310.
    We appreciate the fact that the Administration's request contains 
$250,000 in fiscal year 1998 for ITMA, however we must note that this 
amount is not sufficient for ITMA to be able to fully meet its 
responsibilities to Tribes, the Congress and the Department. Our 
experience since the formation of ITMA in 1990 tells us that annual 
funding of $400,000 is needed to enable us to promptly and accurately 
monitor developments in the management of trust funds and provide 
timely information to the account holders and the Congress. We 
respectfully request that the Subcommittee consider funding for ITMA at 
the level of $400,000 for fiscal year 1998. ITMA does not support the 
use of any of the funding requested for fiscal year 1998 for purposes 
of litigation. The Department of Justice has the responsibility for 
representing the Department of the Interior in any litigation. We see 
no justification for taking the scarce resources that are so 
desperately needed to implement improvements in the management of the 
trust funds and diverting them to defray any of the costs or expenses 
incurred by the Department of Justice in its defense of the past 
mismanagement of the trust funds.
    The objectives ahead in fiscal year 1998, as the Office of Special 
Trustee and Office of Trust Funds Management continue trust management 
reform efforts, are demanding: putting in place an accounts receivable 
system to track, collect and account for funds derived from Indian 
trust assets, and an automated accounting system for IIM accounts. ITMA 
has strongly advocated that adequate resources must be made available 
to the Special Trustee for the necessary systems and personnel--
including building the infrastructure required for the daily 
collection, investment, accounting, and disbursement of trust funds--to 
accomplish the required management reforms. Until these and other 
reforms are completed, the government's ``breach of trust'' to tribal 
and individual Indian account holders continues and the federal 
government's liability increases. In fact, until these reforms are 
achieved, the Department remains in violation of the provisions of the 
American Indian Trust Fund Management Reform Act.
    In addition, the Special Trustee is holding consultation meetings 
with tribes throughout the country on his draft Strategic Plan. 
Elements one through eight of Phase I of the draft plan are supported 
by ITMA. We have concerns with element nine of the plan, which calls 
for the transfer of all trust functions and the related funding to the 
American Indian Trust Development Authority (AITDA). We believe that 
the AIDTA element of the Strategic Plan needs more thorough thought and 
note that it has been strongly opposed by most Tribal governments. We 
have not had sufficient time to consider elements ten through sixteen 
of the draft plan.
    Phase II of the draft Strategic Plan calls for the creation of a 
Development Bank. This portion of the plan is virtually identical to 
the proposal for a comprehensive settlement which has been proposed by 
the Special Trustee's Advisory Committee. ITMA does not support the 
establishment of a Development Bank as part of a settlement at this 
time for a variety of reasons, not the least of which is a concern 
about how such an institution would be capitalized and owned.
    ITMA has reviewed the settlement options which were proposed by the 
Department on December 11, 1996. ITMA has officially taken a position 
opposing those options. We understand that the Department is refining a 
proposal for a comprehensive settlement of trust fund mismanagement 
claims based on consultation with Tribes during January of this year. 
We will, of course thoroughly review any such proposal when it becomes 
available. However, if it contains the options identified in the 
December 11, 1996, proposal ITMA will oppose it because of its inherent 
unfairness on a host of issues ranging from the payment of interest to 
the netting of amounts deemed to be due to or due from Tribes as a 
result of the reconciliation project. As we have stated previously, the 
task before all of us right now is to repair the system for management 
of the trust funds. Very few, if any, of the account holders have 
sufficient and reliable information at this time on which to base a 
reasoned judgment about settlement.
    ITMA believes that the emphasis for the use of federal resources 
should to be on fixing existing management systems, so that account 
holders will have reliable information and the possibility of new 
claims against the federal government will be minimized. We are 
committed to doing everything we possibly can to assist the Congress, 
the account holders and the Special Trustee to complete this important 
work and bring the management systems into compliance with the Trust 
Funds Reform Act.
    The Intertribal Monitoring Association on Indian Trust Funds looks 
forward to continuing to work with the Office of Special Trustee, the 
account holders, and the Congress to support efforts to improve 
management of Indian trust funds. We believe that we all share a common 
vision--that tribal and individual Indian account holders should 
achieve the simple justice any other citizen would expect from the 
institutions, be they commercial or governmental, entrusted with the 
management of their money: a fair accounting and a fair return.
                                 ______
                                 

                Prepared Statement of the Navajo Nation

                              introduction
    Mr. Chairman and Members of the Subcommittee the Navajo Nation, 
America's largest Indian nation. On behalf of the Navajo people, 
greatly appreciates this opportunity to present our views and 
recommendations regarding the fiscal year 1998 appropriations for the 
Department of the Interior and Related Agencies (DOI). This testimony 
highlights our request for fiscal year 1998 appropriations.
                           the navajo nation
    The Navajo Nation is the largest Indian Nation in America with a 
population of 250,000 members. Spanning Arizona, New Mexico and Utah, 
the Navajo Nation encompasses 17.5 million acres--one-third of all 
Indian lands in the lower 48 states--and is larger than the States of 
Connecticut, Delaware, Maryland, Massachusetts and Rhode Island. Unlike 
those states, however, the Navajo Nation is home to the poorest of 
America's rural poor. While the average unemployment in America today 
is 5.8 percent, the unemployment rate on the Navajo Nation averages 38 
percent to 50 percent, depending on the season. Over 56 percent of the 
Navajo people live in poverty. Per capita income averages $4,106, less 
than one-third of that in the surrounding states. Only a few Navajos 
enjoy basic ``necessities'' of life that are taken for granted 
elsewhere in the United States--77 percent of Navajo homes lack 
plumbing, 72 percent lack adequate kitchen facilities, and 76 percent 
lack telephone service. Though the Navajo Nation is slightly larger 
than the state of West Virginia, only 2,000 miles of our roads are 
paved. This is barely 11 percent of West Virginia's 18,000 miles of 
paved roads. Until recently, we had just three banking facilities 
within our entire 27,500 square mile land area.
    Ironically, Mr. Chairman, the Navajo Nation is perceived as one of 
the more prosperous of Indian nations. Tragically, these types of 
living conditions exist on hundreds of other Indian nations throughout 
the United States. Nationwide, unemployment rates on Indian nations 
average 56 percent.
    Mr. Chairman, I focus my testimony on several of the Navajo 
Nation's specific requests for fiscal year 1998 funding for critically-
needed projects. But in a larger sense, I urge the Committee to 
``reinvent'' its own approach to Indian country funding. Rather than, 
chipping away year-after-year, generation-after-generation, in a 
piecemeal approach at existing conditions in Indian country, why not 
marshal all available federal resources in a coordinated, comprehensive 
and government-wide effort similar to the plans used to rebuild Germany 
and Japan after World War II. Such efforts can rectify the massive 
infrastructure deficiencies that prevent us from competing on a level 
playing field against even the most economically-distressed non-Indian 
communities.
    Such approach would redirect, government-wide federal resources and 
programs from those program which have already realized their purposes 
to Indian programs. Scarce federal resources can be targeted and 
invested in areas, like the Navajo Nation, where they are really 
needed. The goal must be to develop self-sustaining reservation 
economies consistent with Indian self-determination and self-
governance.
    Enactment of welfare reform marks a significant reversal of federal 
entitlement policy that will greatly affect Indian nations. With 
respect to Indian reservations, the rationale that ending welfare 
assistance will force people to work simply ignores the lack of 
economic development, and subsequent employment opportunities. America 
must acknowledge the grim reality on Indian reservations--there are no 
jobs. The chronically high unemployment rate on Indian reservations is 
indicative of a seriously flawed economic development climate. The 
Navajo Nation has consistently pointed out major barriers to economic 
development, most significant are double taxation and the lack of 
infrastructure and economic development incentives that Congress must 
address before economic development opportunities can occur.
    Navajo culture encourages individual self-sufficiency and 
resourcefulness. However, there is a limit to the ability of Indian 
nations to unilaterally improve their unemployment situation. If our 
needs are not addressed, the unemployment situation will only worsen. 
Terminating welfare assistance, without creating the necessary job 
opportunities for welfare recipients, will severely reduce on-
reservation spending, thereby negatively affecting reservation 
economies. The limited reservation businesses will not only be forced 
to lay off employees, but some may even be forced to close their doors. 
This will in turn increase our 38 percent unemployment rate and 56 
percent poverty rate.
    While current efforts to eliminate the accumulated federal deficit 
are commendable, the Navajo Nation cannot stress enough that the 
federal budget should not be balanced at the expense of the Navajo 
Nation and other Indian nations for several reasons. First, such 
efforts will result in termination of treaty obligations that the 
federal government has with the Navajo Nation. Secondly, Indian nations 
did not benefit from the enormous build up of the deficit beginning in 
the 1980's. Lastly, Indian nations, due to consistent inadequate 
funding, have and will remain severely impoverished and underdeveloped 
compared to the rest of the United States.
    Congress's own analysis, prepared by the Congressional Research 
Service, unequivocally shows that since 1985, per capita federal 
expenditures on Indians equaled approximately $2,400. This is $1,000 
per person less than the rest of the U.S. population. During the years 
of federal deficit spending many programs, principally benefiting non-
Indians, received enormous funding increases while Indian program 
funding remained constant or actually decreased. Now that the bill has 
come due on the federal debt, Indian programs are slated to receive the 
burden of cuts. The unfairness and the inequity of this result surely 
was not the federal government's intent.
    The U.S. Government entered into a solemn treaty with the Navajo 
Nation in 1868. This treaty has the force of law and imposes explicit 
contractual obligations upon the United States government. These 
obligations for such matters as education, agricultural, natural 
resources preservation, and others require adequate federal funding to 
execute and fulfill. Budget cuts for Indian programs would, therefore, 
violate these treaty obligations, and amount to termination of such 
obligations by appropriations.
    In great part, due to the neglect of the United States to live up 
to its trust and treaty obligations and very little or no assistance 
from states in which Navajo People are also citizens, living conditions 
on the Navajo Nation are comparable to third world conditions. The 
Navajo Nation has an enormous deficit in all aspects of development 
when compared to other rural areas of America. These conditions are 
perpetuated by inadequate funding or lack of funding and the federal 
agencies lack of awareness or unwillingness to fulfill trust and treaty 
responsibilities to the Navajo Nation.
    The Navajo Nation has identified, through a preliminary needs 
assessments, a minimum of $2.97 billion needed in the six primary areas 
of rural development to achieve a level playing field with the rest of 
America. These needs prevent the Navajo People from achieving 
prosperous rural livelihoods and from realizing full potential for 
social and economic productivity and well-being. The ``pursuit of life, 
liberty and happiness,'' the cornerstones of American democracy, are 
therefore denied to the original inhabitants of this great land.
    We recognize that budget cuts are inevitable. But, we also 
recognize the compassion and fairness of this Committee, the Congress, 
the American leadership, and the American People. That compassion and 
fairness are demonstrated by the consistent large funding for foreign 
countries. The compassion and fairness of the American people can also 
be demonstrated by living up to promises made to the Navajo people in 
the Treaty of 1868.
          requests for doi fiscal year 1998 budget inclusions
    Today, the Navajo Nation merely highlight parts of our overall 
request for fiscal year 1998.
Education
    The Navajo Nation strongly requests $14 million for Many Farms High 
School Construction. The Navajo Nation also requests $13.9 million for 
Navajo undergraduate scholarships. In 1996, the Navajo Nation Higher 
Education Grant Program received over 17,000 applications and only 
3,152 students were awarded scholarships. The Navajo Nation requests 
that a funding formula be based on native population that fairly 
distributes scholarship funds accordingly to Indian nations. For the 
Johnson O'Malley Program, the Navajo Nation requests that the 
Subcommittee request $18 million (the fiscal year 1997 enacted level) 
for services to support over 51,209 eligible Indian students between 
grades K-12 and employ over 224 professional/para-professional staff in 
major Navajo school districts. The Navajo Nation requests that the 
Subcommittee provide funding for the Indian Adult Education program at 
the fiscal year 1997 level of $2.5 million
    The Navajo Nation requests $467 million for funding of Bureau 
operated schools and dormitories on the Navajo Nation, school 
operations, particularly the $296.2 million for Indian Schools 
Equalization Program (ISEP). The Nation has 66 Bureau funded schools 
and expects an increase in enrollment for the school year 1996-97. Ten 
(10) Bureau-operated schools will be converting to Public Law 100-297 
Grant Schools by July 1, 1998 and will require an additional $1.589 
million above the President's $2.5 million increase for Administrative 
Cost Grants; the Navajo Nation also requests that full funding be 
provided for severance pay to federal employees upon conversion of 
Bureau-operated schools to Grant schools, estimated at $5.7 million. 
The Navajo Nation requests $500,000 for tribal departments of education 
to enhance their capacity to manage BIA education programs. 
Additionally, the Navajo Nation requests that the Subcommittee restore 
funding for the Institutionalized Handicapped which will allow Navajo 
schools to provide important specialized services.
    For the Navajo Community College (NCC), the Navajo Nation requests 
$7.5 million for the operating budget. Furthermore, $2 million is 
requested for desperately needed funds for renovation and construction. 
This funding will address health and safety requirements and compliance 
with the American with Disabilities Act at the NCC campuses. For its 
Shiprock campus, the Navajo Nation requests $1.2 million for the 
mandatory asbestos abatement and roof replacement.
Natural resources development
    The Navajo Nation very strongly recommends $38.5 million for the 
Navajo Indian Irrigation Project (NIIP). Much of this will be used 
toward the construction, operation, and maintenance of NIIP. NIIP was 
authorized by Public Law 87-483 and further amended by Public Law 91-
406, but is currently 30 years behind schedule. An additional $6.33 
million is requested to fund operation, maintenance, and replacement 
costs of NIIP's existing canal system.
    The Navajo Nation requests $5.375 million for water resource 
development and maintenance programs, including: $3.98 million for the 
development and rehabilitation of livestock water facilities; $500,000 
for operation and maintenance of irrigation projects; $570,000 for the 
Navajo Nation water monitoring and inventory program; $100,000 for 
technical studies for Navajo Nation San Juan Irrigation projects; and 
$225,000 for technical studies for Navajo Nation Clear Creek/Chevelon 
Water Supply Protection. Further, the Navajo Nation requests $1.535 
million for Navajo water rights protection and to conduct technical 
studies in the Little Colorado and San Juan River Basins. This funding 
would allow the Navajo Nation to adequately prepare for litigation over 
water rights.
    The Navajo Nation requests $1.9 million for non-renewable resources 
programs, including: $1 million per year for establishment of a Navajo 
Nation Surface Mining Program; $220,000 for Inspection of Navajo Oil 
and Gas Leases and Operating Agreements; and $700,000 for Minerals 
Audit Program. Additionally, the Navajo Nation requests $4.3 million 
for the abandoned mine lands reclamation program ($3.96 million) and 
UMTRA program ($344,178).
    The Navajo Nation requests $2.07 million for forest management and 
wildlife projects, including: $1.5 million for the management of 
600,000 acres of timberland and 4 million acres of woodlands. 
Management will consist of using the ``best management practices'' with 
modern techniques and equipment, while addressing the Navajo publics' 
concerns. The Navajo Nation also requests $298,710 for the Navajo 
Natural Heritage Program and $275,000 for wildlife management and 
enforcement.
    The Navajo Nation requests $21.95 million for Navajo cultural and 
historic preservation projects, including: $10 million for direct 
grants to Indian nations to support tribal preservation projects and 
programs; $10 million for grants to Indian tribes to repatriate human 
remains and sacred and ceremonial items; $1.487 million for the 
development of a comprehensive historic preservation and cultural 
resource management plan; and $463,000 for public protection, 
management, research, and interpretation of the Chacoan Outliers sites. 
To meet the responsibilities of the Navajo Nation Safety of Dams 
Program, the Navajo Nation requests $13.7 million, of which, $13 
million will be used for the rehabilitation of the Many Farms Dam; 
$200,000 for the development of an early warning system for dams 
located on the Navajo Nation; and $500,000 for maintenance and 
administration funds.
Economic development
    The Navajo Nation requests $10,503,000 to develop Antelope Point 
Infrastructure near Page, Arizona. The appropriation would provide 
basic utilities and power distribution, telephone service, internal 
roads, public launch ramp, parking trails and walkways, signage, fire 
and police facilities, and landscaping for public areas to the Antelope 
Point Recreation Area.
    The Navajo Nation requests $3,925,000 to plan, develop and 
construct a regional water and sewer system to support future business 
and community development efforts near Monument Valley (Arizona and 
Utah). This includes basic utilities for the development of a gift 
shop, visitors center complex, hotel/motel designation, resort and rest 
area, and public signage.
Indian Health Service facilities requests
    The Navajo Nation supports the President's fiscal year 1998 Budget 
Request for $25 million for Phase I construction of the Fort Defiance 
Comprehensive Health Care Facility. The proposed facility will have 58 
beds and will provide medical/surgery, pediatric, adolescent 
psychiatric, intensive/CCU, nursing and ambulatory services. The 
adolescent psychiatric unit will be the only one of its kind within the 
IHS health care system. This facility is one of two special initiatives 
on the IHS priority list.
    The Pinon Health Center is fourth on the national IHS priority 
listing for out-patient facilities construction. The Navajo Nation 
request $966,000 for the architectural and design phase of the proposed 
health center in Pinon, Arizona.
    In the Indian Health Service (IHS) budget, the Navajo Nation 
requests $1.249 million in supplemental appropriations for Red Mesa 
Health Center's architectural design. The design phase of the health 
center will commence upon approval of the planning documents by the IHS 
Headquarters. Approval is projected by the end of April 1997.
Environment
    The Indian Lands Open Dump Cleanup Act of 1994 (Public Law 103-399) 
mandated the Indian Health Service (IHS) to address the closure of open 
dumps on Indian lands. Navajo Area-IHS has failed to meet the 
requirements of the Act due to lack of funding. The Navajo Nation is 
greatly concerned that both the IHS and the BIA have grossly 
underestimated the severity of the Navajo Nation's open dump problem. 
For example, BIA has claimed responsibility for only 25 active dump 
sites on the reservation and has committed to proceeding with closure 
activities only on these sites. Likewise, Navajo Area-IHS submitted a 
list of 65 dump sites to IHS Headquarters for inclusion into a final 
report for Congress, as required under Public Law 103-399. Yet, in June 
1996, the Navajo Nation completed its own open dump site inventory--
sites that are used by four or more families--and have estimated that 
there at least 465 sites that need to be closed by October 1997. The 
Navajo Nation estimates that $5 million will be needed in order to 
complete Phase I closure (which consists of consolidating small dump 
areas where there is no mechanical manipulation of the site into larger 
community dump sites and closing and covering the larger community 
dumpsites). The Navajo Nation requests that the Subcommittee provide 
this amount and direct both IHS and BIA to reevaluate their inventory 
processes to include the sites identified by the Navajo Nation and 
request funding accordingly.
Social services
    The Navajo Nation requests $2.5 million to continue providing 
prevention, intervention and treatment services to Navajo children, who 
are victims of child sexual abuse and child abuse and their families. 
In recent years, child sexual abuse and molestation crimes has become 
one of the most reported criminal activity on the Navajo Nation. Also, 
the incidents of child abuse and neglect is on the rise, as well. This 
becomes an issue, especially when there is no one to advocate on their 
behalf and our Navajo children cannot protect themselves. On the Navajo 
Nation, our Navajo children are our most important vital resource, 
therefore, their health, safety and welfare must be made a priority, at 
all cost. At this time, the Navajo Nation Child Sexual Abuse Prevention 
Project is assigned the responsibility of providing services for 
children who have been sexually abused and their families. The 
therapeutic and treatment services is provided using the Western 
Medicine approach or if the family wishes, by use of the traditional 
medicine and ceremonies. There are currently five direct service 
offices located on the Navajo Nation, one at each of the agency office, 
and one office at the Central Office, that oversees the administration 
of the program and the funds.
    The Navajo Nation has to address its domestic violence issues and 
problems to curb the incidents of family violence. This is done by 
subcontracting with five non-profit domestic violence organizations or 
battered families shelter homes located on the Navajo Nation, who 
provide the therapeutic and treatment services needed by the victims of 
domestic violence and their families. Currently, the facilities are 
under funded and have limited resources to address their overburdened 
caseloads and for the daily operation of shelters and safehomes. 
Therefore, the Navajo Nation requests full appropriation, as originally 
authorized by Congress, in Public Law 101-630, Indian Child Protection 
and Family Violence Prevention Act, an Indian-Specific Legislation 
designed to combat child sexual abuse, child abuse and neglect and 
domestic violence in Indian country.
    The Navajo Nation requests restoration of a 17 percent funding cut 
to the fiscal year 1995 level for welfare assistance programs which 
include child welfare services and adult care. Without restoration of 
the 17 percent cut some programs will receive a 38 percent funding 
reduction and over 2,300 eligible Indian beneficiaries per month will 
be denied services.
Navajo-Hopi
    The Navajo Nation seeks $31 million for special rehabilitation 
projects in the Former Joint Use Area and Western Navajo Agency. Due to 
the federal relocation program, litigation over ownership, and the 
related construction freezes, little or no development has taken place 
in the last 27 years. During the freeze period, Navajo residents were 
denied assistance from federal, state and Navajo Nation programs that 
target low income citizens. Hundreds of millions of dollars are needed 
to elevate the living conditions of the people in these areas.
    Of the amount requested, $15 million would be for planning, 
housing, community services and infrastructure development in the Hopi 
Partitioned Land. Over 250 Navajo families remain on the Hopi 
Partitioned Land. Due to the construction freeze, these families now 
live in deplorable conditions.
    This funding request also includes $15 million for housing, 
community services, and range restoration in the Navajo Partitioned 
Land. Influxes of relocatees and refugees created by the federal 
relocation program have led to overuse of already limited land and 
infrastructure, high rate of unemployment, and overcrowding and 
dilapidated housing. Finally, $1 million dollars is requested for 
planning purposes in anticipation of the lifting of a 27-year federal 
construction freeze in the Bennett Freeze Area.
    The Navajo Nation also requests the reauthorization of 
appropriations for the Navajo Rehabilitation Trust Fund for fiscal year 
1998 through fiscal year 2001 in an amount not to exceed $10,000,000 in 
each fiscal year. This fund has provided critically needed resources to 
address the tremendous development and services deficiencies 
experienced in the ``land dispute'' area.
Public safety
    In fiscal year 1998 the Navajo Nation requests $29 million for law 
enforcement activities including, funding for corrections facilities 
and criminal investigators. A 1992 Consent Decree limits available 
detention space for criminals and requires the Navajo Nation to upgrade 
and replace jail facilities. All five Navajo adult detention facilities 
are listed on the BIA's Planning of New Institutions (PONI) priority 
list. No funding has been provided. The Navajo Nation requests $2 
million to renovate detention facilities and $200,000 for needs 
assessments of adult detention facilities.
    The Navajo Nation also requests $1.4 million for the completion of 
the design and planning phase of three juvenile detention facilities: 
Crownpoint--$400,000; Kayenta--$300,00; and Shiprock--$700,000. The 
Navajo Nation is experiencing an increase in crime rates, especially 
violent juvenile crime. The Navajo Nation does not have sufficient 
juvenile detention facilities and lacks rehabilitative services.
                               conclusion
    The Navajo Nation thanks Chairman Gorton and the Members of the 
Subcommittee for their leadership and support of these programs.
                                 ______
                                 

Prepared Statement of Pearl Capoeman-Baller, President, Quinault Indian 
                                 Nation

  summary--quinault nation appropriations requests: tribal priorities
1. Quinault Cultural Preservation Center (QCPC) +$300,000
    Start-up funds for construction and development of a Cultural 
Preservation Center and Museum is needed to preserve the cultural 
heritage of the Quinault people--a nation which consists of 7 tribes. 
Through Self-Governance funding, a small cultural program was 
developed, however, a facility is needed in order to properly restore, 
preserve and display artifacts, family heirlooms and other 
archeological findings. Request start-up construction funds of 
$300,000.
2. Seniors/Elders Assisted Living Program--I.H.S.--Community Health 
        Program +$250,000
    As our elderly population increases, there has been a associated 
increase in the need for assisted living care. Our Public Health/
Community Health Program is unable to provide continuous care due to 
lack of staffing. We are in great need of 24-hour care for many of our 
seniors in both villages on the Quinault Reservation. Request earmark 
of $250,000 initial funding and $150,000 on a recurring basis to 
establish an elders assisted living program in the villages of Queets 
and Taholah.
  quinault indian nation requests and recommendations: national level
    Office of Special Trustee--American Trust Fund Management Reform 
Act of 1994.--Request language directing the Office of Special Trustee 
to complete analysis, true consultation and report back to Congress 
before implementing the Draft Strategic Plan of the Special Trustee for 
American Indians.
    BIA/IHS contract support funds.--Provide sufficient contract 
support funding for increased tribal acquisition of programs, services 
and activities in all DOI/BIA and I.H.S. programs. Instruct the BIA to 
establish a contract support funding process similar to the process 
established by the Indian Health Service.
    Tribal priority allocations.--Restore the BIA budget--Tribal 
Priority Allocations to the fiscal year 1995 levels, to ensure tribal 
programs are not diminished. The underlying principle for the 
establishment of the Tribal Budget System was to provide for each 
Tribe's base budget to receive annual adjustments for inflation. This 
has not happened since 1995. Request increase of $73 million to TPA (to 
$830 million) to bring funding levels to same level as fiscal year 1995 
for Tribal Priority Allocations.
    Welfare reform implementation programs.--Require establishment of 
necessary infrastructure on Indian Reservations of job training, adult 
and basic education and early childhood development programs.
    Elevation of Indian Health Service.--The Indian Health Service is 
the largest direct health care provider within the Department of Health 
and Human Services and should answer directly to the Secretary to 
insure that issues which impact the agency are addressed. There are 
many legal and cultural issues which are unique to Indian Health 
programs and tribes rely on the Director of the I.H.S. to address these 
concerns. During the last Congress, the Honorable Sen. John McCain 
introduced legislation (S. 311) which would elevate the Director of the 
I.H.S. to the Assistant Secretary level within the DHHS. Since the 
elimination of the Assistant Secretary of Health, the need for this 
legislation has increased.
    IHS mandatories.--During fiscal year 1998, it is imperative that 
funding be provided for all mandatory costs increases incurred by the 
Indian Health Service, including medical inflation, mandatory payroll 
increases and population growth (including new tribes). In the 
Northwest where Indian Health programs must purchase all inpatient and 
specialty care from private providers, it is particularly important 
that inflationary cost increases for the Contract Health Services 
program be funded. In past years, deferred medical and dental services 
in the Northwest have been as much as $4 million annually. This is a 
great disservice to Indian people and should not be allowed. Request 
full funding of mandatories for fiscal year 1998.
    Joint BIA/I.H.S. issues.--Contract support funds are required for 
tribes to successfully manage their own programs. The IHS has an 
estimated shortfall of $30 million and the BIA has an estimated 
contract support shortfall of $5 million in fiscal year 1998 and $16 
million in fiscal year 1997. Even with the proposed $10 million 
increase in fiscal year 1998, these shortfalls deprive Tribes of needed 
administrative services. These shortfalls prevent the realization of 
the Congressional goal of Self-determination for tribes awaiting these 
funds. Recommend full funding of contract support costs.
    Northwest Portland area Indian Health Board.--Indian Health 
programs and services are provided to over 80,000 Indian people in the 
Northwest (Oregon, Washington and Idaho). The partnership forged by 
Congress with tribal governments and the Indian Health Service over the 
last 30 to 40 years has resulted in significant improvement in health 
care delivery to Indian people. Even though health status measurements 
of American Indians are still lagging, progress has been made. Death 
rates of Indian people from infectious diseases, gastrointestinal 
diseases and tuberculosis have dropped considerably; maternal death 
rates have declined by 65 percent since 1973 and immunization rates for 
Indian children exceed 90 percent, compared with the national average 
of 67 percent. As Congress is required to control spending, it should 
not cut out model programs that have demonstrated success. To dismantle 
this successful public health care system could create disastrous 
consequences for the health of all American people and could relegate 
health care services to Indian people to that of third world countries.
                  quinault indian nation funding needs
BIA Self-governance: Tribal Priority Allocations public safety and 
        justice--tribal courts +$100,000
    Funding to enhance the judicial court system to provide adequate 
pretrial and post-trial services to clients of the Quinault Nation 
Court. The historically underfunded Quinault Tribal Court currently 
suffers from lack of funding in several areas including: research and 
law clerk functions, court appointments, guardian ad litems, 
preparation of written decisions, process services, and clerical 
services. Despite these many deficiencies, the Court has managed to 
operate relatively well due primarily to multi-talented, cross-cultural 
and hard-working staff who are dedicated to the field and to justice. 
With proper funding, the possibilities for an exemplary court system 
are limitless.
Tribal priority allocations: Resource management--water resources 
        +$50,000
    Funding required to continue Coordinated Tribal Water Quality 
Program (CTWQP) to collect new water quality and stream flow data and 
to correlate all available scientific information. This program 
currently is funded by EPA, which will end in fiscal year 1998. Request 
increase to QIN TPA allocation to continue this critical data 
collection, interpretation and development of water quality standards.
Construction: Natural resources facility +$500,000
    Construction funds are needed to complete the construction of Phase 
II Administration Complex. This building will supply the facility and 
infrastructure necessary for the Nation to move into the 21st Century 
with its Natural Resource Management responsibilities. The Natural 
Resources Department consists of 47 employees located in four buildings 
scattered across the reservation. Request a Congressional earmark of 
$500,000 towards construction of facility.
Tribal priority allocations: Wildlife and parks--``Shale Creek Pond'' 
        +$75,000
    This facility was built in 1988 by Washington State Department of 
Fisheries as part of a cooperative wild coho supplementation program, 
and has become an integral part of the Quinault Indian Nation's efforts 
to improve productivity of the Queets River wild stock of coho salmon. 
The level of salmon harvest opportunity in Washington ocean fisheries 
is often linked to the status of this stock, a key indicator of wild 
coho stocks coast-wide. Increasing production of this wild stock 
provides for increased harvest opportunity to Indian and non-Indian 
ocean fisheries alike. Request $75,000 to fund operating costs of this 
facility which will benefit commercial and recreational fisheries in 
the Pacific Ocean and Queets River.
Construction: Fisheries building +$75,000
    The fisheries building located in Queets is used to house 
biologists, technicians and equipment to conduct wild salmon studies. 
The building is in an extreme state of disrepair. Thirty years ago it 
was a fire station and currently the walls, roof and foundation are all 
crumbling. A garage with storage space and interior offices are 
required. Estimated cost is $75,000.
National Park Service: Historic preservation fund Quinault Cultural 
        Preservation Center (QCPC) +$300,000
    Start-up funds for construction and development of a Cultural 
Preservation Center and Museum are needed to preserve the cultural 
heritage of the Quinault people--a nation which consists of 7 tribes. 
Through Self-Governance funding, a small cultural program was 
developed. However, a facility is needed in order to properly restore, 
preserve and display artifacts, family heirlooms and other 
archeological findings. Request earmark in Historic Preservation Fund.
Indian Health Service: Elders assisted living program +$250,000
    The Quinault Nation Seniors program is in dire need of an ongoing 
assisted living program. More and more elders are in need of around-
the-clock care. Families can provide some of the care, and the Nation's 
Community Health Program is able to provide only minimal assistance, 
however, more and more of our elders are requiring assisted care. We 
are unable to provide this care without hiring additional nurses and 
aides to provide this much-needed care. Request earmark of $250,000 
initial funding and $150,000 on a recurring basis to establish an 
elders assisted living program in both villages on the reservation.
                                 ______
                                 

 Prepared Statement of Benito Valencia, Chairman, Pascua Yaqui Indian 
                            Tribe of Arizona

                              introduction
    The Pascua Yaqui Tribe of Arizona is pleased to offer written 
testimony regarding the President's Budget Request for fiscal year 1998 
Indian Programs and Services. We would like to acknowledge that the 
Tribe concurs with the comments submitted to the Senate Committee on 
Indian Affairs, by President Ron Allen of the National Congress of 
American Indians on February 26, 1997, concerning the proposed fiscal 
year 1998 budget. The fiscal year 1998 funding requests to this 
Subcommittee of the Pascua Yaqui Tribe include: Sufficient funding 
through the Indian Health Service to provide health services to all our 
eligible tribal members under our HMO arrangement estimated by IHS to 
be $8 million over the budget request in fiscal year 1998 (the $10.7 
million originally stated in our House testimony has been revised by 
the IHS to more accurately reflect the costs); and $200,000 through the 
Bureau of Indian Affairs to conduct seven critical studies that were 
authorized by the Congress in Public Law 103-357 in 1994.
                         background information
    As you may be aware, the Pascua Yaqui Tribe, through Congressional 
enactment of Public Law 103-357, was authorized to open tribal 
enrollment until October of 1997. The Tribe's population is expected to 
grow to approximately 14,000 to 16,000 tribally enrolled members. This 
fact will makes us one of the largest tribes in the country. Having 
said this, however, we remain one of the most severely underfunded 
tribes. Let us illustrate this point with the following information 
concerning the Pascua Yaqui Tribe's Health Care funding crisis.
A. Tribal health funding
    We are asking for your support and assistance in resolving a crisis 
situation regarding our future health care. As of today, we do not know 
what type of health care services we will be receiving or who will be 
providing the health services after October 1 of this year.
    Since the time we received federal recognition, the Pascua Yaqui 
Tribe has received health care services through a pre-paid contract 
with a private HMO provider. When Indian Health Service approached the 
Tribe about participating in the HMO program in the early 1980's, our 
tribal leaders expressed concern about the uncertainty of funding for 
future tribal members and the potential of changing providers every 
three years. They reluctantly agreed to the arrangement. In retrospect, 
the concerns our tribal leaders expressed then have become a reality. 
On December 13, 1996, the Indian Health Service advised us that they 
were no longer going to be able to continue funding the HMO program 
after the current contract expires on May 31 of this year. They 
identified a shortfall of $844,588 needed to continue the HMO program 
through September 31, 1997. Since the notification, the IHS has 
provided emergency one-time funding of $585,000 to continue the program 
until September 31. However, based on their financial projections, the 
Indian Health Service estimates they need an additional $3.1 million 
dollars in fiscal year 1998 to fund the program just for the 4,500 
tribal members currently enrolled in the HMO and capping enrollment in 
the HMO at 4,500. But, we currently have over 3,500 applications that 
are likely to be approved before the October open enrollment deadline. 
These new members will need health care services. Therefore, an 
additional $4.9 million will be needed to fund the HMO program for the 
new tribal members. The Indian Health Service has provided us with 
financial information that outlines how much funding it will take to 
provide direct services to our current population and the new tribal 
members. Using their resource requirement formula, they estimate the 
cost for providing direct health care services at $16 million dollars, 
compared to the $4.1 million currently allocated for the HMO or the 
total of $12.1 million needed to fund the HMO for all our tribal 
members. As you can see, the HMO arrangement is more cost effective 
than a direct IHS program and we want the HMO program to continue.
    Health care is a priority for us. Utilizing our own tribal funds, 
we are nearing completion on a $2.7 million health complex with 25,000 
square feet. The complex will include a small satellite clinic, a ten-
chair dialysis center and a public health wellness center. Also, an 
additional $1.7 million in tribal dollars are approved annually to our 
tribal community health programs to supplement the $1.3 million dollar 
funding we receive from the Indian Health Service.
    The Indian Health Service has not been supportive or proactive in 
working with us to identify a long-term solution that will provide 
health services through the HMO program to all our eligible tribal 
members. We request the Committee direct the IHS to work with the 
Pascua Yaqui Tribe in developing a plan to submit to Congress no later 
than January 1, 1998. In addition, direct the IHS to continue to fund 
the HMO in fiscal year 1998 without an enrollment cap or reduction in 
the benefits package in the HMO program.
B. Department of Interior
            Bureau of Indian Affairs
    A second important issue to the Tribe is the appropriation of funds 
for the purpose of conducting 7 critical studies that were authorized 
by the Congress in Public Law 103-357 in 1994. Because of the Tribe's 
open enrollment, the studies were needed to adequately prepare for the 
expanded population. Let us specifically cite what those studies were. 
Among the authorized studies that we are requesting appropriations for 
are:

    ``(a) In General.--The Secretary of the Interior shall conduct one 
or more studies to determine--
    (1) whether the lands held in trust on the date of enactment of 
this section by the United States for the Pascua Yaqui Tribe are 
adequate for the needs of the tribe for the foreseeable future;
    (2) if such lands are not adequate--
    (A) whether suitable additional lands are available for acquisition 
by exchange or purchase; and
    (B) the cost and location of the suitable additional lands;
    (3) whether the Pascua Yaqui Tribe has sufficient water rights and 
allocations to meet the needs of the tribe for the foreseeable future;
    (4) if such water rights and allocations are not adequate
    (A) whether additional water can be acquired; and
    (B) the potential sources and associated costs of such additional 
water;
    (5) whether the Bureau of Indian Affairs and the Indian Health 
Service have limited funding to the Pascua Yaqui Tribe based on the 
determination of the tribal enrollment in 1978, rather than the current 
enrollment;
    (6) if funding has been based on 1978 enrollment, how the funding 
levels can be adjusted to ensure that the Pascua Yaqui Tribe receives a 
fair and equitable portion of Bureau of Indian Affairs and Indian 
Health Service funding;
    (7) the genealogy of the Pascua Yaqui Tribe; and
    (8) the economic development opportunities available to the tribe 
as a result of the North American Free Trade Agreement.''

25 U.S.C. S 1300f-3.
    To date, only the genealogy study was funded by the Bureau of 
Indian Affairs in fiscal year 1996 for $35,000. We are requesting 
$200,000 for fiscal year 1998 to commence studies on expansion of 
tribal land base, water allotment planning, additional water 
acquisition, and NAFTA economic development opportunities. The Tribe is 
prepared to provide matching funds of $50,000. Thank you.
                                 ______
                                 

      Prepared Statement of the Bering Sea Fishermen's Association

                                abstract
    The Bering Sea Fishermen's Association (BSFA) requests the Senate 
Appropriations subcommittee on Interior and Related Agencies to 
authorize an appropriation of $1,000,000 to BSFA to conduct salmon 
research and restoration projects in western Alaska and Interior river 
systems. Funds would continue to be authorized under the BIA Wildlife & 
Parks, Tribal Management and Development program. As it has done with 
the fiscal year 1994--fiscal year 1997 appropriations, BSFA would 
design and implement cooperative projects with Alaska Native villages 
in Kotzebue Sound, Norton Sound and the Yukon and Kuskokwim rivers. 
This proposal aims to maintain the Western Alaska Salmon Investigations 
Program on the original course set by Congress in fiscal year 1994: the 
monitoring and restoration of depressed salmon stocks under the 
management of one organization that serves and represents all the 
affected fishermen.
BSFA: 17 years of service to western Alaska Native villages
    Formed in 1980, the Bering Sea Fishermen's Association (BSFA) is 
non-profit extension service organization serving the needs of western 
Alaska commercial and subsistence salmon and herring fishermen. BSFA is 
governed by a 12-member Board of Alaska Native fishermen. BSFA provides 
services to Alaska Native villagers in four broad regions: Bristol Bay 
drainage, Yukon-Kuskokwim Rivers, Norton Sound and Kotzebue Sound. 
Services provided include: Assistance in dealing with state and federal 
regulations for seafood harvesting, processing and marketing; design 
and implementation of fisheries processing facilities; and scientific 
research to aid in management and development of local fisheries.
    BSFA, through a combination of state, federal and private grants, 
has played the major role in ensuring Alaska Native participation in 
the development and management of dynamic fisheries. Some of these 
accomplishments include ensuring local control and sustainability in 
emerging fisheries, developing user participation in research and 
cooperative management regimes, and design and implementation of the 
Community Development Quota (CDQ) program for sablefish, halibut and 
pollock.
BSFA's western Alaska (Arctic-Yukon-Kuskokwim) salmon restoration & 
        research program
    In response to drastic declines in chum salmon, in fiscal year 1994 
the Congress authorized a direct appropriation of $800 000 to BSFA to 
conduct salmon monitoring research restoration and enhancement projects 
in western Alaska. From early 1994 to late 1995, BSFA conducted the 
following projects:
    Kotzebue Sound.--Sikasuilaq hatchery: annual operation costs/Kobuk 
River test fishery/regional subsistence harvest surveys/formation of 
regional aquaculture association.
    Norton Sound.--Sockeye salmon: Habitat analysis, Chum salmon: 
habitat analysis, incubation units/Niukluk and Snake Rivers spawning 
escapement towers/regional subsistence harvest surveys.
    Yukon River.--Chum salmon: Productivity analysis, egg incubation & 
rearing/public forums: Inseason management/Pilot Station main river 
sonar operations/Kaltag Creek spawning escapement tower & chum salmon 
incubation/Nulato River spawning escapement tower/Tanana Village salmon 
abundance test fishwheels/Anvik River terminal harvest fishery.
    Kuskokwim River.--Public forums: Inseason management/Eek Island 
salmon abundance gillnet test fishery/Aniak River coho salmon 
escapement sonar/Nunivak Island salmon abundance study Bristol Bay Wood 
River coho salmon escapement tower
    In fiscal year 1995 BSFA was awarded $336,809 in a BIA competitive 
grant process and used the funds for the following projects:
    Kuskokwim River.--Chum salmon migration timing and distribution 
study.
    Yukon River.--Mountain Village fall chum test fishery/Andreafski 
River coho salmon escapement weir/Galena village fall chum test 
fishwheel/Tanana village fall chum test fishwheels/Tanana River fall 
chum population study.
    For fiscal year 1996 BSFA was appropriated $804,500 and used the 
funds for the following projects:
    Kotzebue Sound.--Regional salmon spawning surveys/daily catch 
sampling public forums: Inseason management and project plarning.
    Norton Sound.--Eldorado River, Snake River and North River spawning 
escapement towers/Pilgrim River spawning reconnaissance/regional 
subsistence harvest surveys.
    Yukon River.--Public forums: Inseason management and project 
planning/Andreafsky River weir/Pilot Station sonar/Kaltag Cr., Nulato 
River, Clear River spawning escapement towers/Mountain Village, Tanana 
Village and Ft. Yukon test fisheries/Toklat & Nenana Rivers spawning 
surveys/Tanana chum population studies.
    Kuskowkim River.--Public forums: Inseason management and project 
planning/Kanektok, Takotna and Kwethluk escapement towers/George River 
weir/Aniak River sonar.
    For fiscal year 1997 BSFA was appropriated $805 000 by Congress and 
has just begun work on implementing many of the same projects above as 
well as designing new projects.
    For all of these projects these last 3 years, BSFA has worked 
directly with and contracted with Alaska Native individuals, villages 
and regional Native non-profit associations. Through using the BIA 
appropriation as matching funds, BSFA has leveraged several thousands 
dollars of project support from the Alaska Department of Fish and Game 
and the U.S. Fish & Wildlife Service. Finally these BSFA-administered 
projects were implemented with a low indirect cost rate of only 18 
percent.
Fiscal year 1998 proposed projects
    The BSFA Board and staff, in consultation with Alaska Native 
organizations and tribes, would continue to exercise the leadership 
role in coordinating salmon research and restoration projects. BSFA is 
the only group that represents and works with all fishermen (commercial 
and subsistence) and villagers throughout the entire Arctic-Yukon-
Kuskokwim region. BSFA Board and staff are intimately familiar with 
salmon research needs in the A-Y-K region.
    BSFA will continue to contract with local and regional Alaska 
Native organizations and other appropriate entities as well as with 
individual fishermen. BSFA staff will work with these organizations and 
individuals as well as with state and federal agency staff to design, 
coordinate and implement projects. BSFA staff would include a Fisheries 
Biologist and Program Director as well as part-time administrative 
personnel to work directly with subcontractors and cooperating 
agencies. Having BSFA as the single responsible program management 
entity will assure both the development of tribal expertise and the 
fulfillment of Congressional intent to rebuild salmon returns in an 
efficient manner.
    We request a continued direct appropriation of $1,000,000 to Bering 
Sea Fishermen's Association for fiscal year 1998 to continue to conduct 
salmon research & restoration projects in the affected Arctic-Yukon-
Kuskokwim region of western Alaska. Funding for BSFA would continue to 
come from the BIA's Wildife & Parks/Tribal Management & Development 
program.
    Projects meeting the following criteria would be implemented: 
Priority funds to continue scientifically-useful projects developed in 
fiscal year 1994 thru fiscal year 1997; must fill a gap in the database 
on western Alaska salmon; if applicable, work in cooperation with state 
and federal land agencies; and majority of contractors hired must work 
in the field and be local hire.
    We appreciate the trust Congress has shown in BSFA by having us 
direct this program. The last few years of research has dramatically 
improved the ability of fisheries managers to meet the commercial and 
subsistence needs of western Alaska Native communities. Thank you for 
this opportunity to submit written testimony.
                                 ______
                                 

 Prepared Statement of Robert W. Sutton, Executive Director, American 
                         Indian Graduate Center

    Mr. Chairman and Members of the Subcommittee: The American Indian 
Graduate Center (AIGC) is grateful for the opportunity to present 
testimony in support of the BIA's Special Higher Education Program 
(SHOP). AIGC has administered the SHEP since 1972, the only national 
scholarship program in the country focusing on American Indian and 
Alaskan Native graduate students. We respectfully request $3 million 
for this Bureau of Indian Affairs Program in the 1998 fiscal year 
Budget.
                               background
    AIGC is a national, Indian, non-profit organization established in 
1969 to assist American Indian and Alaskan Native students needing 
financial aid for graduate school. From 1972 to the present, AIGC has 
administered the BLA Graduate program in all professional degree areas. 
Until this year the Graduate Center was assisting approximately 90 
percent of all Indian graduate students nationwide. Nearly 90 percent 
of all SHEP funds goes directly to students in fellowship grants, and 
10 percent or less is for administrative costs.
    The Graduate Center also raises funds from private sources. However 
90 percent of our fellowship awards come from the SHEP contract funds. 
There have been over 4,000 students served by this program in 25 years. 
Last year, the 1995-96 Academic Year, we awarded over 500 students over 
$2 million. The fiscal year 1996 appropriation reduced our funding by 
50 percent, from $2.6 million to $13 million. The fiscal year 1997 
funding remained at $0.3 million. Due to the devastating cut in 
funding, we were only able to help our 250 continuing students. There 
were over 800 requests from new students that we could not help. Many 
of these students were unable to continue their education and will 
probably never be able to continue. The continually increasing number 
of students, over 1,300 requests for next year, will substantially 
reduce the amount each student receives to a point where the SHEP award 
will be insignificant. This coupled with the continually increasing 
cost of education will have a significant impact on the student's 
ability to remain in school. As the Indian undergraduate student 
population increases this program will not be able to assist them in 
advancing their skills without increased funding. Former recipients of 
this program, such as Lorraine Edmo, Executive Director of NIEA and 
Assistant Secretary Ada Deer of the BIA, are successful leaders in the 
Indian community.
    The report in ``Indian Nations at Risk: An Educational Strategy for 
Action,'' issued by the Department of Education in October of 1991 
stated: ``An increase in funding to train Native educators for 
elementary, secondary, and university teaching and other professions in 
science, mathematics, law, engineering, and medicine, business, the 
social sciences and related fields as a national priority,'' was needed 
for the tribal communities throughout the country. These will be 
trained, Indian professionals who are not only critical to the well-
being of American Indian communities, but to the country as a whole. We 
all know that Education is the key ingredient to self-sufficiency.
                 current funding and student statistics
    For the current 1997 fiscal year the contract amount is $1,333,000. 
The following is a final breakdown of the number of students and their 
fields of study from the 1995-96 academic year and preliminary figures 
for the 1996-97 academic year.

                  NUMBER OF STUDENTS AND FIELD OF STUDY                 
------------------------------------------------------------------------
                                                  Academic year--       
             Field of study              -------------------------------
                                              1995-96         1996-97   
------------------------------------------------------------------------
Business................................              49              20
Education...............................              59              23
Engineering.............................               8               2
Health..................................             160              89
Law.....................................             164              99
Natural resources.......................               3               1
Other...................................              95              48
Number of males.........................             196             110
Number of females.......................             342             172
Total tribes represented................             123              86
Total colleges represented..............             197             130
Masters candidates......................             230              87
Doctorate candidates....................             295             192
Dual degree programs....................              13               3
                                         -------------------------------
      Total.............................             538             282
------------------------------------------------------------------------

    Applicants to AIGC must apply for campus-based aid through the 
federal financial aid process. Our program limits assistance to only a 
portion of their unmet need. The unmet need last academic year was $7.3 
million compared to this year of $4 million. The average award this 
year is only $3,300, which represents a small percentage of their 
costs. Over the last three years there has been a reduction in our 
maximum award from $8,000 to $4,000 because of the increasing number of 
eligible applicants and escalating college costs.
    We have been able to operate the SHEP at a cost efficient level for 
the past ten years. The low overhead costs are due to a well-trained 
staff and the use of modern computer technology. This has enhanced our 
ability to service our students. We have perfected our methods of 
delivering services, office procedures and internal systems. We are 
confident we can continue to successfully administer the Special Higher 
Education Program, at a cost savings to the Government.
                            summary request
    The American Indian Graduate Center requests Congress continue 
funding the Special Higher Education Program at the proposed level of 
support. Additionally, allowing for increases in student applicants and 
costs of education, we desperately need the program increased to at 
least $3 million in the 1998 fiscal year BLA budget. We greatly 
appreciate your continued support of Indian graduate education. Your 
efforts will ensure a pool of skilled professionals to improve the 
economic conditions on Indian reservations and support the greater 
social environment as productive members of society.



       LIST OF WITNESSES, COMMUNICATIONS, AND PREPARED STATEMENTS

                              ----------                              
                                                                   Page

Alexander, Jane, Chairman, National Endowment for the Arts.......   321
    Biographical sketch..........................................   337
    Prepared statement...........................................   334
Allen, Wm. Ron, commissioner, U.S. Section of the Pacific Salmon 
  Commission; and president, National Congress of American 
  Indians, prepared statements...................................
  923, 929, 931..................................................
American Association of Retired Persons, prepared statement......   717
American Gas Association, prepared statement.....................   727
American Public Power Association, prepared statement............   703
Apesanahkwat, chairman, Menominee Indian Tribe of Wisconsin, 
  prepared statement.............................................   921
Arita, Steven J., environmental coordinator, Western States 
  Petroleum Association, prepared statement......................   830
Assiniboine and Sioux Tribes of the Fort Peck Indian Reservation, 
  prepared statement.............................................   881
Atwine, Ruby, chair, Tribal Business Committee of the Ute Indian 
  Tribe of the Uintah and Ouray Reservation, prepared statement..   891
Aunan, Lauri G., executive director, Friends of the Columbia 
  Gorge, prepared statement......................................   797

Babbitt, Hon. Bruce, Secretary of the Interior, Office of the 
  Secretary, Department of the Interior..........................   409
    Prepared statement...........................................   417
Bahr, Dr. Thomas G., on behalf of the National Institutes for 
  Water Resources, prepared statement............................   840
Barnett, Jack A., executive director, Colorado River Basin 
  Salinity Control Forum, prepared statement.....................   847
Beard, Daniel, P., senior vice president for policy, the National 
  Audubon Society, prepared statement............................   805
Beetham, Mary Beth, legislative associate, Defenders of Wildlife, 
  prepared statement.............................................   832
Begay, Jones, president, Association of Navajo Community 
  Controlled School Boards and Navajo Nation Council Delegate, 
  prepared statement.............................................   919
Bennett, Hon. Robert F., U.S. Senator from Utah..................
  139, 297.......................................................
Bering Sea Fishermen's Association, prepared statement...........   964
Billie, James E., chairman, Seminole Tribe of Florida, prepared 
  statement......................................................   906
Bingaman, Hon. Jeff, U.S. Senator from New Mexico, on behalf of 
  the Interstate Oil & Gas Compact Commission, prepared statement   693
Blackhawk, John, chairman, Winnebago Tribe of Nebraska, prepared 
  statement......................................................   858
Blue Eyes, Faye, executive director, Shiprock Alternative 
  Schools, Inc., Navajo Nation, Shiprock, NM, prepared statement.   938
Bond, Hon. Christopher, U.S. Senator from Missouri...............   412
Booth, Hon. Jack, mayor, Metlakatla Indian Community, prepared 
  state- ment....................................................   939
Boxer, Hon. Barbara, U.S. Senator from California................   323
Bristol Bay Area Health Corp., prepared statement................   868
Brown, Robert D., president, National Association of University 
  Fisheries and Wildlife Programs, letter from...................   820
Bumpers, Hon. Dale, U.S. Senator from Arkansas...................   329
Burns, Hon. Conrad, U.S. Senator from Montana....................   180
    Prepared statement...........................................   325
    Questions submitted by.......................................
      290, 635...................................................
Burr, Joyce, superintendent, Circle of Nations School, prepared 
  statement......................................................   952
Business Council for Sustainable Energy, prepared statement......
                                                         705, 714
Byrd, Hon. Robert, U.S. Senator from West Virginia...............   411
    Questions submitted by.......................................
      92, 302, 355, 396, 597.....................................

Cabral, Robert J., supervisor, San Joaquin County, chairman of 
  the board, San Joaquin Valley Unified Air Pollution Control 
  District, prepared statement...................................   752
Camara, Elias H., president and CEO, M-C Power Corp., prepared 
  state- ment....................................................   678
Campbell, Hon. Ben Nighthorse, U.S. Senator from Colorado........
                                                           1, 326
    Prepared statement...........................................   328
    Questions submitted by.......................................
      173, 289...................................................
Capoeman-Baller, Pearl, president, Quinault Indian Nation, 
  prepared statement.............................................   960
Charles, Frances G., chairwoman, Lower Elwha Klallam Tribe, 
  prepared statement.............................................   878
Chino, Wendell, president, Mescalero Apache Tribe, letter from...   128
Circle of Nations Wahpeton Indian School Board, Wahpeton, ND, 
  prepared statement.............................................   901
Clark, Les, vice president, Independent Oil Producers' 
  Association; and on behalf of the Kern County Valley Floor 
  Habitat Conservation Plan Industry and Government Coalition, 
  prepared statements............................................
  752, 830.......................................................
Clean Coal Technology Coalition, prepared statement..............   709
Clinton, Hon. Bill, President of the United States, letter from..   475
Coachella Valley Mountains Conservancy, prepared statement.......   858
Coal Utilization Research Council [CURC], prepared statement.....   686
Cochran, Hon. Thad, U.S. Senator from Mississippi................   330
    Prepared statement...........................................   380
    Questions submitted by.......................................
      107, 157, 174, 300, 621....................................
Colnes, Andrea L., director, the Northern Forest Alliance, 
  prepared statement.............................................   792
Colorado River Indian Tribes, prepared statement.................   908
Comanor, Joan, Deputy Chief, State and Private Forestry, Forest 
  Service, Department of Agriculture.............................   177
Conrad, Gregory E., executive director, Interstate Mining Compact 
  Commission, prepared statement.................................   774
Cox, Patrice, president, Sacramento Open Space, letter from......   830
Crawford, Tommy, chair, Southern Manufactured Housing Alliance, 
  New York, NY, letter from......................................   682
Cukro, George, executive director, Black Mesa Community and 
  School of the Navajo Nation, prepared statement................   936
Cunha, Manuel, Jr., president, Nisei Farmers League, prepared 
  statements.....................................................
  752, 830.......................................................

Darguzas, Joseph N., Sargent & Lundy, L.L.C., prepared statement.   691
Davenport, Eric R., chairman, Intertribal Monitoring Association, 
  prepared statement.............................................   954
Deer, Hon. Ada E., Assistant Secretary for Indian Affairs; and 
  Chair, National Indian Gaming Commission, Bureau of Indian 
  Affairs, Department of the Interior............................
  111, 160.......................................................
    Biographical sketch..........................................   167
    Prepared statement...........................................
      115, 164...................................................
Derbyshire, Dr. Frank, director, University of Kentucky, Center 
  for Applied Energy Research, prepared statement................   680
Dessecker, Daniel R., forest wildlife biologist, prepared 
  statement......................................................   795
Dombeck, Mike, Chief, Forest Service, Department of Agriculture..   186
    Letter from..................................................   226
    Prepared statement...........................................   188
Domenici, Hon. Pete, U.S. Senator from New Mexico................    21
    Questions submitted by.......................................
      294, 632...................................................
Doolittle, Warren T., president, International Society of 
  Tropical Foresters, Inc., letter from..........................   790
Dorgan, Hon. Byron, U.S. Senator from North Dakota...............    32
    Prepared statement...........................................    32
    Questions submitted by.......................................
      109, 158, 308, 667.........................................
Dutz, Joseph, Chief Financial Officer, Bureau of Indian Affairs, 
  Department of the Interior.....................................   160

Ebel, John E., director, the Weston Observatory of Boston 
  College, prepared statement....................................   836
Electric Transportation Coalition, prepared statement............   700

Fedman, Alan, Director of Enforcement, Bureau of Indian Affairs, 
  Department of the Interior.....................................   160
Fond du Lac Band of Lake Superior Chippewa, prepared statement...   885
Franklin, Thomas M., wildlife policy director, the Wildlife 
  Society, prepared statement....................................   763
Fregien, Gary O., president, California Parks and Conservation 
  Association, letter from.......................................   829

Gainesville, FL, city of, regarding the Sweetwater Branch/Paynes 
  Prairie stormwater project, prepared statement.................   755
Gallery, Audrey, honorary chairman, U-505 Restoration Committee..   669
General Electric Power Systems, prepared statement...............   744
George, Father William L., S.J., assistant for Federal relations, 
  Georgetown University, prepared statement......................   708
Geringer, Hon. Jim, Governor, State of Wyoming, prepared 
  statement......................................................   781
Gipp, David M., president, United Tribes Technical College, 
  prepared statement.............................................   861
Gorton, Hon. Slade, U.S. Senator from Washington.................
                                                23, 111, 177, 321
Grey, Andrew, chairman, Sisseton-Wahpeton Sioux Tribe, Lake 
  Traverse Reservation, prepared statement.......................   894
Gunn, Susan H., director of budget and appropriations, the 
  Wilderness Society, prepared statement.........................   825

Hackney, Sheldon, chairman, National Endowment for the Humanities   371
    Prepared statement...........................................   375
Herrera, Stanley, president, Alamo-Navajo School Board, Alamo, 
  NM, prepared statement.........................................   935
Hertfelder, Eric, executive director, on behalf of the National 
  Conference of State Historic Preservation Officers, prepared 
  statement......................................................   851
Hocker, Jean, president, Land Trust Alliance, letter from........   803
Holmer, Steve, campaign coordinator, Western Ancient Forest 
  Campaign, prepared statement...................................   795
Hutchison, Hon. Kay Bailey, U.S. Senator from Texas, questions 
  submitted by...................................................   664

Indigenous People's Council for Marine Mammals, prepared 
  statement......................................................   857
Integrated Petroleum Environmental Consortium, prepared statement   732
Interstate Council on Water Policy, prepared statement...........   838

James, Gordon, chairman, Skokomish Indian Tribe, prepared 
  statement......................................................   867
James, Hon. Sharpe, mayor, on behalf of the city of Newark, NJ, 
  prepared statement.............................................   754
James, Ted, planning director, Kern County Planning Department, 
  prepared statement.............................................   830
Janger, Stephen A., president, Close Up Foundation, prepared 
  statement......................................................   874
John, Hon. Ismael, senator, Nitijela of the Marshall Islands on 
  behalf of the Enewetak/Ujelang Local Government Council, 
  prepared statement.............................................   898
Jollivette, Cyrus M., vice president for government relations, on 
  behalf of the University of Miami, prepared statement..........   849
Judd, Joe, commissioner on behalf of the Kane County, Utah 
  Commission, prepared statement.................................   845

Kellstrom, Todd, mayor, city of Klamath Falls, OR, letter from...   844
Kennamer, James Earl, Ph.D., vice president for conservation 
  programs, National Wild Turkey Federation, prepared statement..   799
Kenny, Michael P., executive officer, California Air Resources 
  Board, prepared statement......................................   752
Kilham, Alice, cochair, Upper Klamath Basin Working Group, 
  prepared statement.............................................   782
Knight, Robert H., on behalf of the Family Research Council, 
  prepared statement.............................................   672
Kripowicz, Robert S., Principal Deputy Assistant Secretary, 
  Office of Fossil Energy, Department of Energy..................     1
    Biographical sketch..........................................    12

Lackey, J. Kevin, conservation programs director, Rocky Mountain 
  Elk Foundation, letter from....................................   788
Lawson, Richard L., president, National Mining Association [NMA], 
  prepared statement.............................................   741
Leahy, Hon. Patrick, U.S. Senator from Vermont...................   227
    Questions submitted by.......................................
      108, 310...................................................
Lee, Dr. Bernard S., president, Institute of Gas Technology, 
  prepared statement.............................................   697
Linehan, Dr. Thomas E., president, Ringling School of Art and 
  Design, on behalf of the Association of Independent Colleges of 
  Art and Design, prepared statement.............................   674
Loretto, Leonard, governor, the Pueblo of Jemez, prepared 
  statement......................................................   889
Lundy, Jeff, on behalf of the State of Mississippi Oil & Gas 
  Board and Ground Water Protection Council, prepared statement..   750
Lyons, Hon. Jim, Under Secretary, Natural Resource and 
  Environment, Forest Service, Department of Agriculture.........   177
    Prepared statement...........................................   184

Maddox, Deborah J., Director, Office of Tribal Services, Bureau 
  of Indian Affairs, Department of the Interior..................   111
Manuel, Hilda A., Deputy Commissioner of Indian Affairs, Bureau 
  of Indian Affairs, Department of the Interior..................   111
Mason, ``Bud'' Russell, board chairman, United Tribes Technical 
  College, prepared statement....................................   861
Maulson, Tom, tribal chairman, on behalf of the Lac du Fambeau 
  Band of Lake Superior Chippewa Indians, prepared statement.....   883
McDivitt, James H., Acting Director, Office of Management and 
  Administration, Bureau of Indian Affairs, Department of the 
  Interior.......................................................   111
McDougle, Janice, Acting Deputy Chief, National Forest System, 
  Forest Service, Department of Agriculture......................   177
Meeker, B. Sharon, chairperson, Lamprey River Advisory Committee, 
  letter from....................................................   849
Mejia, Margie, chairperson, Lytton Ranceria/Lytton Band of Pomo 
  Indians of California, prepared statement......................   870
Melissaratos, Aris, vice president of science, technology and 
  quality, Westinghouse Electric Co., prepared statement.........   730
Mitchell, Jeff, C., tribal chairman, the Klamath Tribes, 
  Chiloquin, OR, letter from.....................................   586
Mondre, Judith L., executive director, city of Philadelphia 
  Energy Office; and chair, Urban Consortium Energy Task Force, 
  prepared statement.............................................   721
Mooney, Ross, Dam Safety Officer, BIA, Bureau of Indian Affairs, 
  Department of the Interior.....................................   111
Morris, Joann Sebastian, Director, Office of Indian Education 
  Programs, Bureau of Indian Affairs, Department of the Interior.   111
Moses, Joe, chairman, tribal council, the Confederated Tribes of 
  the Warm Springs Reservation of Oregon, prepared statement.....   896
Munoz, Vince, Governor, the Tigua Indian Reservation, El Paso, 
  TX, letter from................................................   587
Murphy, Virgil J., chairman, Stockbridge-Munsee Community Band of 
  Mohican Indians, prepared statement............................   876

Narragansett Tribe, prepared statement...........................   951
National Association for State Community Services Programs 
  [NASCSP], prepared statement...................................   692
National Association of Energy Service Companies, prepared 
  statement......................................................   688
National Indian Child Welfare Association, prepared statement....   864
Natural Gas Industry Research, Development and Demonstration 
  Initiative, prepared statement.................................   724
Navajo Nation, prepared statement................................   955
Nimmons, John T., managing director, Alliance to Commercialize 
  Carbonate Technology, prepared statement.......................   736

Pacelle, Wayne, vice president, government affairs, the Humane 
  Society of the United States [HSUS], prepared statement........   821
Padilla, Nicolas J., on behalf of the Susanville Indian 
  Rancheria, prepared statement..................................   941
Palmer, James I., Jr., director, Mississippi Department of 
  Environmental Quality, Jackson, MS, letters from...............   624
Pena, Federico F., Secretary of Energy, Office of the Secretary, 
  Department of Energy...........................................     1
    Biographical sketch..........................................    11
    Prepared statement...........................................     4
Penney, Samuel N., chairman, Nez Perce Tribal Executive 
  Committee, prepared statement..................................   853
Peter, Hon. Neptali, mayor, Enewetak Atoll, on behalf of the 
  Enewetak/Ujelang Local Government Council, prepared statement..   917
Peterson, R. Max, executive vice president, International 
  Association of Fish & Wildlife Agencies, prepared statement....   809
Petroleum Technology Transfer Council, prepared statement........   683
Pinkham, Jaime, president, Intertribal Timber Council, prepared 
  statement......................................................   871
Pinon Community School Board, Inc., prepared statement...........   947
Polles, Sam, executive director, Mississippi Department of 
  Wildlife, Jackson, MS, letters from............................
  623, 624.......................................................
Poynter, Ken, executive director, Native American Fish & Wildlife 
  Society, prepared statement....................................   818

Rawlings, Hunter R., III, president, Cornell University, on 
  behalf of the Association of American Universities, American 
  Council on Education, National Association of State 
  Universities and Land-Grant Colleges, prepared statement.......   670
Reheis, Catherine H., managing coordinator, Western States 
  Petroleum Association on behalf of the California Industry and 
  Government Coalition, on PM-10/PM-2.5, prepared statement......   752
Richardson, Linda, Director of Audit and Evaluation, Bureau of 
  Indian Affairs, Department of the Interior.....................   111
Robert, Hollis E., president, Inter-Tribal Council, the Five 
  Civilized Tribes, letter from..................................   588
Rock Point Community School, prepared statement..................   944
Romm, Joseph J., Principal Deputy Assistant Secretary, Office of 
  Energy Efficiency and Renewable Energy, Department of Energy...     1
    Biographical sketch..........................................    13
Rooks, Paul A., chief of police, Oglala Sioux Tribal Public 
  Safety Commission, prepared statement..........................   950
Runnels, Bruce, chief conservation officer, the Nature 
  Conservancy, prepared statement................................   778
Ryan, John, Water Trucks, letter from............................   226

Satterfield, Steven, Director, Program Development and Budget 
  Staff, Forest Service, Department of Agriculture...............   177
Saulque, Joseph C., chairman, Owens Valley Indian Water 
  Commission, prepared statement.................................   916
Sault Ste. Marie Tribe of Chippewa Indians, prepared statement...   879
Savitz, Dr. Maxine, general manager, AlliedSignal Ceramic 
  Components, prepared statement.................................   747
Sawyer, Andy, chapter chair, Sierra Club, Mother Lode Chapter, 
  letter from....................................................   828
Schweigert, Jerry, facilities transition program staff, Bureau of 
  Indian Affairs, Department of the Interior.....................   111
Scudero, James, E., acting mayor, Council Annette Islands 
  Reserve, Metlakatla Indian Community, Metlakatla, AK, letter 
  from...........................................................   585
Sletteland, Trygve, Pacific Rivers Council, prepared statement...   785
Sloan, Mary Margaret, conservation director, American Hiking 
  Society, prepared statement....................................   772
Slocum, Dr. Edward, superintendent, New Town Public School 
  District No. 1, prepared statement.............................   913
Smedley, Elizabeth E., Acting Chief Financial Officer, Department 
  of Energy......................................................     1
    Biographical sketch..........................................    13
Speight, James, D.G., chief executive officer, Western Research 
  Institute, letter from.........................................   718
Startzell, David N., executive director, Appalachian Trail 
  Conference, prepared statement.................................   768
Steinbach, Thomas, director of conservation, Appalachian Mountain 
  Club, prepared statement.......................................   761
Stevens, Christine, secretary, Society for Animal Protective 
  Legislation, prepared statement................................   824
Stevens, Hon. Ted, U.S. Senator from Alaska, questions submitted 
  by.............................................................
  148, 618.......................................................
Stewart, Ron, Acting Deputy Chief, Programs and Legislation, 
  Forest Service, Department of Agriculture......................   177
Stone, Wanda, chairperson, CEO, the Kaw Nation, Kaw City, OK, 
  letter from....................................................   588
Stout, Elaine M., president, the Back Country Land Trust, letter 
  from...........................................................   760
Strong, Ted, executive director, Columbia River Inter-Tribal Fish 
  Commission, prepared statement.................................   926
Styles, Gary A., manager, planning and analysis power systems 
  development facility, Southern Company Services, Inc., prepared 
  statement......................................................   712
Sutton, Robert W., executive director, American Indian Graduate 
  Center, prepared statement.....................................   965

Thompson, Clyde, Acting Deputy Chief, Administration, Forest 
  Service, Department of Agriculture.............................   177
Tice, R. Dean, executive director, the National Recreation & Park 
  Association, letter from.......................................   757
Tijm, Peter J.A., manager, Syngas Conversion Systems, Air 
  Products & Chemicals, Inc., prepared statement.................   739
Tsosie, Wallace, vice president, Greasewood Springs Community 
  School, Inc., Navajo Nation, Ganado, AZ, prepared statement....   948

Unger, David G., Associate Chief, Forest Service, Department of 
  Agriculture....................................................   177

Valencia, Benito, chairman, Pascua Yaqui Indian Tribe of Arizona, 
  prepared statement.............................................   962
Virden, Terry, Director, Office of Trust Responsibilities, Bureau 
  of Indian Affairs, Department of the Interior..................   111

Walsh, Donald, L., Bulldozer Service, letter from................   226
Webb, David O., senior vice president, Policy and Regulatory 
  Affairs, on behalf of the Gas Research Institute [GRI], 
  prepared statement.............................................   675
Weber, Barbara, Acting Deputy Chief, Research, Department of 
  Agriculture....................................................   177
Werbelow, Karen, executive director, Foundation for North 
  American Wild Sheep, prepared statement........................   756
Whitefeather, Bobby, chairman, Red Lake Band of Chippewa Indians, 
  letter from....................................................   854
Wilde, Harry, cochair, Lower Yukon and Gilbert Huntington, 
  cochair, Upper Yukon of the Yukon River Drainage Fisheries 
  Association, prepared statement................................   866
Wilder, Ilene, Sargent & Lundy, L.L.C., prepared statement.......   691
Williamson, Lonnie L., vice president, Wildlife Management 
  Institute, prepared statement..................................   800
Willis, Lorene, president, National Indian Education Association, 
  prepared statement.............................................   903
Wilmer, John, Sr., chairman, the Bad River Band of Lake Superior 
  Chippewa Indians, prepared statement...........................   887
Wright, Mervin, Jr., chairman, Pyramid Lake Paiute Tribe, 
  prepared statement.............................................   913
Wynne, Bruce, chairman, Spokane Tribe of Indians, prepared 
  statement......................................................   910



                             SUBJECT INDEX

                              ----------                              

                       DEPARTMENT OF AGRICULTURE
                             Forest Service

                                                                   Page

Additional committee questions...................................   240
Associates, introduction of......................................   187
Awards...........................................................   201
Beaver management................................................   204
Bison contingency plan...........................................   217
Brucellosis......................................................   217
Budget request...................................................   177
Columbia basin ecosystem.........................................   231
Fire:
    And forest health............................................   195
    Equipment....................................................   225
Flood funding....................................................   236
Forest management................................................
  194, 224.......................................................
Forest Service organization......................................   196
FTE hits.........................................................   215
Grasslands.......................................................   216
Grazers..........................................................   217
Infested timber..................................................   210
Insect and disease...............................................   208
Law enforcement..................................................   233
National monument................................................   238
Native Americans.................................................   179
Organization changes.............................................
  191, 192.......................................................
Performance awards...............................................   200
Purchaser credits................................................   202
Recreation.......................................................   193
    Demand.......................................................   207
Roads............................................................   213
Salvage sale programs............................................   229
Sawtooth range management........................................   220
State and private forestry programs..............................   228
Stewardship......................................................   214
Tahoe basin/forest health........................................   205
Takoo River......................................................   209
Thinning program.................................................   195
Timber sale:
    Level........................................................   203
    Targets......................................................   233
Tongass timber...................................................
  198, 199.......................................................
Trails...........................................................   222
Washington State, issues.........................................   237
Water:
    Quality......................................................   206
    Rights.......................................................   222
Western Director Office..........................................   235

                          DEPARTMENT OF ENERGY
                        Office of the Secretary

Additional committee questions...................................    41
Allocation to subcommittee.......................................    26
Arctic National Wildlife Refuge..................................    40
Arthur D. Little study...........................................    37
Clean coal technology rescission.................................    35
Codes and standards..............................................    31
Electricity deregulation.........................................    27
Elk Hills, sale of...............................................    23
Energy efficiency and renewable energy...........................    18
EPA standard on particulates.....................................    36
Federal Energy Technology Center consolidation...................    19
Federal energy:
    Management program...........................................    36
    Technology program direction.................................    19
Fossil energy....................................................    15
    Research and development accomplishments.....................    28
Fuel cell technology, new........................................    30
Home energy rating system pilot program..........................    39
Morgantown, environmental management program at..................    20
National Renewable Energy Lab....................................    15
Naval petroleum and oil shale reserves...........................    14
Oil, decrease in domestic production of..........................    17
President's budget, increases in fiscal year 1998................
  22, 25.........................................................
Renewable energy--use and future projections.....................    17
Repayment provisions.............................................    31
Rocky Flats......................................................    14
Strategic petroleum reserve......................................    24
Vehicles, partnership for a new generation of....................    38

                       DEPARTMENT OF THE INTERIOR
                        Bureau of Indian Affairs
                        Indian Gaming Commission

Additional committee questions...................................
  146, 173.......................................................
Associates, introductions of.....................................   113
Budget request...................................................
  111, 160.......................................................
Bureau of Indian Affairs, long-term goal for.....................   140
Dams, safety of..................................................   134
Education........................................................
  130, 131.......................................................
    Facilities...................................................   125
    Program performance..........................................   137
Enforcement activities...........................................   164
Funding possibilities............................................   172
Funding proposal.................................................   167
Gaming in:
    California...................................................   168
    Washington...................................................   170
Indian country in Alaska.........................................   145
Indian reservations, construction of.............................   137
Laguna industries................................................   131
Law enforcement facilities.......................................   134
Mescalero Apache proposal........................................   128
NIGC mission.....................................................   161
Political contribution...........................................   144
Programs subcommittee is responsible for.........................   141
Regulations, compliance with.....................................   168
Seminole decision................................................   169
Status of activities.............................................   163
Tribal government, source of money for...........................   119
Tribal:
    Fund distribution............................................   120
    Shares.......................................................   123

                        Office of the Secretary

Additional committee questions...................................   488
Alaska roads.....................................................   479
Bison:
    Herd:
        Integrity................................................   475
        Management...............................................   475
    Management plan..............................................   475
    On Federal land..............................................   476
    Yellowstone..................................................   474
Budget:
    Priorities...................................................   482
    Request......................................................   409
    Resolution...................................................   441
        User fees................................................   443
Bureau of Land Management........................................   416
C&O Canal........................................................   486
Canaan Valley:
    Funding......................................................   432
    National Wildlife Refuge.....................................   430
Central Utah project.............................................   486
Connecticut River partnership....................................   446
Eastern Shawnee Tribe trust petition.............................   433
Endangered Species Act...........................................   415
Everglades.......................................................   482
Federal rights...................................................   424
Fee demonstration project........................................   414
Fort Smith National Historic Site................................   442
Funding:
    Committee....................................................   410
    Eco-regional plans...........................................   481
    Problem......................................................   438
George Washington, parkway.......................................   432
Indian:
    Gaming.......................................................   439
    Programs.....................................................   416
    Relationship with Federal Government.........................   443
    Schools......................................................   444
Interior:
    Columbia River basin study...................................   480
    History......................................................   422
    Program direction............................................   413
Invasive species.................................................   448
Land:
    Acquisition funding..........................................   483
    And water conservation fund..................................   447
    Land.........................................................   435
    Management agencies..........................................   414
Lower Mississippi Delta Region Heritage Center...................   442
Mining royalties.................................................   441
Missisquoi National Wildlife Refuge..............................   447
National Conservation Training Center............................   429
National Park:
    Harper's Ferry...............................................   432
    Hot Springs..................................................   442
    Service maintenance backlog..................................   449
    Yellowstone--roads...........................................   474
National parks, roads in.........................................   425
National wildlife refuges........................................   416
Nevada Bureau of Land Management.................................   435
New World Mine...................................................   478
Park:
    Housing......................................................   473
    Infrastructure priority list.................................   474
    Service funding..............................................   484
Parks, transportation in.........................................   415
Petroglyphs National Monument....................................   445
Presidio.........................................................   485
Revised Statute 2477.............................................   422
    History......................................................   422
Rights of Congress...............................................   428
Rights-of-way....................................................   423
    Legislation..................................................   426
    Policy.......................................................   427
Rim Rock Run.....................................................   439
Secretarial accolades............................................   446
Southwest:
    Fisheries Center.............................................   446
    Willow flycatcher............................................   445
Supplemental appropriations......................................   447
    Veto proposal................................................   426
Three-State area.................................................   473
Training.........................................................   430
Tribal self-determination........................................   439
U.S. Geological Survey...........................................   445
Wild horses......................................................   438
    Program funding versus park funding..........................   436
Yosemite flood damage............................................   415

                    NATIONAL ENDOWMENT FOR THE ARTS

Additional committee questions...................................   348
American Canvas..................................................   344
Application and grant statistics.................................   340
Arts:
    Federal role in the..........................................   331
    Need for government investment to the........................   333
    Private sector funding of the................................   332
    Society's need for the.......................................   329
    States support of the........................................   346
Budget request...................................................   321
Chairman's action grants.........................................   346
Cultural treasures, preservation of..............................   326
Distribution of funds appropriated through subcommittee..........   323
Economic consequences of agency elimination......................   342
Endowments:
    Possible consolidation of....................................   339
    Support for continuation of..................................   323
Importance of NEA to California..................................   324
Income recovery policy...........................................   347
NEA:
    Makes the arts accessible....................................   332
    Money, geographic distribution of............................   343
    Partnership with States......................................   340
    Preservation of native American culture......................   327
    Programs for at-risk youth...................................   343
    Reorganization of............................................   340
    Support of American artists abroad...........................   347
NEH, President's request for.....................................   324
Penal systems, importance of the arts in.........................   341
Romanov exhibit..................................................   338
Status of NEA:
    Appropriation in the House...................................   339
    Reauthorization..............................................   339
Value of the arts to society.....................................   333

                 NATIONAL ENDOWMENT FOR THE HUMANITIES

Additional committee questions...................................   388
Budget:
    Request......................................................   371
    Transition to a lower........................................   374
NEH and NEA, merging of..........................................   385
National Trust for the Humanities................................   387
NEH:
    And American heritage rivers initiative......................   386
    Chairman, advice for next....................................   384
    Maintaining a nonpartisan....................................   384
Public service and the temper of the times.......................   380
State humanities councils compared to State arts agencies........   385
Summer seminars for schoolteachers...............................   382
The conversation and American values.............................   374
The National Conversation and Civil Society......................   373